Learn more about interest of credit card withdrawals

Credit card shopping is becoming more and more popular because they have many attractive utilities and offers. The main purpose of shopping with credit cards is consumer loans, in some cases, customers can still withdraw cash. Should cash withdrawal from credit card?

Function of a credit card

Credit cards are a form of consumer loans, customers borrow money from banks to buy goods, buy meals, travel, etc. Normally, these consumer loans have an interest free period of 45 to 55 days. After the deadline, if the card is not paid in full, the interest will be calculated

In addition, credit cards also have a cash withdrawal function when needed, but this function is not recommended, so the interest and cost are quite high. Unlike Debit cards, Prepaid cards, etc., customers who withdraw money from their accounts are available in their accounts with credit cards. After the deadline of payment, the bank card balance begins to calculate interest. The bank does not encourage cash withdrawal for spending so to limit this feature the bank applies high fees and interest rates to the amount you have withdrawn.

There are many advantages to having a cash loan from a credit card. Therefore, there is a part of customers who open a credit card with the purpose of cash withdrawal because compared to the bank loan, the cash withdrawal is easy, less procedures and no waiting. Some credit cards are cashed up to 100% of the limit. Customers can withdraw cash anywhere at any time is extremely convenient.

Thus, cash withdrawal from credit card helps you quickly get the necessary cash in the fastest time. Therefore, customers can solve problems simply and quickly without waiting.

The main purpose of credit cards is to stimulate shopping, so cash withdrawals are not supported. When withdrawing cash from a credit card, customers incur a high interest rate as soon as they withdraw money. The current interest rate applied by many banks is 4%, so if it is not too urgent you should limit cash withdrawal from credit cards.

When withdrawing cash from a credit card, you need to consider the necessity and the interest rate, cash withdrawal fee to bear to avoid having to pay unnecessary amounts.

How to withdraw money from a credit card

Withdraw money from ATMs

If there is an urgent need for cash, customers can come to an ATM to withdraw cash with the same operations as withdrawing money from an ATM card with the following basic information:

+ Put credit card into card slot
+ Enter the credit card PIN
+ Enter the amount to withdraw
+ Complete the verification operations, get a bill and get a credit card back

In addition to withdrawing money by ATM, there are now many locations equipped with POS machines for customers to withdraw money from credit cards. This is to avoid high interest when withdrawing cash, customers withdrawing money via POS is illegal and can pose a lot of risks for both cardholders and banks.

Interest rate for withdrawing money from credit card

Because it discourages cash withdrawal from credit cards, the relatively high interest rates are often up to 4%. In addition, you also have to pay additional cash advance fee when withdrawing quite large.
Compared to many other banks, VIB has quite cheap and flexible interest rates and cash withdrawal fees depending on the type of card:

Find more details about VIB credit cards here.

Notes on cash withdrawals from credit cards

+ Do not withdraw beyond the allowed limit
Each type of credit card will have its own cash withdrawal limit. This limit is specified for each withdrawal and no more than one withdrawal per day. You should withdraw money within the limit allowed or will be charged more.

+ Withdrawing cash from a credit card will incur high fees and interest
Credit card is a form of consumer lending, so it minimizes cash withdrawals. If you withdraw cash will be charged and very high interest.

+ Other formal options
Credit card will promote many outstanding features if you use the right function. So withdrawing cash from a credit card is the last solution if you need cash.

Above is the information about withdrawing cash from credit card hoping that in urgent times you can choose the right decision for your needs.