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How to transfer money from a credit card to a debit card

Written by Tom Martin, Content editor

Edited by Florence Codjoe, Content Editor, 19 August 2020

If you want to clear an overdraft or borrow a small sum of cash, you can use a money transfer credit card to move credit into your current account.

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Can I transfer money from a credit card?

If you need to access a small sum of money there are a number of ways you can do this. One option is to use a money transfer credit card. This allows you to move a sum of money from your credit card to your bank account. You can then spend the money in your bank account using a debit card, or you could use the sum in your bank account to clear another debt, like an overdraft.

If you want to withdraw money from your credit card to put into your bank account, this is a relatively low cost and straightforward option compared to setting up a personal loan or borrowing against the value of your house. However, it does come with some costs.

How can I use my credit card to raise some cash?

You can use your credit card to raise a sum of money this way: you have a set amount of money which you can borrow on your credit card. That is called your available credit. If you need some money you can transfer some of your available credit to your bank account from your credit card.

You can withdraw money from your credit card and move it to your bank account using your credit allowance It is best to use a money transfer credit card to do this rather than an ordinary credit card, because the charges will be lower.

How do money transfer cards work?

Money transfer cards are similar to balance transfer credit cards, which allow you to pay off debts from other credit cards at 0% interest. A money transfer credit card allows you to transfer money to a bank account, whereas a balance transfer card doesn't.

You can ask your credit card provider to move a sum of money from your credit card available credit into your nominated bank account. Remember you will still have to repay the money back to your credit card at a later date.

How can I transfer money from my credit card to my bank account without paying interest?

Money transfer cards give you a length of time to repay the money at 0 per cent interest in exchange for paying a balance transfer or money transfer fee.

The longer the period of interest free credit, the higher the transfer fee. So if you want to borrow money from your credit card to pay into your bank account for 12 months, then typically the money transfer fee might be 3 per cent.

If you wanted to have 0 per cent interest rate on the money you have transferred for 24 months, then the fee would be higher, probably around 4 per cent.

Where can I find out more information about money transfer credit cards? We have a guide to help you understand money transfer credit cards and to help you compare the different cards, so you can find the best card for you.

Is it better to get a loan or to transfer money from my credit card? The decision you make on how you borrow money will be based on your personal circumstances, and how much debt you have elsewhere.

However, it can often work out cheaper to transfer money from your credit card in order to raise cash, than to repay a debt at its current interest rate. This is especially true for overdrafts, which tend to have quite high interest rates.

Similarly, it can be cheaper option than taking out a loan to buy something you wouldn't normally be able to buy with a credit card, like a car for example.

Personal loans are usually for a set sum of money, often a minimum of £1,000, and are repaid at a fixed interest rate over a set period of time. They are less flexible than withdrawing a small amount of cash from your credit card and moving it into your bank account.

However, if you need a larger loan, say £10,000, for a project like home improvement, then you might be better off with a personal loan.

If you're looking to borrow a large amount at a lower interest rate, you might consider a secured loan. This is a loan that is offset again the value of your house.

What other options are there to transfer money from a credit card to a bank account?

When it comes to transferring money from a credit card to a bank account, there are alternative options.

If you don't have a money transfer credit card, you might still be able to use your current credit card to put cash in your bank account. Using a credit card to withdraw cash, or buy items considered as cash items, is called a cash advance.

However, cash advances are best avoided, as they are one of the most expensive ways to borrow money. Card providers charge daily interest from the moment you make a cash advance until it is fully paid back. They also charge fees every time you take out cash with your credit card. For example, if you were to use a credit card to withdraw cash from a cash machine, you would usually be charged a fee of around 2 per cent, even if the cash machine you were using said it was 'free'.

Also the 'cash advance' APR (typically between 20-30 per cent) applies from the moment you withdraw the cash and is charged daily until you pay back the sum of money you've withdrawn.

Are there any other times when I will be charged high fees for a money transfers?

Interest charges will apply if you use your credit card to pay for things that could later be used as cash. For example, buying foreign currency from a bureau de change, or gambling tokens at a casino. If you do want to transfer money from your credit card to your debit card, a money transfer credit card will help you avoid paying excess interest and penalty fees.

How to choose a money transfer credit card

If your current card doesn't offer a money transfer facility, you can compare and find money transfer cards with Uswitch.

It's worth comparing cards to find the best money transfer credit card for your needs. This will depend on how much money you want to transfer into your bank account, how long you need to borrow the money from your credit card, and how you plan to pay the money back.

If you want the 'best' deal, you'll likely want to aim to get the card with the longest 0 per cent interest period and the lowest money transfer fee. However, the transfer fees tend to be lower on cards with shorter 0 per cent period. So if you think you can repay your debt quicker, it could work out cheaper to choose a money transfer card with a shorter 0 per cent period and lower fee.

Also it's important to have a plan for repaying the money transfer amount from your credit card after the 0 per cent interest rate period ends.

What is the best way to use a money transfer credit card?

When you have applied for and received your money transfer card you can transfer credit into your bank account.

Once the money is your bank account you can spend it via debit card, or withdraw it as cash from a free ATM at no extra charge.

After you've made the transfer you will owe the amount you borrowed plus the money transfer fee on the credit card. For example, if you transferred £5,000 with a 4 per cent fee, you will owe £5,200 and will need to meet the minimum monthly repayment until this debt is cleared.

What is the best way to repay the money I have transferred from my credit card?

You can repay more than the minimum monthly repayment each month if you want to clear the balance more quickly.

It's worth aiming to pay off the total debt within the 0 per cent interest period, as money transfer credit cards usually revert to relatively high interest rates after the introductory 0 per cent period ends.

For example, you might be paying an interest rate of 23 per cent on the outstanding credit balance on your credit card once the 0 per cent period has ended.

What happens when the interest free period on my money transfer credit card ends?

When the 0 per cent term ends, it's best to pay off the amount in full. That is because you will probably be charged a new transfer fee of up to 5 per cent, and the interest rate on the outstanding loan from your credit card could rise to 23 per cent.

What do I need to look out for when transferring money from credit cards?

If you're using the money transfer credit card to help you pay off a loan or mortgage, make sure you won't be incurring any early repayment penalties. Many lenders want you to pay off a specific amount of the debt each month. So if you suddenly had a lump sum of cash allowing you to pay off a larger proportion, which would clear the debt quicker, just make sure you won't be charged a penalty fee.

To avoid paying interest, don't spend on your new money transfer credit card, unless it also offers a 0 per cent interest purchase period, or you're sure can repay your spending in full each month.

What are the alternatives to money transfer credit cards?

The most obvious alternative to a money transfer credit card is an overdraft with a current account.

Many of these are also interest free (up to a point) and don't require a minimum monthly repayment. But whether this a good choice for you depends on how much you want to borrow. The interest free portion of an overdraft is usually not as generous as the credit limits for money transfer credit cards.

Be careful and do your research as some overdraft charges can be extremely expensive.

Compare money transfer cards

Find a credit card that will let you transfer money into your current account.

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