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प्रश्न
Explain the term bank overdraft.
Write a short note on overdraft facility.
संक्षेप में उत्तर
उत्तर
- Overdraft is an arrangement under which a current account holder is allowed to withdraw more than the balance to his credit, up to the specified limit.
- An overdraft is allowed for a short period, and interest is charged on it.
- Commercial banks provide overdraft facilities on the security of some assets or on the personal security of the account holder.
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Commercial Banks: Functions
क्या इस प्रश्न या उत्तर में कोई त्रुटि है?
संबंधित प्रश्न
What are Commercial banks?
______ is a revolving credit arrangement.
Distinguish between:
cash credit and loan.
Differentiate between Savings Deposit and Current Deposit.
Write short notes on the primary functions of commercial banks.
Demand deposits include ______ and _______.
Identify the correct sequence of alternatives given in Column II by matching them with respective terms in Column I.
| Column I | Column II | ||
| A. | Function of Commercial bank | (i) | Initial deposits × `1/"LRR"` |
| B. | Money multiplier | (ii) | The difference between market value of the security and the amount of loan. |
| C. | Total money creation | (iii) | Acceptance of deposits |
| D. | Margin requirement | (iv) | `1/"LRR"` |
Mention two necessary conditions for a financial institution to become a commercial bank.
Explain three ways by which commercial banks advance loans to the public.
Give two differences between recurring deposits and fixed deposits.
