Cash Advance on a Debit Card: Are They A Good Idea?

Cash Advance on a Debit Card: Are They A Good Idea?

You just found out you have a sudden expense that you can only pay in cash. You don’t have the cash on you to cover it. What can you do? You might be able to...

You just found out you have a sudden expense that you can only pay in cash. You don’t have the cash on you to cover it. What can you do? You might be able to get a cash advance on your debit card.

Find out how debit card advances work and when to use one.

What is a Cash Advance?

A traditional cash advance works as a small loan that comes from your credit card company. You borrow the money against your credit limit.

A bank or ATM processes the advance and gives you cash. Some lenders let you apply for a cash advance online.

The amount you borrow gets added to your credit card balance. Your credit card company will likely charge a fee for the services, as well as a special cash advance APR.

Unlike your normal credit card balance, this high interest rate doesn’t have a grace period. It starts accruing immediately.

These added costs can make a credit card cash advance an expensive way to get money quickly.

Can You Get A Cash Advance on a Debit Card?

You can’t get a traditional cash advance loan using your debit card account. However, debit cards have their own type of cash advance that’s different from credit card advances.

A debit card advance isn’t a loan. Much like using your debit card at a store or ATM—you’ll need to have the money in your checking account.

This means you can’t get an advance for more than you already have, which could be a problem if lack of funds is the root problem and not simply a lack of cash on hand.

You’ll also need to visit a bank or credit union branch in person to ask for the advance.

You can go to almost any local bank or credit union—they don’t have to be your bank. However, expect to pay a fee for the service.

How to Get a Debit Card Cash Advance

Getting a debit card advance is simple.

Follow these steps to get a cash advance from your debit card:

  1. Find a bank or credit union that offers cash advances. You will need to visit during bank hours to get your advance.
  2. Pay the cash advance fee charged by the bank.
  3. Receive your funds immediately.

How Are Debit Card Advances Different from ATMs?

While ATMs are great for withdrawing quick cash, your account will have a daily ATM limit.

You can’t withdraw more than your daily limit—even if you visit a different ATM.

If you need cash for a large purchase or have already withdrawn a lot of money, you’d be out of luck.

A debit card advance is a lot like withdrawing from an ATM. The difference is you’ll need to physically visit a bank branch for the transaction.

Is Getting a Cash Advance on My Debit Card a Good Idea?

Traditional credit card advances can often lead to debt spirals. Interest charges and fees might leave you with even less cash flow than before you got the advance.

Debit card advances, on the other hand, don’t have the same drawbacks. There’s no interest and the fees are usually minimal.

That doesn’t mean you should go out and get one. Like everything, debit card cash advances have their pros and cons.

Pros of a Debit Cash Advance

  • Avoid interest: Debit card advances don’t charge interest on the money you withdraw, because you’re not borrowing any funds.
  • Available at different banks: A lot of different banks and credit unions offer debit advances. You won’t have to find a branch of your bank to use the service. This can be helpful if you’re traveling.
  • Higher limits than ATMs: ATM cash withdrawal limits are usually a few hundred dollars per day. Cash advance limits tend to be much higher. The amount of cash you can get could be in the thousands.

Cons of a Cash Advance on Your Debit Card

  • Fees: You’ll have to pay a fee to get a debit advance.
  • Balance requirement: You won’t be able to withdraw more than the total amount of money in your account. This makes debit advance useless if you’re looking for a loan.
  • Drains account: Like using an ATM, the money from a debit card advance comes straight from your checking account. You could accidentally overdraw your account and have to face overdraft fees.
  • In-person transaction: Getting a debit advance means making a trip to a local financial institution and physically meeting with a teller. You can’t get them online like you can with a cash advance app.

Debit Card Cash Advance Alternatives

If you’re in a pinch for cash, debit card advances aren’t your only option. You may be able to get the cash you need by:

  • Writing a check: If you have the funds to cover your expense in your account, you might be able to write a check instead of using cash. Don’t carry checks? Some banks let you write e-checks that work the same as a regular check.
  • Getting a personal loan: Debit advances won’t help if you need more cash than you have in your account. In that case, it could make sense to get a short-term loan instead. Loans give you access to quick cash. You can usually apply online and may get your money in minutes. Some lenders, like Possible Finance, offer loans to people with bad credit or no credit. They’ll even help you build your credit score with on-time payments.
  • Opening a credit card: Many credit cards have introductory interest rates for new customers. A low-interest credit card lets you cover your expenses and gives you time to pay off your balance for minimal cost.
  • Applying for a line of credit: Credit cards and loans aren’t the only types of credit. A line of credit is a lot like a credit card. However, they usually have better terms. You will likely need excellent credit for approval. Homeowners can even apply for a home equity line of credit and borrow against the value of their home.

Should I Get a Cash Advance on My Debit Card?

Whether or not you should get a cash advance on your debit card depends on how much money you need—and how much you have.

A debit card advance only works if you already have the money in your bank account. If you have the money and just need to access it, a debit advance could work for you. However, if you need additional funds, a debit advance won’t help.

That’s where options like a short-term installment loan, such as the ones offered through the Possible App, can help you get the cash you need.

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