GENERAL KNOWLEDGE

Detailed explanation-1: -An overdraft facility in a Current Account allows you to withdraw from even though the balance is zero. It is a form of extension of a stipulated limit offered by banks; the said amount of funds is known as overdrawn.

Detailed explanation-2: -Overdraft limit account is a running account in which you can deposit/ withdraw amount anytime up to the specified limit. The bank levies the interest on the overdraft amount used by the borrower at predefined rate. The interest is calculated daily and billed/debited to your on monthly basis.

Detailed explanation-3: -An overdraft lets you borrow money through your current account by taking out more money than you have in the account – in other words you go “overdrawn”. There’s usually a charge for this. You can ask your bank for an overdraft – or they might just give you one – but don’t forget that an overdraft is a type of loan.