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Cash credit and current account

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Querist : Anonymous

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Querist : Anonymous (Querist)
03 August 2013 If a firm is availing cash credit from one bank (A) for meeting the working capital after proper guarantee etc, can the same firm also open just a current account only with another bank (B)

Is it legal?

Will it not lead to manipulation of credits/payment received/ due to one babk etc?
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CMA Ramesh Krishnan

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CMA Ramesh Krishnan (Expert)
03 August 2013 It is legal only, unless your credit facility agreement with the bank not permits the same

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