Cash credit and overdraft facility
|Bases||Cash credit||Overdraft facility|
|Definition||A loan taken in the form of cash by anyone from the bank against some securities is called cash credit.||Commercial banks allow their customers to withdraw an amount from the bank in excess of their balance.|
|Drawers||Anyone can take a cash loan from banks against some securities.||Only current account holders can avail this facility.|
|Interest rate charged||They charge higher rates of interest against a cash loan.||They charge minimal rates of interest against an overdraft.|
Concept: Commercial Banks
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