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  • Looking for a way to access quick and convenient cash without having to dip into your savings might seem like an unrealistic hope, but with a cash advance, you can do just that.

    While not advised due to the high charges associated with them, cash advances are an option for when all else has been exhausted.

    What Is a Credit Card Cash Advance

    A credit card cash advance is way to obtain money immediately by means of making a withdrawal through your credit card. Cash advances can be made at ATM’s as well as at bank branches and through online banking.

    Cash advances also carry a limit and banks will mention the amount of money you can withdraw as a cash advance in your credit card statement. This amount is usually your credit limit or an amount lower than your credit limit.

    A cash advance can be made through an ATM in a manner similar to a cash withdrawal using a debit card.

    When visiting a bank branch for a cash advance, you will have to hand over your credit card and the teller will provide you with the amount of money you have asked for, subject to your cash advance limit.

    Cash Advance Fees

    As stated earlier, cash advances are chargeable transactions made on your credit card. Like all credit purchases, a cash advance also attracts interest. In the case of purchases charged to your credit card, your outstanding amount will attract interest only if the full amount has not been paid by the due date. However, unlike other credit purchases, the cash advance will begin accruing interest from the day the cash advance is made.

    Cash advances have a separate upfront charge, which will reflect in the credit card statement. The fee differs from bank to bank, but the minimum is usually 2.5% of the amount being withdrawn.

    This fee is chargeable over and above your regular credit card interest charges, which could result in you paying a high sum if you already have an outstanding unpaid balance on your credit card.

    Cash advances attract a higher interest rate as banks view them as high risk. Customers who make cash advance transactions may be unable to repay the amount loaned to them through the cash advance, resulting in the bank having to write off that amount. Unlike credit card transactions, banks are unable to recover the amount they loan you as a cash advance. This makes them riskier than loans, since all loans require a collateral, which the bank can claim in case the customer does not return the amount, while cash advances do not.

    Points to Remember Regarding Cash Advances

    A cash advance might not be a good financial decision, but if it’s a last resort, here are some points you should keep in mind before making that withdrawal:

    1. Payment allocation

    If you’re only making the minimum payment on your credit card for a particular bill cycle and if you’ve made a cash advance, the payment will go towards your outstanding balance and not towards your cash advance. This is because banks choose to pay off amounts with a lower interest charge by default. Since your cash advance attracts a higher interest right from the day the advance is made, this transaction would be a much higher amount. If this amount is carried forward to your next billing cycle, you would be paying a very high interest rate. To avoid such a situation, it is advisable to pay your minimum balance and the amount of the cash advance.

    1. Read the fine print

    Each bank has its own terms and conditions regarding cash advances and the interest applicable on them. In some cases, the terms differ for different types of credit cards as well. To avoid being charged extra, you should always go through the terms and conditions for your specific credit card on the bank’s website or in the material sent along with your card.

    1. Pay off cash advances immediately

    Cash advances accrue interest from the day the advance is made. In other words, there is no grace or interest-free period when it comes to cash advances. To avoid paying a hefty fee in terms of interest on this transaction, consider paying off the cash advance as soon as possible if you have no other transactions on your credit card.

    1. Purchases to avoid on your credit card

    While a cash advance is generally perceived to be a withdrawal of funds from your credit limit, banks also consider other transactions charged to your credit card as cash advances and levy high interest charges on these transactions. Avoid paying for these on your credit card to prevent being charged a higher interest rate:

    • Traveller’s cheques.
    • Foreign currency.
    • Gambling and lottery tickets.
    • Using an ATM abroad for a cash advance.
    1. No purchase protection

    A number of banks offer purchase protection of up to 6 months on purchases made through a credit card. However, this privilege does not extend to purchases made with cash advances.

    A cash advance is something to be avoided due to the charges and risks associated with them. If, however, you have exhausted all other options, keep in mind the tips provided above and try to keep cash advances to a minimum to ensure you have a healthy line of credit.

      

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    Credit Cash Advance Reviews

    • IndusInd Bank Credit Card
      "Good"
      0.5 5.0/5 "Blown Away!"
      I received a card on time which was applied through an online with INDUSIND bank. It is a life time free credit card. The credit limit is given was okay because I was expecting more than that. So far no issue faced by using this card. Their service is good.
      Was this review helpful? 4
      , mumbai
      Reviewed on Oct 17, 2019
    • HDFC Bank
      HDFC Bank Credit Card
      "Need to enhance the credit limit"
      0.5 3.0/5 "Satisfactory"
      For the past 2 years I am using HDFC BANK credit card for more than 2 years with low credit limit of 21 thousands only for 2 years I am using this card yet they have not enhance it. It is a life time free credit card. EMI option is applicable and charges are nominal.
      Was this review helpful? 2
      , hyderabad
      Reviewed on Oct 17, 2019
    • SBI Cards Credit Card
      "Need to enhance the credit limit"
      0.5 3.0/5 "Satisfactory"
      I have been holding SBI credit card for more than 3 years. It is an annual fee chargeable of 2000 rupees and there is no option for a waiver off. The credit limit is sufficient for 50 thousands only. EMI option is applicable for this card and it is nominal.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Oct 17, 2019
    • ICICI Bank Credit Card
      "Good Service"
      0.5 5.0/5 "Blown Away!"
      I have ICICI Bank credit card which was taken through Bank directly .I am using this credit card for the past 2.5 years ,The credit limit was very less and there was no difficulties faced so far ,I have got the credit card on time without any hassle and this card is really good to use .
      Was this review helpful? 2
      , hyderabad
      Reviewed on Oct 17, 2019
    • IndusInd Bank Credit Card
      "Excellent"
      0.5 5.0/5 "Blown Away!"
      The reason for taking Indusind Bank Ltd credit card because of the higher credit limit. I have used the card and made a payment as well without any difficulty. The credit limit is more than sufficient. They did not inform me about the reward points. The documentation process is easy.
      Was this review helpful? 0
      , chennai
      Reviewed on Oct 17, 2019
    • RBL Bank Credit Card
      "Good Service"
      0.5 3.0/5 "Satisfactory"
      I am holding RATNAKAR BANK credit card for more than 2 years. It is an annual fee chargeable card of 1000 rupees and there is an option for a waiver off for a certain amount of usage. EMI option is applicable and charges are nominal. I use this card for many purposes.
      Was this review helpful? 2
      , hyderabad
      Reviewed on Oct 17, 2019
    • IndusInd Bank Credit Card
      "Excellent Service"
      0.5 5.0/5 "Blown Away!"
      I have Indusind Bank credit card which was taken through Online .I have got the credit card on delay basis it took 1month time that was the difficulty faced by me .The credit limit was good and this was a free card .I am really satisfied with the service so far .There was no cash back offers and reward points .
      Was this review helpful? 1
      , hyderabad
      Reviewed on Oct 17, 2019
    • Citibank Credit Card
      "Good Service"
      0.5 3.0/5 "Satisfactory"
      I have Citi Bank credit card for the past 1 year .I am using this credit card for the past 1year .I have got all the required details about the card process ,I have got this credit card on time without any hassle .The credit limit was pretty good and there was no drawbacks faced .I am satisfied with the service .
      Was this review helpful? 0
      , mumbai
      Reviewed on Oct 17, 2019
    • RBL Bank Credit Card
      "Good Service"
      0.5 5.0/5 "Blown Away!"
      I have Ratnakar Bank credit card which was taken through Bank .I am using this credit card for the past 1 year and it was a chargeable card ,I have got my credit card on time without any delay .The credit limit was really good and there was no drawbacks faced .I am realy satisfied with the service .
      Was this review helpful? 0
      , mumbai
      Reviewed on Oct 17, 2019
    • SBI Cards Credit Card
      "Good Service"
      0.5 4.0/5 "Great!"
      I have State Bank OF India credit card which was taken through Bank direclty.I am using this credit card for the past 6 years .I have got good credit limit and there was no difficulties faced while using tis card .It is very easy to use and very comfortable as well .I am satisfied with this credit card so far.
      Was this review helpful? 1
      , mumbai
      Reviewed on Oct 17, 2019
    • HDFC Bank Credit Card
      "Good Service"
      0.5 5.0/5 "Blown Away!"
      I have HDFC Bank credit card which was taken through Bank.I am using this credit card for the past 6 years .I have got all the required details about the card process ,I have got my credit card on time without any details .The credit limit was really good and there was no drawbacks faced .I am totally satisfied with the service .
      Was this review helpful? 2
      , mumbai
      Reviewed on Oct 17, 2019
    • IndusInd Bank Credit Card
      "Good Service"
      0.5 4.0/5 "Great!"
      I am using Indusind Bank credit card which was taken through Online .The credit limit was very good it was upto 1 lakh it was sufficient .I have got all the required details about the card process.I have not faced so far on using this card .This was a free card .I am totally satisfied with the service .
      Was this review helpful? 0
      , mumbai
      Reviewed on Oct 17, 2019
    • Kotak Credit Card
      "Good Service"
      0.5 5.0/5 "Blown Away!"
      I have Kotak Mahindra Bank credit card which was taken through Bank .I am using this credit card for the past 4 years ,This card is very easy to use and there was no difficulties faced so far .I am really satisfied with the service .I am comfortable with the service so far.
      Was this review helpful? 1
      , bangalore
      Reviewed on Oct 17, 2019
    • RBL Bank Credit Card
      "Good Service"
      0.5 5.0/5 "Blown Away!"
      I have Ratnakar Bank credit card which was taken through Bank directly. I am using this credit card for the past 1 year and got all the required information about the card process very clearly . This was a chargeable card and the credit limit was really good and it was 1,52,000. I am completely satisfied with the service.
      Was this review helpful? 1
      , bangalore
      Reviewed on Oct 17, 2019
    • IndusInd Bank Credit Card
      "Need to enhance the credit limit"
      0.5 5.0/5 "Blown Away!"
      I received a card on time which was applied through an online with INDUSIND bank. It is a life time free credit card. The credit limit is given for 75 thousands which was low because I was expecting more than a one lakh. EMI option is applicable. I have been using this card for shopping, fuel and restaurant purpose.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Oct 17, 2019
    • SBI Cards Credit Card
      "Very Nice to use"
      0.5 3.0/5 "Satisfactory"
      In SBI, they are providing a voucher if i pay the annual fee of Rs. 3000 and if i use more than Rs. 5000 yearly, the annual fee is getting waived off. In SBI, i have a prime card. They gave me a credit limit of Rs. 50000. Customer care service is good.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Oct 17, 2019
    • IndusInd Bank Credit Card
      "Very Good to use"
      0.5 5.0/5 "Blown Away!"
      They have given me a nice offers and the rewards points will be nice when I'm getting in a shopping. I have got the credit limit of Rs. 1 lakhs. There is a annual fee of Rs. 3000 but i can pay this by using the rewards points. I have got the first month bill and i have to pay on 24th of this month. The statement is clear to understand.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Oct 17, 2019
    • ICICI Bank Credit Card
      "Good Service"
      0.5 5.0/5 "Blown Away!"
      I have ICICI Bank credit card which was taken through Bank directly.I am using this credit card for the past 4 years and got all the required information about the card process very clearly .This was a free card and and there was no difficulties faced so far on using this card .
      Was this review helpful? 1
      , bangalore
      Reviewed on Oct 17, 2019
    • SBI Cards Credit Card
      "Good Service"
      0.5 5.0/5 "Blown Away!"
      I have State Bank Of India credit card which was taken through Bank.I am using this credit card for the past 4 years.This was a free card and there are good reward points as well as cash back offers .I have submitted the required documents very clearly .There are good reward points as well as cash back offers .I am satisfied with the service so far.
      Was this review helpful? 1
      , bangalore
      Reviewed on Oct 17, 2019
    • IndusInd Bank Credit Card
      "Good"
      0.5 5.0/5 "Blown Away!"
      I have applied for a credit card with INDUSIND bank on two months before which was processed through an online. Within 2 days I received a call from their end once verification completed by 15 days I received a card. The credit limit is low as per my requirement. EMI option not aware. There was some requirement so I have chosen to apply for it.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Oct 17, 2019
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