Which credit-card feature lets a cardholder borrow cash directly from an ATM?

A credit-card feature that lets a cardholder borrow cash directly from an ATM is called a cash advance.

A cash advance allows the cardholder to withdraw money against the card’s available credit, either through an ATM, a bank branch, or sometimes a convenience check. The amount becomes part of the credit-card balance and must be repaid under the card agreement.

Cash advances commonly differ from ordinary purchases in important ways. Issuers may charge a transaction fee, impose a separate interest rate, and begin charging interest immediately rather than offering the purchase grace period available on some cards. The ATM operator may also add its own fee.

A cash advance is therefore borrowing, not a withdrawal from the customer’s deposit account. A debit-card ATM withdrawal uses money already held in a bank account, while a credit-card cash advance increases the amount owed to the card issuer.