Credit cards are an essential financial asset for people who passes credit card eligibility criteria, providing instant access to funds to them. Transferring money from your credit card to your bank account can be a convenient way to access funds, especially in situations where you need cash but don’t have sufficient funds in your bank account.
However, most credit card companies charge a high fee for this service, which can make it an expensive option. Fortunately, there are some ways how to transfer money from credit card to bank account without burning a hole in your pocket.
Transferring money from your credit card to your bank account is a good practice. There are various methods available to transfer funds from your credit card to your bank account, along with the associated charges, which are as follows:-
Direct Transfer to Bank Account
Credit card to bank account transfers can be made from the phone if the bank allows the direct transfer. The transfer limit varies from bank to bank, so you must check that with your bank to get updated information.
The transfer is almost instant if you transfer funds to an account with the same bank as the credit card. However, the transfer to an account with another bank credit card might take some time to get processed.
Net Banking
Net banking is a suitable way for individuals with passed credit card eligibility to transfer money to their bank account. This can be done by directly accessing your credit card’s online banking. The charges for moving from a credit card to a bank account may vary from bank to bank. Here are the steps to transfer money using net banking:
- Step 1: Open the bank’s website.
- Step 2: Sign in to your account.
- Step 3: Select the option to transfer.
- Step 4: Enter the amount that you intend to transfer.
- Step 5: Enter the details.
- Step 6: Follow the prompts to complete the transaction.
Phone Call
If you require the cash immediately and do not have access to the internet, a credit card to bank account transfer is always a phone call away. The credit card charges to transfer to a bank account through a phone call will be the same as the amount charged via net banking. Here are the steps to transfer money using a phone call:
- Step 1: Call your credit card company.
- Step 2: Request for a fund transfer.
- Step 3: Confirm the amount you want to transfer to the bank account.
- Step 4: Provide the bank account number and other details required.
- Step 5: Follow the prompts to complete the transaction.
Indirect Transfer to Bank Account
If the bank does not allow you to make a direct transfer from your credit card to the bank account, there are some accepted hacks around this. Several apps charge a nominal fee on cash withdrawals but offer cashback deals that significantly reduce the overall fee amount.
There are many options like Paytm, which are digital wallets that permit you to carry out transactions securely. These are attached to your bank account and require a KYC to be completed.
Other Transfer Options
If none of the above options work, you can consider the following options:
Cheques:
Signing a cheque to yourself is another option where the money is taken from your credit card and transferred to your bank account.
Here are the steps to write a cheque to yourself:
- Step 1: Include the name of the payee as ‘self.’
- Step 2: Include other necessary information
- Step 3: Deposit the cheque at your bank branch.
The applicable fees will depend on the cheque collection and deposit charges levied by your bank.
ATM Cash Advance:
An ATM cash advance allows you to withdraw cash from an ATM using your credit card and deposit that amount to your bank account. The fees to withdraw cash payments may vary from bank to bank, but they could be anywhere from 2-3%.
Things to keep in mind
Transferring cash to a bank account might be used to bypass cash withdrawal fees, but it should never be relied upon to generate free credit. Exceeding the annual spending limit on your credit card can result in the bank reporting your activity to the income tax department, and fines may be charged if you miss credit card payments.
Conclusion
If you require quick cash but your bank account is low on funds, transferring money from your credit card to your bank account can be a convenient option. Despite the high fees that credit card companies typically charge for this service, there are alternative ways to do so without incurring exorbitant fees.
These options include direct bank transfers, net banking, phone call transfers, indirect bank transfers, cheque transfers, and ATM cash advances. It’s crucial to be aware of the transfer limits and charges associated with each method.
Also Read: Difference between credit card surcharge & convenience fee?