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Credit Card Cash Advances Explained

A credit card cash advance allows you to withdraw cash with your credit card. Cash advances can be similar to payday loans in terms of the fees and charges applied, a credit card expert warns.

Credit Card Cash Advances Explained

A credit card cash advance allows you to withdraw cash with your credit card. Cash advances can be similar to payday loans in terms of the fees and charges applied, a credit card expert warns.

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Sean Callery Editor Money.com.au
Money.com.au's Senior Finance Writer, Jared Mullane

Written by Sean Callery and fact checked by Jared Mullane. Updated 22 May 2025.

What is a credit card cash advance?

A cash advance is when you use your credit card to withdraw cash, instead of using it to pay for goods or services.

While it might seem like a quick way to access money, cash advances are typically one of the most expensive ways to borrow. That’s because they usually come with:

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  • Higher interest rates than standard purchases
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  • No interest-free period (interest is charged immediately)
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  • Additional fees, such as a cash advance or ATM withdrawal fee

So, if you withdraw $500 as a cash advance, you’ll likely end up paying significantly more than if you’d used your card for a $500 purchase.

Here’s a typical example to show how quickly the costs can add up…

Using your credit card for a purchase versus cash advance

PurchasesCash advances

Fees

None as standard, unless the transaction is in a foreign currency or the retailer applies a surcharge.

Usually 2-3% of the amount advanced.

Interest rate

Varies by card, anywhere between 0% and 23% p.a.

Almost always higher than the purchase rate and sometimes much higher.

Interest-free days

Usually 44 or 55.

None.

Limit

You can make purchases up to the value of your credit card’s overall credit limit.

There is usually a limit on how much you can withdraw as cash from your credit card account per day (e.g. $1,000).

Rewards points

Most purchases qualify for rewards points.

Will not earn you any rewards points.

What transactions count as a credit card cash advance?

These are the most common types of transactions typically treated as a cash advance:

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  • Withdrawing money from an ATM using your card or getting cash out in a store.
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  • Transferring money from your credit card account to another bank account.
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  • Paying a bill in person at a bank or post office.
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  • Buying foreign currency.
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  • Buying cryptocurrency.
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  • Money spent on gambling.
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  • Purchasing prepaid cards (like the ones sometimes given as gifts).
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  • Many credit card providers also classify store gift cards as a cash advance but not all do. This is worth checking before you use your credit card to buy a gift card.
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If you get a balance transfer credit card and do not pay off the balance in full during the introductory period, the card’s cash advance rate usually applies to the remaining balance.

How much does a credit card cash advance cost?

Credit card cash advances can be very expensive. But it’s not a single factor causing this. It's a potent combination of fees, interest and how that interest is applied. Let’s look at each of these factors:
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Cash advance fees

You will be charged a fee simply for using your card to access a cash advance. This is usually a percentage of the transaction value – typically ranging from 2-3% of the cash advance amount, or a flat dollar fee on small amounts.

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Interest on cash advances

The interest rate on cash advances is almost always higher than the interest rate on purchases using the card. In some cases, it’s substantially higher. For example, Money.com.au analysis shows some credit cards have a cash advance rate that’s double the interest rate charged on purchases.

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No interest-free days

With a cash advance, interest starts building up straight away – there are no interest-free days like with regular purchases. On some cards interest may be charged daily, so if you don’t clear the balance quickly, you’ll pay interest on the interest from the day before (compound interest).

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International cash advance fees

If you make use of a cash advance while overseas (e.g. at an ATM while on holiday) you will also likely be charged an overseas ATM fee on top of everything else.

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Let’s say you withdraw $500 in cash using your credit card and then make the minimum repayments allowed to clear the balance. That one withdrawal would cost you $202 in interest and fees and would take two years and 11 months to repay, Money.com.au’s analysis shows. If you repaid the balance in full after 31 days, it would still cost $24.77.

Credit card cash advance

Why are credit card cash advances so expensive?

Brad Kelly, Payment Services

Brad Kelly, Credit Card Expert

"It comes down to risk. The minute a customer is getting a cash advance on a credit card, it raises a red flag for the bank that this customer is a risk. And the bank prices it accordingly. This is not to protect the consumers, it’s to protect the bank. There's basically a payday lending product lurking in your credit card. If you're that desperate that you need cash on a credit card, you will pay for it."

Brad Kelly, Credit Card Expert

Cash advance fees and rates compared

From Australia’s major credit card providers on credit cards that allow cash advances (not all cards do).

Cash advance fee Cash advance interest rate

American Express (only enrolled cardholders approved before 2008 can access cash advances)

$2.50 or 2% of the cash advance amount (whichever is greater), or $1.25 per withdrawal on charge cards.

23.99% p.a.

ANZ

3% of any cash advance (a minimum fee of $4 applies to cash advances made outside Australia)

21.99% p.a.

Bank of Melbourne

3% of cash advance amount

21.99% p.a.

BankSA

3% of cash advance amount

21.99% p.a.

Bankwest

3% of transaction amount or $4 (whichever is greater)

21.99% p.a.

Bendigo bank

$3.00 or 3% of the transaction amount (in AUD), whichever is greater

19.99% p.a. - 21.99% p.a. depending on the card

Citi

3.5% of the transaction amount (minimum of $3.50 applies)

22.24% p.a. - 22.99% p.a. depending on the card

Commbank

$4.00 or 3.00% of the transaction amount, whichever is greater (up to a maximum of $300)

21.99% p.a.

HSBC

3% or $4 of the transaction amount, whichever is greater

21.99% p.a.

St.George Bank

3% of cash advance amount

21.99% p.a.

Suncorp

3.5% of transaction amount (minimum charge of $3.50 applies)

21.99% p.a.

Westpac

3% of the value of the transaction

21.99% p.a.

Virgin Money

2.7% (minimum of $2.70 applies)

20.99% p.a. on all cards except the low rate card (21.69% p.a.)

Correct as of 13 May 2025. Check with the provider for current cash advance rates, fees, terms and conditions.

How to avoid cash advance fees

1

Keep an eye out for transactions classified as cash advances

Review the terms and conditions of your credit card to understand which types of transactions your provider considers cash advances. These can include ATM withdrawals, gambling purchases, bank transfers, and even certain bill payments or money transfer services.

2

If essential, borrow as little as possible

If you must take a cash advance, keep the amount as low as possible. Since fees and interest add up quickly, borrowing only what you truly need can help reduce the overall cost. Remember, a cash advance is still a loan.

3

Pay it off as soon as you can

Repay a cash advance as soon as possible. Interest starts accruing daily with no interest-free period, making it one of the most expensive ways to borrow on your credit card. The sooner you pay it off, the less it will cost.

4

Set restrictions on your credit card

Ask your bank to place limits on your credit card to block specific transactions that may be classified as cash advances, such as gambling. This can help you avoid high fees and interest by preventing risky or unintended charges.

5

Seek support if needed

If you're facing financial difficulties and need cash, get advice before borrowing. There may be better options. Speak with your bank or contact the National Debt Helpline on 1800 007 007 for free, confidential support.

More FAQs about cash advances

Yes, most credit cards allow cash advances. But it comes at significant costs to you as a cardholder, due to the fees charged, the interest applied and the fact that cash advances usually do not come with any interest-free days.

However, some credit cards (such as basic interest-free credit cards) do not offer a cash advance facility. American Express no longer offers a cash advance facility on new cards issued.

A cash advance is when you use your credit card to withdraw cash, transfer money, buy foreign currency or carry out any other cash-like transactions.

You’ll generally be charged a fee for this based on the cash advance amount and you will begin to be charged interest immediately (at a high rate), until the full amount is repaid.

There is usually a limit on how much money you can access through credit card cash advance per day.

Whether or not you have used your credit card to access a cash advance is not recorded in your credit report and therefore won’t impact your credit score.

But if you are applying for a loan, you may need to provide your credit card statements as part of the application process. If there are cash advance transactions on your statement, this could be a red flag for potential lenders.

Let’s say you withdraw $250 using your credit card, and your provider charges a 3% cash advance fee. To calculate the fee, multiply $250 by 0.03 (3%). That equals $7.50, so your total cost is $257.50, not including any interest that starts accruing immediately.

Sean Callery is the Editor of Money.com.au. He has over 15 years of international experience. He is qualified with a Certificate IV in Finance and Mortgage Broking (FNS40821) and is compliant to provide general advice in Tier 1 General Insurance (RG 146) products.

Jared Mullane is a finance writer with more than eight years of experience at some of Australia’s biggest finance and consumer brands. His areas of expertise include energy, home loans, personal finance and insurance. Jared is qualified with a Certificate IV in Finance and Mortgage Broking (FNS40821).

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