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Question
Explain the following term/concept:
Overdraft
Solution
One of the main functions of commercial banks is to provide overdraft facilities. Current account holders are often granted an overdraft facility. Commercial banks offer this service to their customers, allowing them to withdraw funds that exceed their balance. The bank defines the maximum overdraft amount. Interest is imposed on the amount overdrawn.
RELATED QUESTIONS
Select the correct answer from the options given below and rewrite the statement.
Borrowing/Accepting and lending money are considered as _______ functions of bank.
Justify the following statement:
The primary function of commercial banks include-Accepting deposits and leading funds?
State the utility Function of banks
State the Agency functions of Banks.
