woman withdrawing money on an atm

How Much Does a Cash Advance Cost?

Learn about the fees and charges that apply when you use your credit card for a cash advance and how to avoid them.

A cash advance is a type of credit card transaction where you get cash or an equivalent. While ATM withdrawals are the most common type of cash advance transaction, others could include buying gift cards, paying bills, gambling or purchasing foreign currency.

Despite the fact that we’re making fewer trips to the ATM, the number of Australians using their credit card for a cash advance is on the rise. While it may be convenient, using your credit card for this reason is expensive, attracting additional fees and high interest charges. Read on to find out the potential costs and how to reduce them.

How much does a cash advance cost?

You can view a range of cash advance interest rates and fees charged by major financial institutions in the following table. These rates vary between cards, so it’s still important to check the details of your individual credit card for specific fees that will apply to you.

Credit card issuer Cash advance interest rate Cash advance fee
ANZ 14.49% p.a.–21.74% p.a.The greater of 2% or $4.00
Bankwest 21.99% p.a.The greater of 2% or $4
Citi19.99% p.a.–21.74% p.a.3.5% of transaction amount
Commonwealth Bank 14.55% p.a.–21.74% p.a.$2.50 or 2% of the transaction amount (whichever is greater)
HSBC 21.99% p.a.The higher of $4 or 3.0% of the total transaction amount
NAB13.25% p.a.–21.74% p.a.2% or $2.50, whichever is greater
St.George20.24% p.a.–21.49% p.a.2% of each cash advance amount and all transfers with a minimum of $2.50
Suncorp Bank 19.45% p.a.–21.99% p.a.3.5% of transaction amount, minimum charge of $3.50
Westpac 18.99% p.a.–21.49% p.a.2% of the transaction amount or $2.50

* Table details current as of 28 September 2016
This table gives you a clear idea of just how expensive cash advances can be, with most interest rates between 17-21.99% p.a. And while the lowest fee is just $2.50, generally you’ll pay a percentage of the total transaction amount, which ranges from 2–3.5%. To put that in perspective, if you withdraw $1,000 from an ATM with a Citi or Suncorp credit card, you will pay a fee of $35, and that’s not counting the interest charges.

When would I be charged cash advance fees and interest rates?

Some of the most common transactions that attract fees and rates include:

  • ATM withdrawals. Using your credit card to withdraw cash at an ATM attracts cash advance interest and fees. ATM fees can apply as well. Some credit card companies allow you to preload your own money on your credit card so you can avoid interest and fees when you withdraw cash.
  • Gift cards. Using your credit card to buy gift cards is usually defined as a cash advance because the money loaded onto the card is equivalent to cash.
  • Prepaid cards. As a prepaid card gives you access to funds you can use for almost anything, buying or loading money onto one with a credit card will typically attract the cash advance fee and interest charges.
  • Balance transfers. Balance transfer promotional rates revert to the purchase rate or the cash advance rate of interest at the end of the introductory period. Have a look at our balance transfer credit card review and application pages to find out about the revert rate.
  • Gambling purchases. Using your credit card for gambling purchases such as online poker may be treated as a cash advance. Find out if you can use your credit card for gambling purchases and whether it will incur charges.
  • Foreign currency. Financial institutions treat the purchase of foreign cash or travellers cheques as a cash advance.
  • Online transfers. Online money transfers from your credit card account to your transaction or savings account is a cash advance.
  • Utility payments. Some credit card companies apply cash advance rates and fees to payments for utilities such as gas, electricity, phone and Internet accounts.
  • Government payments. In some instances, government charges such as payments to the ATO could be processed as cash advances and attract these fees and charges.

Which credit card transactions are treated as a cash advance?

Other important facts about credit card cash advances

Reasons why cash advances are so expensive.

  • Higher rates than purchases. The cash advance interest rate can be more than double the purchase rate of interest.
  • No interest-free days. Unlike purchases,cash advance transactions are not eligible for interest-free days. The transaction accrues interest at the cash advance rate of interest from the time it is made until you pay it off in full.
  • Cash advance fees. This fee is charged for each cash advance and is the greater of a percentage of the cash advance amount or a flat fee, for example $2.50 or 2%. Cash advance fees are added to your cash advance balance and accrue interest at the cash advance rate immediately.
  • Overseas cash advances. If you use your card for cash advances while you’re overseas, a higher cash advance fee may apply from your bank. Plus, local ATM fees may also apply on international cash advance transactions.
  • Cash advance limits. The amount of advanced cash you can withdraw in one day is capped by credit card companies, typically at around $800–$1,000 per day, or as a percentage of your credit limit.
  • Repayments. If you have multiple balances accruing interest on one card (such as purchases, cash advances and a balance transfer), those that attract the highest interest charges will be paid first when you make a repayment to your credit card. This usually means cash advances are repaid first, purchases second and balances eligible for low-interest promotions (such as a balance transfer) last.
  • No points. Cash advances are ineligible for points if you have a rewards or frequent flyer credit card.

Important things to know about using your credit card for cash advances.

Compare credit cards with no cash advance fees

Rates last updated December 13th, 2017
Name Product Purchase rate (p.a.) Balance transfer rate (p.a.) Annual fee Product Description
ANZ Rewards Travel Adventures card
20.24% p.a.
$225 p.a.
Receive 40,000 bonus Velocity Points (when you meet the spend criteria), 2 yearly Virgin Australia lounge passes, plus enjoy paying a $0 overseas transaction fee on purchases.
ANZ Rewards Black Credit Card
18.79% p.a.
$0 p.a. annual fee for the first year ($375 p.a. thereafter)
Receive 75,000 bonus points when you meet the spend requirement. Plus, complimentary travel insurance and a $0 annual fee for the first year.
American Express Business Card
$109 p.a.
Earn up to 1.00 Membership Rewards point per $1 spent and extend your cashflow with up to 51 interest-free days on purchases.
American Express Velocity Business Card
$249 p.a.
Take advantage of Velocity Points per $1 spent, no pre-set spending limit, data that feeds into MYOB and up to 51 days interest-free on purchases.
American Express Velocity Platinum Card
20.74% p.a.
0% p.a. for 12 months with 1% balance transfer fee
$375 p.a.
Receive 50,000 bonus Velocity Points, a complimentary Virgin Australia return Economy domestic flight each anniversary year, plus, 2 lounge passes.
American Express Platinum Business Card
$1,500 p.a.
Enjoy 120,000 bonus points, a platinum business concierge, complimentary Virgin Lounge access, worldwide travel insurance and hotel benefits.
American Express Platinum Card
$1,200 p.a.
Receive an annual $300 Platinum Travel Credit, 80,000 bonus Membership Rewards points and access to more than 1,100 VIP lounges.
American Express Gold Business Card
$169 p.a.
Take advantage of 10,000 bonus points, no pre-set spending limit, data that feeds to MYOB and up to 51 days interest-free on purchases.

Compare up to 4 providers

Using your credit card at the ATM is significantly more expensive than using it to purchase goods and services. If you regularly use your card for cash advance transactions, you may want to consider looking for ones with a promotion on cash advances. You can use these credit cards to withdraw cash for less during the promotional period. Cash advance fees can still apply.

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Sally McMullen

Sally McMullen is an editor at finder.com.au who is a credit cards, frequent flyer and travel money expert by day and music maven by night.

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