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Cash Advances - and why you should avoid them

Using your credit card for a cash advance can be a very expensive way to get your hands on some cash. Cash advances are treated differently from purchases made with your credit card – and that difference can end up costing you in extra fees and interest. 

In this article we’ll explain what a cash advance is, what it means for you, and how to avoid making them – and save money in the process. 

What is a cash advance?

Most people think of a cash advance as using your credit card to get money from an ATM or bank branch. But other types of transactions are counted as cash advances too. It’s important to understand these so you don’t inadvertently make a cash advance without realising it – and incur extra costs that you could avoid.

Cash advances can include using your credit card to:

  • Get cash via ATMs or EFTPOS, or over the counter at a bank or financial institution (this doesn’t include withdrawals from your everyday accounts where your credit card is linked to your everyday accounts). 
  • Buy cash substitutes such as gift cards or prepaid cards, foreign currency, traveller’s cheques, money transfers, wire orders or gambling chips; or topping up gambling accounts (e.g. TAB accounts).
  • Transfer some of your available credit limit from your credit card account to another account you have with your bank or financial institution.

If you’re not sure whether a transaction you’re making counts as a cash advance, check your credit card conditions of use or contact your card provider. 

How cash advances can cost you

The main differences between purchases with your credit card and cash advances are in the fees and interest that apply.

Cash advance fee:

You may be charged a fee to make a cash advance with your credit card. Cash advance fees can vary depending on the specific card you hold and the type of transaction (for example, ANZ only charges a fee for staff-assisted cash advances (cash advances in a branch as opposed to via an ATM). This fee will also be added to your cash advance balance, which means you can also accrue interest on the fee as well as the actual cash advance.

Interest costs:

  • No interest-free days:
    You’ll generally pay interest on cash advances from the day you make them – regardless of whether your card offers interest-free days on purchases. And it’s important to remember that you’ll continue to pay interest on cash advances until your credit card balance is paid off in full.
  • Higher interest rate:
    Many credit cards charge a higher interest rate for cash advances than for purchases with your card (it depends on your specific card).

For details of the fees and interest that apply to your card, check your credit card conditions of use or contact your provider.


If your credit card offers rewards like Cash Back or Airpoints, cash advances don’t usually qualify as ‘eligible purchases’ – so they won’t help you earn rewards. 

Alternatives to cash advances

Alternatives to cash If you need cash, it’s a much better idea to withdraw it from your everyday accounts if you can - for example, using your EFTPOS or Visa Debit card at ATMs. You’ll pay no cash advance fee (ATM fees may apply for withdrawing cash from overseas ATMs) and, if your account remains in credit, you’ll pay no interest costs. 

If you need access to extra cash (for example having to make a big purchase where the vendor will only accept cash), consider applying for a personal loan as the interest rate will generally be lower than a cash advance on your credit card.

And as always, you can contact your bank to discuss a suitable alternative to meet your needs and requirements.

What if you don’t pay off your balance in full by the due date?

At ANZ, to get the benefit of interest-free days on purchases, you need to pay off your balance in full by the due date. If you don’t, you’ll pay interest on your purchases from the day you make them. You’ll also lose the benefit of interest-free days for at least the next statement period. That’s why we recommend always paying off your balance in full each month, if you can.

To regain your interest-free period on purchases, you’ll need to pay off the full balance by the due date in a subsequent statement period.

What about cash advances?

It’s important to remember that there is generally no interest-free period for cash advances with your credit card. If you make a cash advance from your credit card account, you’ll pay interest on it from the date of the cash advance. That’s why we recommend you use your everyday account for cash withdrawals instead.

To find out whether interest-free days apply and how they work for your card, please check your credit card conditions of use or talk to your bank or card provider.

Information in this article refers to personal credit cards, is general in nature only and does not take into account your personal objectives, financial situation or needs.The information may not reflect how interest and charges are calculated under your credit card conditions of use.

By providing this information ANZ does not intend to provide any financial advice or other advice or recommendations. You should seek independent financial, legal, tax and other relevant advice having regard to your particular circumstances.

The information is current as at August 2020 and may be subject to change. ANZ recommends you review your personal credit card conditions of use for information about the terms that apply to you.

Interest rates are subject to change.

Lending criteria, terms, conditions and fees apply to all ANZ credit cards. See Rates, fees and agreements for more information