Overdraft Facility

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Overdraft Facility

A short term loan that a bank makes to a business automatically if that business otherwise would face an overdraft. For example, if a business has $10,000 in the bank and withdraws $12,000 for its payroll, an overdraft facility is an automatic loan for the extra $2,000. The overdraft facility is payable on demand and, as with most loans, the business must pay interest on the amount borrowed.
References in periodicals archive ?
Contract award: lines of credit / overdraft facilities.
At present, post offices offer savings bank accounts, but cannot have credit or overdraft facilities.
ONE in 10 part-time students in Wales have funded their studies using credit cards and overdraft facilities, according to a new report.
However, member states may decide that such accounts should not include overdraft facilities, or to limit the amount of such overdraft facilities.
More than 30 million current accounts have overdraft facilities, and the FCA found using an arranged overdraft can quickly turn into a habit.
If you have all your overdraft facilities frozen, how can you trade properly?
Access to finance is captured through access to overdraft facilities, line of credit and self reported measures of access to finance.
There are banks that offer free authorised overdraft facilities - First Direct gives a PS250 interest-free overdraft, Santander a fee-free overdraft for four months and Nationwide for three months.
There are banks who offer free authorised overdraft facilities - First Direct give a PS250 interest-free overdraft, Santander a fee-free overdraft for four months and Nationwide for three months.
7,489 of the new issues came with overdraft facilities.
The report says: "This could suggest that the effects of the global recession - for instance, distressed corporate sponsors, restrictive bank lending policies and reduced overdraft facilities for clubs - are being felt in the international football transfer market.
For some, a packaged current account may be worthwhile as preferential overdraft facilities and additional benefits may be more cost effective.