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You can transfer money from your credit card to your bank account, but beware – credit cards are not designed to be used this way so it’ll cost you big. You’ll pay a small cash advance withdrawal fee and a high interest rate that kicks in immediately. If you need funds fast, consider other alternatives first.
Better alternatives to taking out a cash advance
Since cash advances are expensive, consider these other options first if you need funds in a hurry.
Personal loan. A personal loan may be one of your best options. If you have decent credit, you may also qualify for a low rate personal loan – which means you’ll get a better interest rate than your cash advance APR. You could also get funds in your bank account within 24 hours or less depending on the provider.
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Borrow from friends or family. You may find someone in your network who is willing to help you.
Chequing account overdraft. If you have overdraft protection on your chequing account you can debit below a $0 balance to whatever your overdraft limit is. Most banks offer this allowance for a small fee each month. Keep in mind that your balance will be in a deficit until you deposit enough funds to bring it back to $0.
Take from a rainy day fund. If you’ve set aside a rainy day fund, an emergency situation might be the perfect time dip into those savings. If you don’t have a rainy day fund yet, now could be the perfect time start building up those savings.
3 factors to consider before transferring money from a credit card
Cash advances are expensive, and you’ll start being charged interest immediately. If cash isn’t required and you have the option to pay with credit, then paying for the expense directly on your credit card is going to be cheaper then getting a cash advance. Credit card cash advances should only really be used for emergencies where cash is required – and after you’ve exhausted other less expensive alternatives. Before you take out a cash advance, consider these 3 important points:
You’ll pay a cash advance fee. A common cash advance fee is between $2.50 – $5 per transaction. This is separate to what you will pay in interest.
Look out for the cash advance rate. The average cash advance rate is 22.99% which is higher than normal credit card purchase rates or balance transfer rates which usually don’t exceed 19.99%. If you think you might need a cash advance in the future, consider getting a credit card that comes with a lower cash advance rate, like the ones in the table below.
4 ways to transfer money from a credit card to a bank account
Remember that with any of these methods, you may have to pay fees and/or special interest rates. Here are 4 ways to transfer funds from your credit card into a bank account:
1. Withdraw from an ATM
You can withdraw the cash you need from your credit card by using an ATM. To do so, first insert your credit card into an ATM, enter your credit card PIN and you’ll be given the option to withdraw cash from your credit card. Once you have that cash, you can then use the ATM to immediately deposit the money into your bank account. Many banks allow deposits through ATMs, but if your bank does not allow ATM deposits, you can make your deposit at a branch.
This option is quite similar to withdrawing cash at an ATM, but instead, you would go to your bank branch and withdraw cash directly from a teller. To get the money in your bank account, you can then deposit the cash immediately at the teller. Withdrawing cash from a credit card at an ATM is also considered a cash advance, so you’ll be charged any applicable cash advance fees or special interest rates.
3. Online transfer directly into your account
Most banks offer convenient online banking. Instead of visiting a teller or ATM, you can easily transfer funds from your credit card to your bank account via an online transfer between these accounts as long as they are issued from the same institution. Just make sure you are registered for online banking. If you’ve downloaded your bank’s mobile app, you can also transfer money from your credit card directly to your bank account through the app. In fact, you can handle most of your financial transactions using only your phone or tablet.
4. Use a credit card convenience cheque
Your credit card provider may occasionally issue you complimentary credit card convenience cheques. When you write one, it’s as if you’ve swiped your credit card. The amount you put on the cheque will be drawn from your credit card — you have to pay it back eventually. You can write a credit card cheque for the amount you want to transfer to your bank account then deposit the cheque at your branch or by using your bank’s mobile app just as you would with a regular cheque.
Carefully read your provider’s fine print before using one of these cheques. Be aware that you normally start paying interest from the date you use it. If you’re lucky, you’ll get a promotional interest rate on it. Otherwise, the cheque will be treated as a cash advance.
Can you e-transfer from a credit card?
There’s no way to directly email transfer (or e-transfer) money from a personal credit card to a bank account in someone else’s name or at a different bank. If you do want to e-transfer money from a credit card, you’ll first have to transfer the money into your personal bank account using one of the 4 methods described above. Once the money is in your chequing account, you can use Interac e-Transfer or some other email transfer service to e-transfer the money from your account as usual.
How does a credit card cash advance affect your credit score?
Cash advances don’t directly impact your credit score. But if you don’t pay off your credit card balance within your statement period, then your higher credit card balance will increase your credit utilization ratio, which could negatively impact your credit score.
Compare credit cards with low cash advance rates
If you’re going to withdraw or transfer cash using your credit card, it’s best to use a card that comes with a low cash advance APR. Compare credit cards with low cash advance rates in the table below.
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You can transfer money from a credit card to a bank account — but it might cost you more. Consider the costs you might incur with a cash advance, which likely comes with a higher interest rate and transaction fees. If you have time, consider the alternatives to a cash advance. You’ll find many reputable services that can help you if you’re in a financial pinch.
Frequently asked questions
Many personal finance experts say you should consider payday loans as a last resort. You must repay these loans very quickly, and they usually have sky-high interest rates. Consumers who take out payday loans often find themselves trapped in debt cycles that can snowball.
You'll commonly see APRs upward of 22% variable interest. These are very high rates, so avoid them if possible.
After your credit card billing cycle closes, your card provider will bill you the amount you've spent. You'll typically have a grace period of 21 to 25 days to pay your balance. If you do, the balance won't incur interest.
Chelsey Hurst is an associate editor at Finder. She loves empowering people to avoid financial pitfalls and make better decisions with their money. Chelsey has a Bachelor of Science from Redeemer University, a Master of Science from McMaster University, and has won multiple awards for research communication. In her spare time, Chelsey enjoys cooking and taking long walks in nature.
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