What is a cash advance? Three meanings, three prices

The three meanings of cash advance

1. A credit card cash advance

You take cash against your card's credit line at an ATM, or you use a check you received from your card issuer. Unlike withdrawing money from a bank account, the CFPB explains, a cash advance pulls money from your line of credit, and it comes with its own fee and interest rate.

Card agreements count more than ATM withdrawals as cash advances. Capital One defines a cash advance as a loan in cash or things we consider cash equivalents, including wire transfers, travelers' checks, money orders, foreign currency, lottery tickets, gaming chips, and wagers. Bank of America's example agreement also treats person-to-person money transfers, bets, casino gaming chips and cryptocurrency, among other things, as cash advances.

2. A cash advance app

A cash advance app gives you part of your pay before payday and takes it back when you are paid. The CFPB separates two main types of earned wage access, employer-partnered and direct-to-consumer. Direct-to-consumer providers offer access to amounts that they estimate to be below accrued wages, and they generally collect by automated withdrawal from the worker's regular transaction account that receives their paycheck.

Whether an app advance counts as credit depends on how it works. In a December 2025 advisory opinion, the CFPB said that payroll-linked "Covered EWA" is not credit under Regulation Z. One condition is repayment through a payroll process deduction in connection with the worker's next payroll event, and a transfer from your bank account after payday is not a payroll process deduction. The CFPB adds that the opinion does not state, and nothing in it should be understood to state, that EWA products that are not Covered EWA are credit under Regulation Z. State laws differ, so an app's fees and terms can change by state.

What an app costs comes from its own terms: some charge a mandatory fee or a membership, some charge only for instant delivery, and some ask for optional tips. Our 12 app profiles show each one.

3. A payday loan, also called a cash advance

The CFPB describes a payday loan as a short-term, high-cost loan, generally for $500 or less, that is typically due on your next payday. It is usually repaid in a single payment on the borrower's next payday, and the due date is typically two to four weeks from the date the loan is made. To repay, you generally give the lender a post-dated check for the full balance, including fees, or authorization to electronically debit the funds from your bank, credit union, or prepaid card account.

Whether payday loans are allowed, and what they can cost, depends on your state. Check your state's payday loan rules first.

What is a cash advance fee?

On a credit card, it is a fee charged each time you take a cash advance. The CFPB says the fees can be substantial, and that depending on your card the company may charge "a flat fee for withdrawing money, or they'll charge you a percentage of the cash advance." The table shows the fee and APR that three issuers publish, and what $100 for 14 days costs with each.

Interest in these examples starts on the transaction date and uses each card's cash advance APR divided by 365 for each day, on the $100 only. Capital One's agreement says the cash advance fee is treated as a cash advance transaction; on cards like that, interest can also build on the fee. Capital One's consumer cards charge either $5 or 5% of the amount of each cash advance, whichever is greater, with a cash advance APR of the Prime Rate plus a margin between 19.24% and 22.24%. Its agreement lists APRs for offers available as of June 30, 2025, so we do not price a Capital One example.

Apps and payday lenders charge differently. Apps charge advance fees, memberships or instant delivery fees, depending on the app. For a payday loan, the CFPB says the finance charge can range from $10 to $30 for every $100 borrowed, depending on your state law.

How cash advance interest works on a credit card

• It starts right away. Unlike purchases with a grace period, the CFPB says interest on a cash advance starts as soon as you withdraw your money. Chase begins charging interest on cash advances on the transaction date, as does Bank of America, and Wells Fargo begins charging interest on cash advances on the transaction date.
• The rate is usually higher. The CFPB says you'll commonly pay a higher interest rate for a cash advance than you would for a typical credit card purchase. Wells Fargo Active Cash charges 29.74% on cash advances and 18.74%, 24.74% or 28.74% on purchases after the intro period, depending on creditworthiness. Chase Freedom Unlimited charges 28.49% on cash advances and 18.24% to 27.74% on purchases after the intro period. These APRs vary with the Prime Rate.
• The limit is lower. The CFPB says many cards have a separate lower limit for cash advances and checks written from your credit card account.
• Paying it off. If your cash advance carries your card's highest APR, federal rules make the issuer apply any payment above your minimum first to the balance with the highest annual percentage rate.

What $100 costs: card, app or payday loan

Same $100, same 14 days. These are examples from published terms, not offers, and each provider decides whether to approve you.

• Credit card: $6.12 to $11.14 in our three examples above. Your own card's fee and APR decide your cost.
• Payday loan: at the CFPB's common charge of $15 per $100, $100 costs $15.00. The CFPB says that equals an annual percentage rate of almost 400 percent for a two-week loan. A 2014 CFPB report found that four out of five payday loans are rolled over or renewed within 14 days.
• Credit union loan: Payday Alternative Loans from federal credit unions give you at least a month to repay, so we do not price them for 14 days here.
• Cash advance apps: the three lowest-cost routes for each delivery speed are below. Each app's account and bank requirements still apply.

Before you take a cash advance

• Compare the dollar cost, not the name. Put your own amount and payday into the cash advance calculator.
• On a credit card, check your statement first. The CFPB says "your latest credit card statement will also list the current interest rate for cash advances," and it warns that you may incur additional ATM fees as well.
• With an app, check the membership, the instant fee and whether it supports your bank: see apps that work with Chime, apps that work with Cash App and which apps publish no direct deposit requirement.
• If you use Cash App, Cash App Borrow is a separate loan inside the app with its own fee.
• Before a payday loan, check your state's rules and compare credit union PALs.

What we could not verify

• Your card's current cash advance APR. All the card APRs here vary with the Prime Rate. Chase's pricing page is dated December 16, 2025, and Bank of America's example agreement uses the Prime Rate as of June 30, 2026. We did not confirm later rate changes; your statement shows your current rate.
• Interest on the fee and daily compounding. Our card examples charge interest on the amount taken only, at the APR divided by 365 for each day. Capital One's agreement treats its cash advance fee as a cash advance, and issuers calculate balances in different ways, so your statement can show slightly more interest.
• Bank of America's pricing. It is an example agreement, and it says actual pricing will vary from one cardholder to another. It lists no dollar minimum for an ATM cash advance fee, so our example uses none. It gives an APR range for bank cash advances, so our example uses the highest rate in that range.
• Capital One's current cash advance APR. Its consumer card agreement shows offers available as of June 30, 2025, so we give its margin over the Prime Rate and do not price a Capital One example.
• ATM fees. The ATM's own fee depends on the machine and is not included in any example.
• Citi and Discover. We could not read their current cash advance terms on an official page, so they are not included.
• The advisory opinion's exact publication day. The CFPB file is dated December 2025; the opinion itself takes effect on its Federal Register publication date, which the file leaves blank.

Sources

The facts on this page come from the CFPB's consumer answers, its December 2025 earned wage access advisory opinion and Regulation Z, the FTC, and four card issuers' own pricing terms. Card terms change, so confirm your fee and rate before you take cash.