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प्रश्न
State one point of difference between Cash Credit and Overdraft.
State any difference between cash credit and overdraft.
State one difference between cash credit and overdraft.
Distinguish between:
Cash credit and overdraft.
उत्तर १
| Basis of Distinction | Cash Credit | Overdraft |
| Purpose: | Businesses primarily use it to meet working capital requirements. | Individuals and corporations typically use it to bridge short-term cash flow shortfalls. |
| Limit: | A predetermined limit is established depending on the borrower's inventory and receivables. | A limit is established based on the creditworthiness of the account holder and is typically tied to a current account. |
उत्तर २
| Basis of Distinction | Cash Credit | Overdraft | |
| 1. | Eligibility | Persons/organisations not holding current accounts are eligible for cash credit. | Only current account holders are eligible for overdrafts. |
| 2. | Nature | A revolving credit arrangement. | Not a revolving credit arrangement. |
| 3. | Period | A longer period. | For a few days. |
Notes
Students should refer to the answer according to their questions.
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संबंधित प्रश्न
Discuss any five advantages of having a bank account.
Explain briefly the five agency functions of a commercial bank.
Explain two methods adopted by Commercial banks to advance loans to the general public.
State two advantages of a bank account.
______ deposits earn very low rate of interest on it.
Explain the features of savings bank account.
Distinguish between:
cash credit and loan.
Which is the primary function of Commercial Banks?
Which of the following statements are true?
- A bank collects money from those who have surplus funds and lends this money to those who require it.
- Commercial banks do not transfer funds from one place to another.
- The principle objective of commercial banks is to earn profit.
Explain how banks can advance loans through cash credit.
