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Cash advances allow credit card users to withdraw a sum of money from their card’s line of credit. Credit card companies provide them as short-term loans. Borrowers can take out funds up to their card’s cash advance limit, which is different from their overall credit limit but may also make up a portion of it.
When a borrower uses their credit card to make a regular purchase, there is a grace period for interest until the due date at the end of the month. With a cash advance, interest starts accruing immediately, meaning there is no grace period. The APR for a credit card cash advance will differ from the APR for regular purchases. Borrowers may also be charged a cash advance fee from their card issuer.
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