Check What Is the Cash Limit in Credit Card

Check What Is the Cash Limit in Credit Card

Are you searching ‘how to increase credit card limit’ on the internet? Well, the credit limit of a credit card is entirely different from the cash limit. Most people believe that a credit card can only be swiped via a POS machine or used for online transactions. Besides all the common use cases of a credit card, it is also used to withdraw cash via an ATM. Credit card users should know the difference between the cash advance limit and credit limit. They should also know how a credit card can be used to withdraw money via an ATM. Read on to learn more about the cash limit for a credit card.

Understanding the concept of cash limit

Similar to a debit card, a credit card can be used to withdraw cash from an ATM. However, credit cards that allow users to withdraw cash are different from regular credit cards. Not all credit cards offer the facility to withdraw money via an ATM. Credit cards that do so are called cash withdrawal credit cards. Some issuers/banks also call them cash advance credit cards. ‘Cash Advance’ is the term used for withdrawing cash from a credit card. If someone wants to withdraw cash via their credit card, ask for the cash advance facility from the issuer.

Dissimilarities between cash advance and credit limit

Before knowing how to check the cash limit of a credit card, users should know the difference between the credit and cash limit. A credit card is used for making purchases, paying bills/debts, and many other things. For doing so, the credit limit is utilised. The credit limit is the pre-approved amount that can be used within a billing cycle. Once the credit limit is exhausted, no more purchases can be made using the credit card. Usually, banks check for the credit score, employment status, and credit history to fix the credit limit for each user.

Contrary to the credit limit, the cash limit can only be used to withdraw cash using a credit card. It is also referred to as the cash advance limit by the banks/issuers. Please note that a cash limit is the second line of credit offered only by selected credit cards. Usually, the cash limit for a credit card is lower than the credit limit. One can withdraw the amount mentioned in the cash limit via an ATM. Before trying to withdraw cash via a credit card, consult with the bank to learn about the cash advance facility.

Mechanism of the cash advance system

Withdrawing cash via a credit card isn’t free. The withdrawn amount is deducted from the cash limit, similar to the credit limit. The withdrawn amount has to be returned at the end of the billing cycle with interest charges. Apart from interest charges, other fees are applied to cash withdrawals via a credit card. Usually, banks/issuers apply a convenience fee and a teller fee for making cash withdrawals via credit cards. Responsible credit card users should know the costs associated with making cash withdrawals. Before getting credit card, consult the issuer about the involved costs of making cash withdrawals. Some typical expenses related to the cash advance facility of a credit card are as follows:

  • Usually, credit card issuers offer a grace period to repay the cash limit used during the billing cycle. When someone fails to repay the cash limit used within the grace period, interest charges are applied. The cash amount withdrawn during a billing cycle is to be repaid with interest charges.
  • For processing cash withdrawals via an ATM, issuers can charge a convenience fee to credit card users. The convenience fee can be a portion of the amount withdrawn via a credit card. Some issuers/banks have a fixed charge for the convenience fee.
  • The credit card issuer can apply a teller fee or a premium fee for the cash advance facility.

The best option is to consult with the credit card issuer to know all the costs involved with the cash advance facility. Then, if the facility seems feasible, apply for a cash withdrawal credit card. Also, one may have to apply separately for a cash withdrawal credit card in India.

Checking the cash advance limit of a credit card

One can quickly check the cash advance credit limit online for their credit card. Via the bank’s mobile application or official website, the cash advance limit can be checked. Customer support members of the credit card issuers can also tell a customer the cash limit. After making a cash withdrawal via a credit card, the issuer might send a message reminding you about the remaining cash limit. The process for checking the cash limit online can change from one issuer to another. For any queries regarding the cash advance limit, contact the issuer/bank right away. Get credit cards with a cash advance facility!