Commercial Applications
State any difference between cash credit and overdraft.
OR
Distinguish between Overdraft and Cash Credit.
Banking
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Answer
Distinction between Cash Credit and Overdraft
| S.No. | Basis of Distinction | Cash Credit | Overdraft |
|---|---|---|---|
| 1. | Meaning | Cash credit is a type of loan that allows the borrower to withdraw funds up to a certain limit. | Overdraft allows the borrower to withdraw more funds than they have in their account. |
| 2. | Period | Granted for a longer period. | Granted for a few days only. |
| 3. | Nature | It is a revolving credit arrangement. | It is not a revolving arrangement. |
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