How to Transfer Money From Credit Card to Bank Account

Our article teaches how to transfer money from credit card to bank account.

Updated: January 25, 2024
Matt Crabtree

Written By

Matt Crabtree

 

You may consider making a money transfer if you have a credit card and need cash in your bank account. Although there are cheaper options to obtain money, you must know all about money transfers.

You can transfer money from most credit cards. However, there are specific credit cards that are designed for money transfers.

In this article, you'll learn all about money transfer credit cards and how to transfer money from your credit card to a bank account.

What Is a Money Transfer Credit Card?

A money transfer allows you to transfer your balance from your credit card to your current account.

You're essentially borrowing money from a credit card balance. A money transfer credit card is often used to consolidate debt. You can use the money from your credit card once it's in your bank account as you usually would with your debit card.

Transferring money from a credit card can get expensive; fees are involved, and interest rates can increase if you use a regular credit card.

Money transfer cards have different interest rates depending on your credit card provider. On top of interest rates, there are transfer fees. There may also be a minimum amount for money transfers, so you must ensure you can transfer the funds you need.

Usually, credit card providers won't allow you to move your overall credit limit but instead a percentage of it. So, typically, there are two credit limits with money transfer cards. One is the overall credit limit, and the other is the credit limit of transferable funds.

A money transfer is different to a balance transfer. A balance transfer allows you to transfer funds from one credit card to another. With a money transfer, you're moving money to a bank account. Money transfer is also different to cash advances. A cash advance is when you withdraw cash from a credit card via an ATM.

Pros and Cons of Transferring Money From a Credit Card

Before learning how to transfer money from a credit card to a bank account, we must cover the basics first with the pros and cons.

Pros

✔️ Debt consolidation: If you have multiple debts, you can consolidate them onto one card, making only one payment instead of several.

✔️ Promotional interest rate: Some credit card providers offer an introductory interest-free period, so you can repay your debts without worrying about accruing interest. You could save money by paying off all your debts and credit card balances before the introductory period ends. The interest-free period lasts up to 56 days. After this period ends, you will start paying interest on the credit card balance.

✔️ Low fees: A money transfer card will have lower fees than a regular credit card. You will usually get a lower transfer fee if you have a money transfer credit card. If you use your standard credit card for money transfers, check with your bank provider how much the transaction will cost.

✔️ A quick way to access money: Using a mobile banking app, you can transfer money directly from your credit card. The overall process is straightforward.

Cons

❌️ Limitations: Some credit card providers won't allow you to transfer your entire credit limit.

❌️ Money transfer fee: Even though a money transfer card allows you to transfer money at a better rate than other credit cards, you will still have to pay a transfer fee.

❌️ Higher APR rates: The APR rate on your credit card may be higher than the APR of your original debt. So, always check if a money transfer card has increased interest rates to prevent paying more than you originally were on your debt.

❌️ Other options: Cheaper options, like personal loans or debt consolidation plans, may be available.

❌️ Affect credit record: Your money transfers will show on your credit record. It could affect your credit rating if you don't make your monthly repayments on time. If you pay back the balance, you could avoid creating more debt than what you started with.

How to Transfer Money From a Credit Card to a Bank Account

We've created a step-by-step guide on transferring money from your credit to a different bank account.

The most efficient way is through a mobile banking app or online banking platform. Some banking institutions may allow you to make money transfers in a branch if you have both your credit card and current account with them.

Transfer money directly from your credit card in five simple steps:

  1. Log into your online banking: You must access your online or mobile banking platform. You must select your credit card account if you have multiple accounts with the banking provider.
  2. Look out for money transfer options: Once on your preferred banking platform, you must look for the money transfer option. It will be similar to the options provided on your regular bank account. You will need to work out how much money you need to transfer. You must check the money transfer credit limit, as not all banks allow you to transfer the whole amount.
  3. Enter account details: You must submit the bank details of the account you're sending money to. You may also want to check if there are additional fees on top of transfer fees. You should only send money to accounts that you know. Before completing the request, your bank will confirm any fees and terms and conditions.
  4. Bank provider approval: Money transfers aren't always instant. Your bank will need to approve the transaction and run a security check that ensures that you are the one transferring money from the credit card. Security checks may be involved, which could take a short time.
  5. Wait for funds to become available: Once the request is accepted, you will find the funds in your bank account within the next working day. Once it's in your account, you can use it to consolidate debt or any financial situation you may need.

Alternative Options to Money Transfer Credit Cards

There are ways to borrow money that may be more beneficial than transferring funds from your credit card account.

We've compiled a list of all the alternative options that you could try, such as:

  • Personal loans: If you need urgent access to cash, consider taking out a personal loan. Most commonly, personal loans are payday loans and help gain quick access to money before payday. High-interest rates are involved, so look for the best deal. You can try looking into unsecured loans to help relieve your financial troubles, as they're usually accessible.
  • Savings account: You could start looking at savings accounts to put aside extra cash to earn interest and save on any future financial emergency. Try to start saving as much money as possible. A savings account will help separate the money you use daily from the money you want to save.
  • Debt management plan: If you want a money transfer credit card for debt consolidation, there may be other options to help clear your debts. If you create a plan with your incoming and outgoing, you can work out a system to pay your debts off without paying a credit card's interest. Depending on your financial situation, you can do a debt plan using the avalanche or snowball method.

Final Thoughts

Money transfer credit cards are better if you transfer funds to your bank account. They come with lower transfer fees and are designed for money transfers, so typically, they're better for your wallet.

Before you transfer funds, remember to consider costs and affordability. There may be cheaper options available to you; if you have financial troubles, you may want to seek a financial advisor.

Related Guides:

How to Transfer Money From Credit Card to Bank Account: FAQs

Can You Transfer Credit Card Money to a Bank Account?

How Do I Take Money From a Credit Card?

Does It Cost to Transfer Money From a Credit Card?

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