Credit Card Cash Withdrawal Charges: Fees, Interest, Limit

You can withdraw cash from a credit card at an ATM, but it is one of the most expensive ways to borrow in India. As of October 2026, most issuers charge a cash advance fee of about 2.5% (with a minimum of roughly ₹300 to ₹500), interest of around 3% to 3.75% a month from the very day you withdraw, and 18% GST on both the fee and the interest. A ₹10,000 withdrawal kept for a month can easily cost close to ₹1,000.

This guide explains each charge, the cash limit, why ATMs show "insufficient credit limit", what it does to your rewards and CIBIL score, and cheaper ways to raise money.

Cash limit vs credit limit

Every card has two limits, both printed on your monthly statement:

• Credit limit: the total amount you can owe on the card.
• Cash limit (cash advance limit): the part of that credit limit you can take out as cash.

The cash limit is inside the credit limit, not in addition to it. If your credit limit is ₹1,00,000 and the cash limit is ₹40,000, a ₹10,000 withdrawal reduces both your available cash limit and your available credit limit by ₹10,000. Issuer documents show cash limits ranging from around 40% to as much as 80% of the credit limit depending on the card, and some banks also set a daily ATM cap. RBI's Credit Card Master Direction requires the cash withdrawal limit to be disclosed in your card's Most Important Terms and Conditions (MITC).

What a cash withdrawal costs: the four charges

1. Cash advance fee

Large issuers such as HDFC Bank, ICICI Bank and SBI Card typically list a cash advance fee of about 2.5% with a minimum of roughly ₹300 to ₹500, but check your own card's current MITC because the figures change. Some premium cards charge less or nothing. Because of the minimum, small withdrawals are hit hardest: on a ₹5,000 withdrawal, a ₹500 minimum is effectively a 10% fee.

2. Interest from day one, with no interest-free period

Purchases get an interest-free period of up to about 50 days if you pay the full bill. Cash advances get none. Bank MITCs state that finance charges on cash run from the date of withdrawal until the date of full payment, at the same monthly rate as revolving credit, typically around 3% to 3.75% a month (about 36% to 45% a year). Paying the full bill on the due date does not undo the interest already accrued. Our guide on how credit card interest works explains the daily-balance method.

3. GST on fees and interest

GST at 18% applies to the cash advance fee and to the finance charges. RBI's directions say unpaid charges, levies and taxes must not be capitalised for charging interest, but the interest itself keeps accruing until you clear the cash balance.

4. ATM charges

In India the cash advance fee is usually the main transaction charge, but some ATMs, particularly overseas, add their own access fee that is shown on screen before you confirm. Withdrawals abroad also attract the issuer's foreign currency markup and often a higher cash fee. Check the schedule of charges before using the card at a foreign ATM.

Worked example: ₹10,000 withdrawn and repaid after 30 days

Assume a card that charges 2.5% (minimum ₹500) as the cash advance fee and 3.6% a month (43.2% a year) as interest. You withdraw ₹10,000 and repay it in full 30 days later. This is illustrative; your card's rates may differ.

You pay about ₹1,009 to use ₹10,000 for one month, roughly 10% of the amount. On a card with a ₹300 minimum fee, the total would be ₹300 + ₹54 + ₹355.07 + ₹63.91 = ₹772.98, still nearly 7.7% for a single month. Every extra month at the same rate adds about ₹419 (interest plus GST).

If you pay only the minimum amount due, the cash balance keeps accruing interest month after month, and the interest-free period on your new purchases is also lost while any balance is carried. Use the credit card interest calculator to change the amount, rate and number of days for your own card.

Why the ATM says "insufficient credit limit" or "limit exceeded"

These messages mean the amount you asked for is more than what is available to you at that moment. Common reasons:

• Cash limit used up: you may have plenty of credit limit left but little cash limit.
• Unbilled spends and unpaid dues: recent purchases reduce available limit even before the statement is generated.
• EMI conversions: the full outstanding principal of an EMI plan is blocked from your limit. See how card EMIs block your credit limit.
• Daily ATM cap set by the issuer, or a cash-withdrawal toggle switched off in your card's app.
• A recently reduced limit. If the bank has cut your limit, our guide on a credit card limit reduced explains why and what to do.

Under RBI's Credit Card Master Direction, the issuer must not let your credit limit be breached without your explicit consent, and it cannot levy over-limit charges unless you have opted in. So "limit exceeded" usually just means the transaction was declined; check your available cash limit in the app and try a smaller amount only if you genuinely need it.

How to withdraw cash from a credit card (if you must)

1. Set a credit card PIN through the bank's app, net banking or an ATM, if you have not already.
2. At the ATM, insert the card and choose the credit card or credit account option if asked.
3. Enter an amount within your available cash limit and confirm.
4. Note the date; interest starts today.
5. Repay the cash amount as soon as possible through the app, net banking or UPI bill payment.

Effect on reward points and your CIBIL score

Rewards: Cash withdrawals generally earn no reward points or cashback. Issuers such as IndusInd Bank state this explicitly, and cash is on the standard exclusion list for most cards. See how reward points work.

Credit utilisation: The withdrawal adds to your outstanding balance, which is what card issuers report to credit bureaus such as CIBIL. On a ₹1,00,000 limit, ₹10,000 of cash plus ₹25,000 of purchases puts utilisation at 35%, above the commonly cited 30% guideline. Read more in our credit utilisation ratio guide. Frequent cash advances can also be read by lenders as a sign of financial stress. The bigger risk is missing the payment: RBI allows issuers to report an account as past due once it is more than three days past the due date.

Cheaper alternatives to a cash advance

• Pay the merchant directly by card or by UPI on a RuPay credit card instead of withdrawing cash. NPCI's rules for credit cards on UPI allow merchant payments only; person-to-person transfers and cash withdrawal are not permitted. More in our guide to UPI on RuPay credit cards.
• Loan on credit card: many banks offer a pre-approved loan within or against your card limit, credited to your bank account and repaid in EMIs. Compare the APR, processing fee, GST and foreclosure terms with the cash advance cost.
• Personal loan or gold loan: for anything beyond a few days, these usually cost far less. Compare them in personal loan vs gold loan vs loan against FD.

How to repay a cash advance and stop the interest

• Pay as soon as possible, even before the statement. Interest is calculated daily, so every day you repay earlier saves money. You do not have to wait for the bill.
• Pay the total outstanding, not just the minimum. Many issuers apply payments to taxes, fees, interest and older balances before the cash principal, and at least some MITCs list cash advance last in the payment order. Clearing the full outstanding is the only sure way to stop the cash interest.
• Check the next statement. Interest for the days between withdrawal and payment may appear on the following statement as residual finance charges. Pay that too.
• If you cannot repay quickly, convert the debt to a cheaper loan rather than revolving it on the card.

Key takeaways

• The cash limit is part of your credit limit, typically a fraction of it, and is shown on every statement.
• Expect a cash advance fee of about 2.5% with a minimum of roughly ₹300 to ₹500, plus 18% GST.
• Interest of about 3% to 3.75% a month starts on the withdrawal date; there is no interest-free period on cash.
• A ₹10,000 withdrawal repaid after 30 days can cost about ₹770 to ₹1,010 in this illustration.
• Cash earns no rewards and raises utilisation; a missed payment hurts your CIBIL score far more.
• A loan on card, personal loan or gold loan is usually cheaper for anything longer than a few days. Always check your card's MITC.