If you need quick access to cash, you can get a short-term loan in the form of a money transfer or cash advance from a credit card. You can transfer money from a credit card to a debit card, and the process is a fairly straightforward and simple one. However, expect to get hit with a fee and interest charges. Plus, you’ll be on the hook for paying back the transferred amount.
Read on to learn how to transfer money from a credit card to debit card, what to consider when doing so, and the fees involved — as well as alternatives you might explore instead.
What Is a Money Transfer Credit Card?
As the name implies, a money transfer credit card is a card that allows you to move money from your credit card to a debit card or to your bank account.
Many credit card issuers allow you to make a credit card advance. As a cardholder, you can take out a certain amount of cash against your line of credit, which is what a credit card is. These cash advances usually come with fees.
Can You Transfer Money From a Credit Card to a Debit Card?
While it’s typically more common to transfer a cash advance from a credit card to a bank account, you can send money from a credit card to a debit card. You can make a money transfer to a debit card in your own name, or to another account holder, effectively allowing you to send money to your loved ones using a credit card.
The credit card process for how to transfer credit card money to a debit card is fairly similar to moving money from a credit card to a bank account. Usually, you’ll need to provide the following information:
• Name on the card
• Card number
• Expiration date
• Bank account number (in some cases)
Recommended: What is the Average Credit Card Limit?
Factors to Consider Before Transferring Money from a Credit Card
Before you transfer money from a credit card to a debit card, here are a few thing to mull over:
• There are caps on a cash advance. Credit cards usually have a cap on a cash advance. The exact limit depends on the rules for a credit card set by the credit card issuer. For instance, it might be a set amount, such as $5,000, or it might be a percentage of your personal credit limit, such as 15%.
• You might have to step foot inside a bank. If your credit card has a PIN, similar to a debit card, then you’ll be able to get a cash advance from an ATM. But if you want to do a proper money transfer from a credit card to your bank account or debit card, you might need to go to a brick-and-mortar location of a physical bank.
• Cash advances could have an impact on your credit score. The good news is that cash advances don’t require a hard pull of your credit, which could hurt your score. However, taking out a cash advance can impact your credit by increasing your credit utilization ratio. That’s because carrying a higher balance ups your credit usage, which in turn can bring down your score.
• You won’t earn rewards. While you’re using your credit card to tap into cash, you won’t earn any rewards or points. That’s because cash advances usually don’t earn rewards.
Recommended: Does Applying For a Credit Card Hurt Your Credit Score?
How Much Does Transferring Money From a Credit Card Cost?
Nothing in life is free, and this includes money transfers from a credit card. Here are some costs that go into a credit card money transfer:
• Cash advance fee: Just like with balance transfer credit cards, you’ll typically owe a fee to do a money transfer from a credit card to either your debit card or bank account. The fee varies depending on the card, and it might be a flat fee or a percentage of the amount of the advance. For instance, the fee might be $10 or 5% of the cash advance amount, whichever is greater.
• Cash advance APR: The annual percentage rate (APR) for a cash advance is usually higher than the standard APR that comes with your card. We’re talking an average of 24%, which is 9% higher than the standard purchase APR. Additionally, with standard purchases on a credit card, you have a grace period between the end of the billing period and the date your payment is due. During that time, you won’t be charged interest. When you transfer money from a credit card to a debit card, however, there’s no grace period. That means you’ll be charged interest from the time you take a cash advance.
• Late charges, if applicable: If you’re late on a payment, you’ll most likely get hit with a late fee.
Recommended: What is a Charge Card?
Is It Safe to Transfer Money From a Credit Card to a Debit Card?
For the most part, transferring money from a credit card to a debit card is pretty secure. Banks have built-in security features, so moving money between cards or to a bank account is generally considered safe.
Once you’ve sent your payment, you may want to check in with the intended recipient to ensure they received the funds in the credit card to debit card transfer.
Recommended: When Are Credit Card Payments Due?
Alternatives to Transferring Money From a Credit Card to a Debit Card
Moving money from a credit card to a debit card is just one method of sending money. There are other ways you can tap into your credit card limit in the form of cash, including:
• Writing a check: In lieu of getting that money transferred to your debit card, the credit card company might mail you a check. You can either use it as a personal check or to make a deposit into your bank account.
• Pulling money from an ATM: If your credit card comes with a PIN, you can withdraw money via a cash advance.
• Using a payment app: You can also use popular payment apps like PayPal or Square’s Cash App to send money to someone else with your credit. Once you’ve linked your card, you may have the option to send money to someone else. Keep in mind that you or the recipient will likely incur fees.
And, of course, the ideal path is to avoid taking out a cash advance entirely. If you’re in a pinch, you could also explore options like borrowing money from a friend or family member, taking out a low-interest personal loan, or dipping into your emergency fund. All of these alternatives will allow you to avoid the fees and interest charges that can accompany the transfer money from a credit card to a debit card.
Recommended: How to Avoid Interest On a Credit Card
The Takeaway
A cash advance by way of transferring money from a credit card to a debit card could be a quick, easy way to access money. The trade-off is that you’ll be paying high interest charges and a fee. Before doing so, make sure it’s the right choice for you and your needs. Also, be careful not to take more cash than you need, as this will have an effect on your credit utilization.
Whether you're looking to build credit, apply for a new credit card, or save money with the cards you have, it's important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.
FAQ
Can I transfer money from my credit card to my debit card without paying interest?
No, transferring money from your credit card to debit card comes with interest charges. The APR for a cash advance is typically higher than the standard APR on the card. Plus, you won’t get a grace period, so interest will begin accruing immediately.
Is it better to get a personal loan or transfer money from my credit card?
A personal loan is generally preferable to transferring money from a credit card. That’s because it’s possible to find no-fee personal loans, whereas cash advances generally carry fees. Plus, the interest rate on a personal loan is likely lower than the APR you’d be charged on a cash advance.
Can I withdraw cash using a credit card?
Yes, you can take out cash using a credit card as a cash advance. Mind the fees, rates, and fact that there’s no grace period on accruing interest before proceeding.
Photo credit: iStock/Prostock-Studio
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .
SOCC0922026
