There may be situations where you need immediate funds in your bank account but only have available credit on your credit card. In such cases, you may be able to transfer money from your credit card to your bank account through a feature commonly known as a cash advance or credit card fund transfer.
However, unlike regular purchases, transferring money from a credit card often comes with additional charges and interest costs. Therefore, it should generally be used only during emergencies.
In this guide, we'll discuss the different methods available, associated charges, and important considerations before transferring money from a credit card.
Can You Transfer Money from a Credit Card to a Bank Account?
Yes, some banks allow direct fund transfers from a credit card to a linked bank account. Others may offer cash advance facilities or alternative methods to access funds.
The availability of this feature depends on:
- Card issuer policies
- Credit card type
- Available credit limit
- Customer eligibility
Popular Ways to Transfer Money from a Credit Card
Transfer Money Through Mobile Banking or Net Banking
Some banks offer direct credit card fund transfer facilities through internet banking or mobile apps.
Steps to Transfer Money Online
Step 1
Log in to your bank's mobile banking app or internet banking portal.
Step 2
Navigate to:
Payments or Fund Transfer
Step 3
Select your credit card account.
Step 4
Choose the destination bank account.
Step 5
Enter the amount to be transferred.
Step 6
Verify the transaction using OTP authentication.
The funds are usually transferred instantly or within a few hours.
Transfer Through Customer Care
Many banks also allow fund transfer requests through customer support.
Steps
Step 1
Call the customer care number of your credit card issuer.
Step 2
Request a credit card fund transfer.
Step 3
Provide:
- Registered mobile number
- Credit card details
- Bank account details
- Transfer amount
Step 4
Complete the verification process.
The transfer will be processed according to the bank's policy.
Transfer Money Through Digital Wallets
Digital wallets can sometimes act as an intermediary for transferring funds.
Popular wallets may include:
- MobiKwik
- Other eligible wallet providers
Steps
Step 1
Open the wallet application.
Step 2
Select:
Add Money
Step 3
Choose:
Credit Card
as the funding source.
Step 4
Enter card details and complete OTP verification.
Step 5
After the amount is credited to the wallet, use the wallet's transfer-to-bank facility if available.
Please note that wallet providers may charge additional fees for such transactions.
ATM Cash Advance Method
If direct transfer options are unavailable, a cash advance is often the easiest alternative.
Steps
Step 1
Visit an ATM that accepts your credit card network.
Step 2
Insert the credit card.
Step 3
Enter your credit card PIN.
Step 4
Withdraw cash using the cash advance facility.
Step 5
Deposit the cash into your bank account.
Although simple, this method is usually the most expensive due to cash advance charges and immediate interest accrual.
Transfer Through Cheque
Some banks offer cheque facilities linked to credit card accounts.
Steps
Step 1
Issue a cheque in your own name.
Step 2
Write "Self" in the payee section if required.
Step 3
Deposit the cheque into your bank account.
Step 4
Wait for the clearing process.
The amount is then debited from your credit card account.
Availability depends on the card issuer's policies.
Charges for Credit Card to Bank Account Transfers
Transferring money from a credit card is usually treated as a cash advance transaction.
Typical charges include:
Cash Advance Fee
Most banks charge:
- 2.5% to 5% of the transaction amount
- Minimum fee of ₹300 to ₹500
Interest Charges
Unlike regular purchases, cash advances generally do not enjoy an interest-free period.
Interest starts accruing immediately from the transaction date.
Typical interest rates:
- 3.4% to 3.75% per month
- Up to 45% annually in some cases
GST and Other Charges
Applicable taxes are charged on fees and interest.
Example of Cash Advance Cost
Suppose you withdraw ₹20,000 through a cash advance.
As a result, the effective cost can become significantly higher than a normal credit card transaction.
Can You Transfer Money from a Credit Card to a Debit Card?
No.
A debit card itself cannot receive funds directly from a credit card.
However, once money is transferred to your linked bank account, you can access those funds through your debit card.
Things to Consider Before Transferring Money
High Cost
Cash advances are among the most expensive forms of borrowing.
No Interest-Free Period
Interest begins from the date of withdrawal.
Impact on Credit Utilization
Large transfers may increase your credit utilization ratio and potentially affect your credit score.
Emergency Use Only
Financial experts generally recommend using credit card fund transfers only in genuine emergencies.
Alternatives to Credit Card Fund Transfer
Before using a cash advance, consider:
- Personal loans
- Overdraft facilities
- Salary advances
- Emergency funds
- Borrowing from savings
These options may be cheaper than credit card cash advances.
Bottom Line
Transferring money from a credit card to a bank account is possible through direct fund transfers, cash advances, digital wallets, customer care requests, or cheque facilities, depending on the card issuer. However, such transactions usually attract high fees and immediate interest charges.
Because of the costs involved, credit card-to-bank transfers should be used only when absolutely necessary. If you choose this option, try to repay the amount as quickly as possible to minimize interest expenses and avoid unnecessary debt accumulation.