For most credit card users, being able to withdraw cash from an ATM seems like a revelation. After all, who wouldn’t want to take advantage of being able to borrow cash from their credit card now and again when money gets low in your bank account?
But getting cash from an ATM using your credit card isn’t something you’ll want to get in the habit of doing. The main reason? Banks see it as a risky behavior, and besides costing you a lot of money in interest payments and fees, regularly getting cash advances can also damage your credit score. We’ve got the details on what you need to know about using your credit card at the ATM and why cash advances from your credit card issuer should only be used in cases of emergency .
Can You Use a Credit Card to Get Cash at an ATM?
Yes, you can use a credit card to get cash from an ATM. Unlike withdrawing money from a debit account, withdrawing cash from your credit card is equivalent to getting a cash advance — which comes with its own unique set of costs, including higher interest rates and increased fees. Although many credit cards will allow you to withdraw cash from an ATM, it isn’t something you should get in the habit of doing.
Because credit card cash advances are typically applied to a different (and much smaller) line of credit than your other credit card purchases, they can also disproportionately affect your credit score. All of these circumstances make banks see cash advances as a risky behavior, which is why withdrawing cash from an ATM using your credit card is best reserved as a worst-case scenario, and not just something you do instead of using your debit card.
What Is a Cash Advance?
A cash advance is a means of borrowing cash against your credit line. Not all credit card companies offer cash advances, but many do. The key thing to keep in mind is that cash advances are often treated differently than normal credit card use, and they typically cost more than a regular ATM…
