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Cash credit and overdraft

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Querist : Anonymous

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Querist : Anonymous (Querist)
02 April 2014 pls tell me common points and difference between cash credit and overdraft.
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C A S.S.Agarwal, M.Com.,LL.B,

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C A S.S.Agarwal, M.Com.,LL.B, (Expert)
02 April 2014 Difference between an Overdraft and Cash Credit
The main points of difference between an overdraft and cash credit are as follows.

(1) Overdraft is a temporary arrangement and is usually for a very short period. The cash credit on the other hand is a borrowing on a comparatively long term and on regular basis.

(2) Overdraft facilities are allowed in current account only. Cash credit needs opening a separate cash credit account.

(3) The rate of interest on overdraft is relatively lower but on cash credit it is higher.
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C A S.S.Agarwal, M.Com.,LL.B,

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C A S.S.Agarwal, M.Com.,LL.B, (Expert)
02 April 2014 Difference between an Overdraft and Cash Credit
The main points of difference between an overdraft and cash credit are as follows.

(1) Overdraft is a temporary arrangement and is usually for a very short period. The cash credit on the other hand is a borrowing on a comparatively long term and on regular basis.

(2) Overdraft facilities are allowed in current account only. Cash credit needs opening a separate cash credit account.

(3) The rate of interest on overdraft is relatively lower but on cash credit it is higher.
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Querist : Anonymous

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Querist : Anonymous (Querist)
08 April 2014 sir

pls some more points.
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