1 min read
24 Nov 2023

Credit card cash withdrawal

Apart from swiping your credit card at stores or making purchases online, you can also use your credit card for a cash advance. This means that you can withdraw funds from an ATM just like you would with a debit card. While this requires no additional documentation, withdrawing cash using a credit card isn’t the same as withdrawing money using a debit card. To understand what this means, take a look at all you need to know about credit card cash withdrawals.

How to use a credit card at an ATM

Withdrawing cash from an ATM is now simpler and more convenient with Bajaj Finserv RBL Bank SuperCard. You can easily use your credit card to withdraw money from an ATM. Here’s how you can use your SuperCard to withdraw money from an ATM. Firstly, you need to find an ATM that accepts the type of credit card you have. Once you find a compatible ATM, insert your card into the machine’s card slot. The machine will read your card, and you will be prompted to enter your PIN number. Make sure that you enter your PIN correctly as the machine will not allow you to proceed without the correct PIN.

Once you enter your PIN number, you can select the ‘cash withdrawal’ option on the ATM screen and enter the amount you want to withdraw. The machine will ask you to confirm the transaction, after which it will dispense your money. Remember to collect your SuperCard before you leave the ATM.

It is essential to note that using your SuperCard to withdraw cash from an ATM will incur a cash advance fee and an interest rate on the cash advance amount. This fee and interest rate vary depending on your card provider and the specific terms of your credit card agreement.

Using your credit card to withdraw cash from an ATM is a useful feature that can help you in times of financial need. It is essential to use it wisely and always keep your credit limit in mind to avoid overspending.

Benefits of credit cash withdrawal

The main benefit of credit cards with cash withdrawal facilities is access to instant finances. You may not have sufficient money in your savings account at all times. In these cases, credit cards like Bajaj Finserv RBL Bank Credit Card and Bajaj Finserv DBS Bank SuperCard can help you avail of interest-free* cash withdrawals for up to 50 days. 

The limit you can withdraw

Not all credit cards have similar services. So remember that not all issuers give you this option, and even those who do, have varying cash advance limits. Therefore, you should always check with your financial institution to know if your credit card comes with the option of cash withdrawal. Once your issuer confirms that it does, enquire about the limit you can use. Usually, financial institutions allow you to withdraw 20% to 40% of your credit limit from an ATM.

Additional read: Credit card cash withdrawal charges and interest rate

What are the charges on credit card cash withdrawal?

The credit card cash withdrawals fee on the Bajaj Finserv co-branded credit card comprises two main components. The first component is the cash advance fee, which is typically a percentage of the amount you withdraw. This fee can range from 2% to 5% of the withdrawal amount and is charged upfront.

The second component is the ATM cash withdrawal fee, which is a fixed amount charged by the ATM operator every time you use your credit card to withdraw cash. This fee can vary depending on the particular ATM operator and is typically between Rs. 100 to Rs.150 per transaction.

It is important to note that these fees can quickly add up, resulting in significant financial implications if not managed effectively. Therefore, it is best to use credit card cash withdrawals only when required and be aware of the charges and fees associated with this feature.

The effect on your credit score

While withdrawing cash using your credit card will not directly affect your credit score, it can have an indirect effect. If you fail to repay the amount and the associated charges, your credit score will certainly bear the brunt.

One way to avoid these inconveniences and still be able to withdraw cash from credit cards is to opt for a card that makes this feature affordable. For instance, the Bajaj Finserv RBL Bank Credit Card offers a cash withdrawal facility that remains interest-free for up to 50 days. This means that you can take up to 50 days to repay the withdrawn amount without paying any interest. Further, you can also borrow an emergency loan once a year for up to 90 days at a nominal interest rate. In addition, the Bajaj Finserv RBL Bank SuperCard gives you offers and discounts on everything from apparel to hotel bookings. To access these features and annual savings of up Rs. 50,000 as possible, check your credit card offer and apply.

Additional read: How to choose right credit card for yourself?

Advantages of Credit Card Cash Advance

As and when you do not have enough bank balance, you can take advantage of the Bajaj Finserv co-branded credit cards cash withdrawal facility for emergency needs. Using these cards, you can withdraw cash amounting to the available credit limit.

  • You can avail of interest-free withdrawal* for up to 50 days
  • You will need to take a person loan that can cost a high interest rate

Disadvantages of Credit Card Cash Advances

While credit card cash advances may seem like a convenient option when you need quick access to cash, there are several disadvantages to consider.

  • Firstly, cash advance fees are typically higher than other credit card transaction fees, and ATM withdrawal fees can also add additional costs.
  • Secondly, the interest rates for credit card cash advances can be significantly higher than regular credit card transactions, meaning that you will incur a higher level of debt once the interest starts accumulating.

Given these disadvantages, it is advisable to use credit card cash advances only when necessary and to be aware of the fees, interest rates, and impact on your credit score.

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Frequently asked questions

Can we withdraw money from credit card?

Yes, you can withdraw money from a credit card through a process called cash advance. You can use your credit card at ATMs to withdraw cash, but this typically comes with high fees and interest rates. It's important to note that cash advances usually incur interest immediately and may not have a grace period like regular credit card purchases.

Can I transfer money from credit card to bank account?

Yes, you can transfer money from a credit card to a bank account, typically through a feature known as a balance transfer. However, this process usually incurs fees and interest charges, making it a costly option. It's advisable to explore alternative methods or consider the financial implications carefully before proceeding with such transfers.