You may not know about Discover’s hidden cash advance benefit. A perk not offered by many other cards, it’s certainly helpful for those in a pinch. But the perk could very easily get out of control if you’re not careful.
[READ: Best Discover Credit Cards]
Understanding Discover’s Cash Advance Feature
Discover allows its cardholders to get up to $120 cash without a cash advance fee at more than 70 stores across the country — every 24 hours with no monthly limit. Stores include Aldi, Piggly Wiggly, Safeway, Dollar General and other popular national and regional chains. The process is similar to how you would withdraw cash from your debit card at checkout: You pay for your purchase and request cash.
Normally, a cardholder would need to pay a cash advance fee of $10 or 5% of the amount of each cash advance, whichever is greater. However, this feature allows cardholders to borrow against their Discover credit card in the amount of $120 every day — with no fee. Also, the same purchase annual percentage rate applies, like with any other Discover card purchase. Normally, a cash advance is charged a higher APR.
While this little-known feature can be helpful for consumers who need cash when a credit card won’t do, the feature could be easily abused if you’re not careful. With no limit, cardholders could theoretically borrow $120 a day until they hit their credit limit.
Cash Back vs. Cash Advance
When getting cash from your credit card, it’s important to know the difference between getting cash back rewards and getting cash as a cash advance. Cash back rewards are usually a percentage of your purchases — say, 2% — and are generally redeemed as credits on your monthly balance. A cash advance lets you borrow against your credit card’s line of credit.
A cash advance will appear on your statement like any other charge, but it will begin to accrue interest immediately until you pay it off. You can access cash on your credit card in a number of ways, including at an ATM, a bank, online or with a convenience check. With Discover, however, you can also get a cash advance at checkout at some of your favorite supermarkets.
[Read: Best Cash Back Credit Cards.]
The Fine Print
While Discover says it doesn’t charge you interest immediately on these kinds of cash advances, it’s more than likely charging you immediate interest on all of your other purchases if you have revolving debt on your credit card. And the likelihood that you have revolving debt is high since about half of credit card holders carry a balance month to month on their credit cards.
Cash advances also don’t earn rewards. So it’s best to only consider a cash advance if it’s absolutely necessary.
Final Thoughts
Using this cash advance feature from Discover can be helpful if you need cash and don’t want to pay additional fees. However, consumers shouldn’t abuse this feature because it could exacerbate their debt.
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Skip the Cash Advance Fees With This Discover Card Perk originally appeared on usnews.com
Update 09/24/25: This story was previously published at an earlier date and has been updated with new information.
