Question

Observe the given image and identify the correct explanation for the given image.

पर्याय

• An overdraft is a kind of a temporary financial accommodation extended by a bank to its regular customer.

• Is a document or certificate issued by a company under its seal as an acknowledgement of its debt.

• This implies procuring cash from a bank in exchange for credit instruments.

• It is a formal and revolving credit agreement under which the borrower is allowed to borrow up to the specified limit.

Answer 1

It is a formal and revolving credit agreement under which the borrower is allowed to borrow up to the specified limit.

Explanation:

Cash credit is a formal, revolving bank facility allowing the borrower to draw funds up to a sanctioned limit as required; interest is charged on the amount actually withdrawn, and security is usually required.