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cash credit loan v/s bank overdraft

amulya (always ready to learn) (79 Points)

10 May 2011

what is the difference between cash credit facility and bank overdraft?

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The difference between cash credit and overdraft is that while under cash credit the security is inventory of the company while under overdraft security is generally the fixed assets of the company. Both cash credit and overdraft are operating accounts through which a borrower if he or she desire can withdraw funds as and when needed up to the credit limit given by the banker to him or her.