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How To Transfer Money From Credit Card To Bank Account? Research Team | Posted On Wednesday, October 10,2018, 05:59 PM

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How To Transfer Money From Credit Card To Bank Account?



In today’s globalised banking scenario, money is a liquid asset. You don’t need to stand in long queues or contact an agent to move funds to your bank account. From the moment banks have incorporated the online money transfer, the service has been deemed a boon to the masses. During a financial emergency, you can remit money to family thousands of kilometers away, clear loan dues and pay bills from the convenience of home. This service also comes handy in situations where you have no access to financial institutions like banks or ATMs.

Transferring money from a credit card to bank account involves potential costs and charges that must be kept in mind. Listed below are a few reminders on card to bank transfer charges that must be considered:

  • Cash advance interest rates: credit cards can be used to transfer money to bank accounts. But sometimes, your transfers will be charged a higher interest rate. The interest rate charged is either at the cash advance rate or the rate charged is usually higher than the one charged on regular purchases.
  • No interest free days: There are no interest free days. Normally credit card purchases involve a period during which no interest is charged. You can pay back the amount due in this period. But in case of money transfer from credit card to bank account, an interest will be charged from you, right away.
  • Cash advance fee: this kind of transfer is usually considered to be cash advance transfer. For a credit card to bank account transfer, you will be charged 3% of the total amount transferred to the bank account.
  • For international transfers: in case of money transfer from credit card to an account overseas, there could be some restrictions or regulations. But, if the transfer is allowed, an individual has to pay an international transaction fee along with other fees and charges.

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Transfer Money From Credit Card To Bank Account

What is online money transfer?

Online money transfer is wiring money (sending money instantly) from one account to another, using the modern technology of electronic fund transfer (EFT). This is a technology where only data is exchanged between accounts and involves no paper money. Online money transfer enables simple and instantaneous transfers from senders to receivers using contact details like mobile number, email address, and bank account number. A small fee is charged for availing this service. There are several ways to move money to bank accounts, electronically. Though they get the job done, they do have some pros and cons.

Bank to bank transfer:

Bank to bank transfer is a good option in case both the accounts belong to the same person. One can set up a transfer from one bank to the other using contact details. Most of the banks offer this service for free. 

To set up a transfer between accounts you need to link them.

  • Log on to the account from which you want to transfer money. Click on “add an account” or link accounts.
  • Provide the bank details like name, account number, IFSC code, branch name and make a submission.
  • Verify by providing a username and password.

Transfer through e-wallets:

Sometimes banks charge a fee for bank to bank transfer. In that case, you might look for other convenient modes to transfer money. There are several payment apps available. To get started, establish a link between the bank account and the app using checking account and routing numbers. Once the accounts are linked, you can send money to the recipient using the individuals account details. There are certain apps that are virtually instant, while other services typically takes a few days to complete. However, you can speed up transactions by paying a small fee.

Using these services comes with its own share of pros and cons. While availing these services, you need to be careful to whom the funds are being transferred, as payments cannot be reversed. Also these apps don’t provide protection and are prone to scams.

Wire transfers:

The most popular forms of transfer are wire transfer. It enables the transfer of funds across the world from one entity to the other. The services offered are inward and outward remittances. As these transactions are scrutinized by the government, these transfers must follow the regulatory guidelines and requirements. You need to provide details like currency of transfer, international bank account number, the name of the correspondent bank and the SWIFT code to remit money.

SEE ALSO: How To Check Aadhaar Status?

Steps to transfer credit card balance to bank account:

There are a number of ways you can do this. Listed below are some popular methods:

1. Using PayZapp

PayZapp is a KYC approved wallet that offers complete payment solutions and gives you power to pay in just one click. This app allows you to send money to anyone in your contact list or transfer money to your bank account.  You can link the credit card or debit card of any bank to PayZapp, and enjoy the most convenient and secure way of payments.

How to Use PayZapp to transfer money to bank account?

1. Open the app and click on pay /send money.

2. Click on the bank icon and fill the details and amount.

3. Click on continue button to finish the transactions.

Points to note:

  • Update KYC with PayZapp.
  • It implies 2.36% of service charge including GST.
  • The money gets credited instantly.
  • Any amount between Re 1 to Rs 5,000 can be transferred.
  • Total limit is Rs 1 Lakh a month.
  • Transfers can be done only between 3 AM to 9 PM.

Transfer money to bank account using Paytm:

Paytm allows sending credit card money to your bank account.  You can transfer money immediately, using Paytm. However there’s a downside to it. You may be charged 3% of the money that you wish to transfer.

How to use Paytm to transfer money?

Add money on Paytm:

  • Open the app and click on add money option.
  • Enter the amount you wish to transfer
  • Select credit card method and fill card details.

Transfer money through Paytm:

  • Open app and click on passbook options.
  • Click on “transfer to bank” option.
  • Fill the required details
  • Enter the amount to transfer
  • Click on send button and complete the process.

Using a money transfer credit card:

Money transfer credit cards enables, pay into your bank account from credit card. Once the money is in money transfer credit card, it can be withdrawn or used via debit card. Some banks charge 0% interest rates on the transferred cash for an agreed period. So, if you want to make a big purchase or pay off some existing debt, then using these cards makes sense.

How to transfer using money transfer credit card:

  • Log on to net banking and enter customer ID and password.
  • Go to third party fund transfer and select Visa Card Pay.
  • Enter the required details
  • Confirm transactions.

What if my credit card or bank doesn’t allow the transfer?

There are times when you are unable to make transactions or transfer funds from credit cards. Transfer of funds from credit cards to bank accounts, usually carries charges and limitations. In such a scenario consider the following options to transfer funds:

  • Through cheques: some credit card accounts and other loan accounts, provide an option of requesting a cheque based on the available funds in your account. This facility is known as “cheque to self”. To use this option, deposit a cheque at the chosen bank branch to transfer funds to the account.
  • ATM cash advance: this facility can be used to withdraw cash from ATMs using the credit card and deposit the money withdrawn to a bank account. This transaction will attract cash advance fees.
  • International transfer: if you want to send funds to an account located overseas, then you must consider using an international transfer service. However, you must always keep in mind that most of these services only accept payment through electronic funds transfer (EFT), so there might be restrictions or obstructions on using credit cards for international transfers.

See also: Types Of Cheques

Can I transfer money from a credit card to a bank account?   

The option of transferring funds from a credit card to a bank account, depends on the issuer of these cards. While some credit cards give you the option of transferring funds to your bank account, others may have restrictions on these kinds of transactions. Also, the recipient account like bank account or debit card account may be subject to certain rules and regulations, prohibiting these kinds of transactions.

In case the credit card you use allows fund transfer, then the first step is to call the bank and enquire on the fees and the charges involved in these transactions. Also confirm the maximum limit/amount that can be transferred. Once confirmed, you can go with the following options to make fund transfers to bank account using your credit card.

Online fund transfer:

  1. Log on to your credit card account
  2. Select the transfer option
  3. Enter the amount you want to transfer
  4. Enter the required details mentioned in the form
  5. Follow the prompts to complete transactions

Fund transfer over the phone:

  1. Call your credit card company
  2. Request for a fund transfer
  3. Confirm the amount you want to transfer to the bank account
  4. Provide the bank account number and other details required
  5. Follow the prompts to complete the transaction.

If the funds are being transferred to an account with the same bank, the money should be available in the account within a day. If the recipient account belongs to a different institution, then the transfer takes two to three business days.

How much can I transfer from credit card to bank account?

The credit card fund transfer has certain limitations. There is a maximum limit on amount of money that can be sent to a bank account from the credit card. The bank or the credit card issuer will have a maximum credit limit that can be found through your online account or by enquiring from the credit card company. This type of transfer is usually considered to be cash advance transactions, so you may only be able to transfer a portion of your available credit limit.

Points to note:

  • Check repayment penalties
  • Overdraft charges
  • Interest rates charged

Transferring money into bank account from credit cards is an excellent way to avail cash in need. You can avoid certain charges vie-a-vis cash advance. But, make sure not to over utilize this option and clear your dues within the grace period.

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