Prepaid credit cards have been available for over ten years but people did not recognize them. These cards came in spotlight when people started falling in debt traps due to credit cards. Lenders offered plastic money to each and everyone person without noticing their financial capability. As a result, people spent money to get luxurious goods and services; they did not use it wisely. Now, people have understood that this plastic money is meant to use for emergency purposes. These cards are saving account cash which individual can use for any purpose with the help of plastic card.

Consumers are not allowed to spend more than the amount deposited into the account. It saves you from liabilities. One good thing of these cards is that lenders do not run credit check while offering the card. It means, bad credit holders can also enjoy the benefits of plastic money if they got cash in saving account. There is no APR charge on these cards because customers use only their money to make transaction. It is not credit at all. Users do not need to worry about later payments or late payment fees; banks deduct the amount on the spot from the account as you make purchase.

People can also withdraw the cash from any ATM machine available in market without paying any interest or charges. This is the best option for card holders who miss their credit cards. According to experts, this card option makes you more responsible because you start spending the money according to the available cash. Prepaid credit cards also offer rewards point and other incentive options. They are easy to use and not risky at all.

Although credit cards are generally used for purchasing goods in shops and online, they can also provide you with the same services as an ATM. If you are short of money and a credit card cannot be used, then you can use your credit card to withdraw money from a cash machine. If you want to know more about credit card cash advance features, then here are some tips to get you started.

What is a cash advance?

A cash advance is simply when you use your credit card to withdraw funds from a cash machine. You are in effect using your credit card to withdraw an advance of cash. This money is part of your credit limit, and will show up on your statement in much the same way as any other purchase. Cash advances also include transferring balances to a debit card or other credit card.

How to get a cash advance

Most credit cards have cash advance features, and you simply need to put your card into the cash machine just as you would your debit card. Enter your PIN and then you can withdraw cash. Some credit cards also offer the opportunity to transfer part of the balance to a debit card, meaning you can use credit and change it to cash.

What are the costs?

Of course, using your credit card for cash advance features can be expensive. Your card issuer will usually charge either a flat fee per transaction or a percentage of the amount withdrawn, which is usually between 1% and 4%. Also, if you use cash machines it is likely that the owner of the ATM will also charge you a fee for using a credit card to withdraw funds, although this does vary. Another disadvantage of cash advances is that there is no grace period for these transactions, meaning that you start paying interest the moment that you withdraw the cash. However, there are a select few issuers who do not charge fees on cash advances, meaning that you can use your credit card to withdraw money without feeling the costs.

When to use cash advances?

Cash advances should be kept to a minimum due to the fact that they can cost you a lot of money, and that you are putting yourself into debt every time you withdraw the cash. However, cash advances are a great tool for emergency situations and can give you another payment option when you are out and about. Using cash advances when you are a little short of money or when credit cards are not accepted can be extremely useful. Also, balance transfers are often charged as cash advances, so remember this when transferring a balance from one card to another.

Not all of your limit

Another thing to remember with cash advances is that you usually cannot use all of your available credit for such purposes. Many credit card companies limit the amount you can withdraw as cash advances to between 50% and 90% of your total credit limit. However, if you use cash advances wisely then this will not be a problem. Although cash advances can be costly, they are an excellent tool for emergency situations and when you are short of money.