How much does a cash advance cost on a credit card in Canada?

A cash advance typically costs a $5 flat fee or 3–5% of the amount (whichever is higher), plus interest at 22.99–25.99% per year that starts accruing immediately with no grace period. A $500 cash advance could cost $20–$25 in fees plus $9+ in interest in the first month alone, making it one of the most expensive ways to borrow money.

What counts as a cash advance on a credit card?

Cash advances include: ATM withdrawals using your credit card, cash-like transactions (lottery tickets, casino chips, wire transfers), cryptocurrency purchases, money orders purchased with a credit card, and some bill payments or peer-to-peer transfers. Balance transfers and convenience cheques from your card issuer may also be treated as cash advance transactions.

What Is a Cash Advance on a Credit Card in Canada?

Q: Does a cash advance affect your credit score?

A cash advance itself does not appear as a separate item on your credit report. However, it increases your credit card balance, which raises your credit utilization ratio — and high utilization (over 30%) can lower your credit score. Frequent cash advances may also signal financial stress to lenders reviewing your account.

How a Cash Advance Works

Feature	Cash Advance	Regular Purchase
Interest rate	22.99–25.99%	19.99–22.99%
Grace period	None — interest starts immediately	Yes — 21 days to pay interest-free
Transaction fee	$5 or 3–5% (whichever is higher)	$0
Rewards/cashback earned	No — most cards exclude cash advances	Yes
Minimum payment allocation	Paid last (after purchases)	Paid first
Impact on credit utilization	Increases balance	Increases balance

Cash Advance Fees by Card Issuer

Card Issuer	Cash Advance Fee	Cash Advance Interest Rate	Daily Interest on $500
TD	$5 or 3.5%	22.99%	$0.31
RBC	$5 or 3.5%	22.99%	$0.31
CIBC	$5 or 3.5%	22.99%	$0.31
BMO	$5 or 3.5%	22.99%	$0.31
Scotiabank	$5 or 4%	22.99%	$0.31
Amex	$5 or 4%	22.99%	$0.31
Capital One	$5 or 3%	25.99%	$0.36
MBNA	$5 or 3%	25.99%	$0.36
Canadian Tire	$5 or 4%	25.99%	$0.36

True Cost of a Cash Advance

Amount	Upfront Fee (3.5%)	30-Day Interest (22.99%)	Total Cost for 1 Month	Effective APR
$200	$7.00	$3.78	$10.78	~64%
$500	$17.50	$9.45	$26.95	~65%
$1,000	$35.00	$18.90	$53.90	~65%
$2,000	$70.00	$37.80	$107.80	~65%
$5,000	$175.00	$94.50	$269.50	~65%

If carried for 3 months, a $1,000 cash advance costs approximately $92 in interest alone + $35 fee = $127 total.

What Counts as a Cash Advance

Transaction Type	Cash Advance?	Why
ATM withdrawal with credit card	Yes	Direct cash withdrawal
Buying lottery tickets	Yes	Cash-like transaction
Casino chips or gambling	Yes	Cash-like transaction
Cryptocurrency purchases	Yes	Treated as cash equivalent
Wire transfer with credit card	Yes	Cash-like transaction
Money order with credit card	Yes	Cash-like transaction
Convenience cheques from issuer	Yes	Treated as cash advance
Peer-to-peer transfers (some)	Sometimes	Depends on how it’s coded
Regular online purchase	No	Standard purchase
Bill payment through credit card	Usually no	May vary by biller
Balance transfer	Special rate	Often separate promo rate

Alternatives to Cash Advances

Alternative	Interest Rate	Fees	Better Because
Personal line of credit	7–12%	None or minimal	Much lower interest rate; grace period
Overdraft on chequing account	19–22%	$5/month	Still cheaper than cash advance
Personal loan	7–15%	$0–$100 origination	Fixed payments, lower rate
Borrow from family/friends	0%	None	Free, but manage expectations
Payday loan	400–600% effective	Very high	Worse — avoid at all costs
Sell items (Kijiji, Marketplace)	0%	None	No debt at all
Gig work (DoorDash, Uber)	0%	None	Earn the cash instead
Emergency savings (HISA)	N/A	None	Best option if available

When a Cash Advance Might Be Justified

Scenario	Better Alternative Available?
True emergency (car tow in remote area, no other option)	Maybe justified as last resort
Urgent medical expense	Try personal line of credit first
Travelling and need local currency urgently	Use a debit card or no-FX-fee credit card instead
Everyday expenses between paycheques	Budgeting issue — use a line of credit or restructure spending
Paying off another debt	Never — you’re creating more expensive debt

Cash advance fees in Canada: typical rates

Fee component	Typical rate
Transaction fee	2–5% of advance amount (minimum $3.50–$10)
Interest rate	21.99–23.99% APR
Grace period	None — interest starts immediately
ATM fee (third-party)	$1.50–$5 additional

Example cost: $500 cash advance, repaid in 30 days

Transaction fee: $10 (2%)
Interest (23.99% × 30/365 × $500): $9.86
Total cost: ~$20 for borrowing $500 for 30 days = effective APR of approximately 48%

For comparison: a personal line of credit at 6–8% APR on the same $500 for 30 days costs under $5.

Frequently asked questions

Does a cash advance affect your credit score in Canada? A cash advance itself is not reported differently from regular purchases on your credit report. However, the resulting higher balance increases your credit utilization ratio, which can lower your score. If the cash advance indicates financial difficulty and leads to late payments, that damages credit significantly. Cash advances are a warning sign for lenders reviewing your credit history.

What is the easiest way to get emergency cash in Canada without a cash advance? Alternatives in order of cost: (1) Personal line of credit (6–8% APR, immediate access); (2) HELOC if homeowner (prime + 0.5–1%); (3) Personal loan (8–15% APR for good credit); (4) Interac e-Transfer from savings; (5) Ask family or friends. Cash advances should be a true last resort given their cost.