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What Is A Cash Advance
What is a Cash Advance?
Power of the credit card Credit Cards have become a regular part of the modern man’s life. The cards are being used for a variety of uses and emergencies. The number of credit card users and companies has been on the rise in Canada. The credit card can be used in any shop in the network of shops nationwide and sometimes internationally too. The payment must be made by the customer within the time period or he has to pay the interest for the amount. Another feature of the credit card is the Cash Advance option.
Credit card holder can withdraw cash from an Automated teller machine or popularly called ATM. He can also withdraw cash from a teller in any branch of the bank. The card holder can use the cash for any emergency purposes or when he is unable to use the card to make any purchases. Cash Advance option is offered by almost all Credit card companies in Canada.
Strings attached with Cash Advance Even though Cash Advance seems to be an attractive option when in need of cash, it comes with lot of strings attached. The cash that has been withdrawn is liable for interest from the day it was withdrawn. The interest charged on the cash is higher than the interest charged on the goods purchased through cash.
The ATM from which money is withdrawn must be in the network of the branch and the secret personal identification number must be entered. If the withdrawal is from the branch of the bank then the PIN is not needed. A fee is incurred by the card holder if he uses this option however it may be waived in some cases. Cash Advance option must be strictly used in emergency situations where there is an immediate requirement for liquid cash. The Cash Advance option must be preferred only in emergencies and using it in normal situations is not advisable to the card holder.
Government Regulation found wanting Even though there have been constant reports of credit card companies charging excess fees for Cash Advances, the government has not initiated any concrete steps to regulate it. There has been similar regulation in the United States and there have been calls for such regulations in the provinces as well. But there have not been any steps taken to regulate it by any provincial government. The charges for Cash Advance have been high and laws are formulated regarding other aspects of credit card industry like interest-free period, collection of debt.
Laws regarding Cash Advance however have not been dealt with. Fixing of a minimum fee to be charged for Cash Advance is being mooted as a solution. Withdrawing cash using this option may be exercised as a last resort in times of need. Repayment of the cash drawn must be done in a short time to avoid the interest incurred to shoot up very much. Cash Advance is available to all credit card holders but judging the situation correctly whether a cash advance is necessary is the solution for the card holders. What is a Cash Advance?
Power of the credit card Credit Cards have become a regular part of the modern man’s life. The cards are being used for a variety of uses and emergencies. The number of credit card users and companies has been on the rise in Canada. The credit card can be used in any shop in the network of shops nationwide and sometimes internationally too. The payment must be made by the customer within the time period or he has to pay the interest for the amount. Another feature of the credit card is the Cash Advance option.
Credit card holder can withdraw cash from an Automated teller machine or popularly called ATM. He can also withdraw cash from a teller in any branch of the bank. The card holder can use the cash for any emergency purposes or when he is unable to use the card to make any purchases. Cash Advance option is offered by almost all Credit card companies in Canada.
Strings attached with Cash Advance Even though Cash Advance seems to be an attractive option when in need of cash, it comes with lot of strings attached. The cash that has been withdrawn is liable for interest from the day it was withdrawn. The interest charged on the cash is higher than the interest charged on the goods purchased through cash.
The ATM from which money is withdrawn must be in the network of the branch and the secret personal identification number must be entered. If the withdrawal is from the branch of the bank then the PIN is not needed. A fee is incurred by the card holder if he uses this option however it may be waived in some cases. Cash Advance option must be strictly used in emergency situations where there is an immediate requirement for liquid cash. The Cash Advance option must be preferred only in emergencies and using it in normal situations is not advisable to the card holder.
Government Regulation found wanting Even though there have been constant reports of credit card companies charging excess fees for Cash Advances, the government has not initiated any concrete steps to regulate it. There has been similar regulation in the United States and there have been calls for such regulations in the provinces as well. But there have not been any steps taken to regulate it by any provincial government. The charges for Cash Advance have been high and laws are formulated regarding other aspects of credit card industry like interest-free period, collection of debt.
Laws regarding Cash Advance however have not been dealt with. Fixing of a minimum fee to be charged for Cash Advance is being mooted as a solution. Withdrawing cash using this option may be exercised as a last resort in times of need. Repayment of the cash drawn must be done in a short time to avoid the interest incurred to shoot up very much. Cash Advance is available to all credit card holders but judging the situation correctly whether a cash advance is necessary is the solution for the card holders. What is a Cash Advance?
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