overdraft

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Overdraft

Provision of instant credit by a lending institution.

Overdraft

A situation in which a bank customer withdraws more from his/her account than he/she had previously deposited. For example, if an account holder has $1,000 in the account and withdraws $1,200, this is an overdraft of $200. The bank may or may not honor the overdraft, depending on its policies and the importance of the customer. Usually, however, an overdraft incurs a relatively steep penalty fee.

overdraft

A draft for more than the balance in the account on which the draft is drawn. A bank may honor an overdraft, depending on the importance of the customer and on prior arrangements (if any) to cover overdrafts. See also NSF check.

Overdraft.

An overdraft is a withdrawal from a bank account that exceeds the funds you have available.

If you overdraw your account and you have overdraft protection, the bank will transfer money up to the limit on your line of credit to your account to cover the withdrawal. Although you will pay interest on the amount the bank transfers to your account from your line of credit, it is likely to be less than the substantial fees you pay for each overdraft.

overdraft

a financial facility for advancing MONEY to an individual or business (the borrower) by a COMMERCIAL BANK, SAVINGS BANK etc. (the lender). An overdraft is a form of CREDIT which allows the borrower to withdraw as much money as required up to a prearranged total limit, whereupon interest is charged at a rate related to the base rate of interest on outstanding balances (see INTEREST RATE). In the case of businesses, overdraft facilities are often provided on an indefinite basis, thus providing the borrower with a continuous line of credit used mainly to finance WORKING CAPITAL requirements. See BANK LOAN.

overdraft

see BANK LOAN.
References in periodicals archive ?
The firm determined that the least expensive place to overdraw a checking account is San Francisco, with a median price of $22.
Most bowhunters who use overdraw rests also shoot mechanical bowstring releases.
If a customer chooses not to participate in overdraft protection, any transaction that overdraws their account would be denied.
If you are one of them, consider moving your account to a provider that rewards customers who don't overdraw.
Require banks to warn customers whenever an ATM/debit card transaction will overdraw their account, tell them the cost of the loan, and give the choice of whether to proceed or cancel the transaction.
The account holders are allowed to overdraw their transaction accounts, subject to pre-established limits.
The member is permitted to overdraw his/her transaction accounts, subject to pre-established limits, for a fee ranging from $17 to $35 (average $22.
Since the debit card is linked to your checking account, you could overdraw if you're not careful.
All institutions must responsibly deploy such programs, educating and frequently reminding customers of the terms and use of the programs, and avoiding messages that encourage customers with low balances to overdraw their checking accounts," she declared.
ODP "is a financial incentive (to institutions) to allow these customers to overdraw," one Kentucky banker reported.
DO speak to your bank and get approval if you want to overdraw.
The feature-rich VPU also offers HYPER Z(TM) III efficiencies that detect and reduce overdraw and cut memory bandwidth consumption by over 50 per cent, making the VPU more efficient.