Want to know how to withdraw from your credit card? Here's some essential information.
Are you stuck in a financial crisis? Do you need money in an emergency or to pay your bills? Here, you have credit cards at your disposal, with which you can withdraw cash and meet all your financial needs in an emergency.
Credit cards have become one of the crucial financial tools in people's lives today. With the increasing number of features and benefits that credit cards offer, they have become more of a necessity than a luxury item.
In addition to allowing you to pay with your credit card at various online and offline stores, credit card issuers also allow you to withdraw money using a credit card.
The process of withdrawing money from a credit card is as simple as withdrawing money from a debit card, but withdrawing money from a credit card attracts a lot of fees and charges and is therefore not advisable.
Therefore, there are many details that an individual should be aware of once before withdrawing money using their credit card. Here's how to withdraw from your credit card.
How to withdraw from credit card
Withdrawing money from a credit card is a fairly simple task. It's as easy and effortless as using a debit card.
You will first have to check with your credit card issuer whether or not you have the cash advance feature available on your credit card.
Once you are sure that the feature is available on your card, you can follow the instructions provided below and successfully withdraw money using your credit card.
See the steps on how to withdraw from your credit card:
- Visit the nearest ATM.
- Insert your credit card into the card slot provided at the ATM.
- Enter the amount you would like to withdraw.
- Then enter your PIN.
- The requested amount will be dispensed through the cash dispensing area.
Charges applicable to credit card transactions
Although the process is just as simple as in the case of a debit card, in the case of a debit card, it's your own money that you withdraw from an ATM, but in the case of a credit card, it's a type of loan that you take out from the bank.
Therefore, only use this resource when it is really necessary, as you will pay interest rates that vary from one bank to another.
Credit Card Cash Advance Fee
A credit card cash advance fee is a fee charged by credit card companies to credit card holders in lieu of accessing the cash advance feature available on their credit card via an ATM.
The cash advance fee differs from bank to bank, but is usually a specific percentage of the amount withdrawn, but subject to a minimum amount of cash for small transactions.
Interest
Whenever you swipe your credit card for a specific transaction, you get an interest-free period of 30 to 45 days.
This is a period of time for which you do not have to pay interest. Bill payments made after this date will attract interest charges. But these criteria are quite different in the case of cash withdrawals.
Interest begins to accrue on such cash withdrawal transactions as soon as you withdraw money from your credit card. Interest rates differ from bank to bank and card to card. These generally range from 2.5% to 3.5%.
Pros and cons
Pros
The following are some of the benefits of withdrawing money by credit card.
With the help of a credit card cash advance feature, you get instant access to liquid cash. Due to the easy availability of ATMs and having a credit card in hand, you can have cash anytime, anywhere. That's why it's the best alternative for cashing out in times of emergency.
While you have to present various documents and wait for approval when you want to take out any kind of personal loan, in the case of withdrawing money by credit card, you don't need to present any documents or wait for any kind of approval. Simply go to the nearest ATM and withdraw money.
Cons
Where there are advantages, there are also disadvantages. Below are some of the disadvantages of withdrawing money using a credit card.
Interest starts to accrue on these transactions from the first day of the cash withdrawal until the day the amount is paid in full. Because of this, it is very expensive to withdraw money from a credit card.
Whenever money is withdrawn from a credit card, in addition to interest, you also have to pay a advance fee in cash, which is a certain percentage of the amount you withdraw with your credit card.
You don't get any interest-free period when you withdraw money from your credit card, otherwise you get it with other credit card transactions.
Now that you know how to withdraw from your credit card, tell us about your experience by leaving a comment below this post.
