How do credit card cash advance fees and interest work?
Last updated: 2026-07-11 · Educational content; not legal advice.
Short answer
A cash advance carries a processing fee capped by the BSP at ₱200 per transaction, plus a finance charge that generally accrues from the date you take the cash — unlike purchases, there is usually no interest-free grace period on a cash advance. The finance charge is still bound by the BSP ceiling of 3% per month on the unpaid balance (BSP Circular 1165, 2023), and all these charges must have been disclosed to you under RA 10870 §11. Because interest starts immediately and stacks on top of the fee, a cash advance is one of the more expensive ways to use a card.
Primary sources
Frequently asked
How much is the cash-advance fee?
The BSP caps the cash-advance processing fee at ₱200 per transaction (BSP Circular 1165, 2023). A fee higher than that ceiling is contestable.
Does a cash advance have a grace period?
Usually not. The finance charge on a cash advance generally accrues from the date the cash is taken, so interest starts immediately — unlike a purchase paid in full by the due date. It remains capped at 3% per month on the unpaid balance.
Were the charges disclosed to me?
RA 10870 §11 requires the issuer to disclose the cash-advance fee and finance charge before they apply. Request that written disclosure; an undisclosed or over-cap charge can be disputed and escalated to the BSP.
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