What Is a Cash Advance?

A cash advance is when you get cash using credit, usually from a credit card (like withdrawing from an ATM).

It works like a short-term loan, but it can be expensive because interest starts right away and there is no grace period.

KOHO

If you need help bridging a short term gap, KOHO’s Cash Advance is built exactly for that.

With KOHO Cover, you can:

• Get up to $250 as an instant cash advance (amount depends on eligibility)

• Pay no interest on the advance

• Avoid a credit check

• Repay automatically once you add money or get paid

You subscribe to the Cover Bundle for a low monthly fee, and in return you get the advance feature plus extras like a credit report, financial coaching, and priority support.

How a Credit Card Cash Advance Works

A credit card cash advance usually happens when you:

• Withdraw cash at an ATM, or

• Get cash from a financial institution using your credit card

You are basically borrowing cash against your credit card limit.

Why Cash Advances Can Get Expensive Fast

Two big reasons:

• Interest starts immediately, and there is no interest-free grace period

• The cash advance interest rate is often higher than the rate on regular purchases

That is why cash advances are usually treated as a last resort.

What To Do If You Already Took a Cash Advance

Keep it simple:

• Pay it back as soon as you can, since interest starts right away

• Check your statement so you understand the total cost (interest plus any fees)