Cash credit and current account

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Querist : Anonymous

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Querist : Anonymous (Querist)
03 August 2013 Can a firm open a cash credit account with one bank and the same firm open a current account with different bank.Is it legally allowed?
If so how will each of the banks know the financial position of the firm?

Will such situation not lead to manipulation of bills/payment received from clients

03 August 2013 usually bank provides for only those who have current a/c for availing cash credit.

In my view no bank will give without cash credit facility without having sufficient current a/c balance and guarantee.

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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)

03 August 2013 Yes. for opening normal current account with any bank no restrictions, that is the operation convenience of the business. how ever the bank which you are having credit facility also required to maintain one current a/c


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