Installment cards with cash withdrawal as a financial instrument

Which installment cards allow cash withdrawals

All installment cards with cash withdrawal allow this operation if you have your own funds in your card account. Withdrawing cash using credit funds is only possible with the Halva card, and the installment is provided for 2 months, in the amount of 15,000 RUB. Withdrawals are not provided for other cards, since the main principle of this banking product is tracking cashless payments.

In fairness, a number of credit cards (not installment cards) with an enabled "installment" option allow cash withdrawals, but this incurs an exorbitant commission. As a rule, such a commission ranges from 39% to 69%, which is extremely unprofitable, and a fixed amount plus a percentage commission will apply to each withdrawal.

Among classic banking products, an installment card with commission-free cash withdrawal is available under the following programs:

• Sovest card. Cash withdrawals are allowed if the borrower uses their own funds as a deposit, and if there is a deposit account.
• Halva card. If you use your own funds, there are no restrictions on cash withdrawals. For credit funds, a transfer to a QIWI wallet is available, where the installment plan can be used for 2 months. At the same time, a standard cash withdrawal commission of 2.9% plus 290 RUB from the available credit limit applies.
• The Vmesto Deneg card from Alfa-Bank (currently archived) and the Svoboda installment card from Home Credit Bank do not provide conditions for cash withdrawals. This is because credit institutions do not consider cash withdrawals to be part of an installment plan. This makes sense, as no-refusal installment cards do not provide installment conditions as such.

Some banks allow transfers from installment credit cards to withdraw cash, but such operations are easily detected and will be unprofitable for the holder of the financial product. The financial services selection service recommends that installment cardholders carefully study the tariff plan of the chosen issuing bank if they plan to withdraw cash. Let's be upfront: not all banking products will be profitable for cash withdrawals.

How much cash can be withdrawn from installment cards

Each issuing bank has its own limits on cash withdrawals. A bank sets limits on a daily and monthly basis. This rule applies to both credit and personal funds. The strictest limits are imposed on installment cards using borrowed funds. This category features high withdrawal fees for both the service itself and each transaction.

All issuing banks view the mechanics of installment plans exclusively through cashless payments. The bank sees what transactions the cardholder makes and can promptly make changes to the lending terms. Thus, if a borrower frequently uses the card for store purchases and repays the debt on time, the bank has the right to increase the credit line limit. This is primarily because the initial credit line size can be small.

Which ATMs accept installment cards with cash withdrawal

However, if this option is provided by the issuing bank's tariff plan, the credit institution has no right to restrict the borrower from performing the operation. The main condition is to strictly adhere to the terms of the liability agreement and the tariff plan. Thus, the credit institution allows cash withdrawals in the following ways:

• ATMs. As a rule, ATMs of your own bank do not charge a commission fee for cash withdrawals, only the interest rate for the service itself. Third-party credit institutions charge a conditional interest rate for the service.
• Electronic wallet. This option is available for Halva and Sovest. In this case, you transfer funds to an electronic wallet, after which, according to your QIWI Wallet tariff plan, cash withdrawals are available. The Sovest card provides similar 2-year [sic - 2-month] installment conditions for this option. Cashing out takes place according to the tariff plan terms of your QIWI wallet identification account.
• Credit institution cash desk. This option is available only for Halva (at Sovcombank) and partially for the Svoboda card (Home Credit Bank). The cost of the service is according to the tariff plan.

The user agreement always specifies the commission amount provided for this operation. For example, for the Halva card, the interest rate is 2.9% plus an additional 290 RUB per transaction.

Why a bank refuses to issue cash using an installment card

Such a situation also occurs, but it depends on many factors that a potential borrower may not always know. Let's look at such situations in detail.

1. There are personal funds on the card, but a debt has formed. The bank blocks the account, where funds are first used to repay the debt, after which the remaining amount becomes available for withdrawal.
2. Absence of the required amount because other services were not paid for. Thus, if you connected paid services and options to your card but did not pay for them, the bank independently debits funds to cover the cost of these services, after which the remaining amount for cashing out becomes available.
3. Limit exceeded. Some issuing banks set cash withdrawal limits. For example, with the Halva card, you cannot withdraw more than 15,000 RUB in cash during a single reporting period. If you use the cash withdrawal option once in the reporting period, you will not be able to use the service again.

Now for the most important part: repaying the debt from cash withdrawals. For example, with the Halva and Sovest cards, you can take out an installment plan for cash withdrawals for 2 months. The main condition is to stick to the repayment schedule in equal installments. If you are approved for a 10,000 RUB withdrawal limit and you made this transaction on October 14, then by November 14 you must return 5,000 RUB to the card, and no later than December 14 – the remaining amount of 5,000 RUB.

Now the question is, is it worth risking cash withdrawals? There is no straightforward answer. If you withdraw money, but there is an installment plan for say 2 months, and you are confident in your financial ability to pay off the debt, then the risk is reduced to zero. If you withdraw 20,000 RUB and the bank charges you a 50% commission, you will have to return about 30,000 RUB anyway to cover all existing maintenance costs for the account on the installment card for cash withdrawals at your issuing bank. Important conclusion! If you need cash, use the installment card wisely for these transactions, otherwise you will find yourself in an awkward situation where you will have to overpay almost double for withdrawing cash. Non-cash payment for installment cards is an important aspect of applying this new banking product in practice in Russia, which first appeared in 2016.