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 ?
As of now, Uttar Pradesh is overdrawing electricity by five percent, Haryana by 51 percent and Rajasthan by 18 percent.
Mr Cowen-Wright said there is an onus on all customers to manage their accounts sensibly, but people are often angered by what are perceived as unreasonable charges - like pounds 25 per day for overdrawing without permission.
COST of overdrawing by pounds 200 for 5 days a month each year
Unsanctioned gas overdrawing from KazTransGas pipeline amounted to 44 million som during 2003-2005," Kulmurzaev said.
Meanwhile, the Central Electricity Regulatory Commission (CERC) issued a notice to the Uttar Pradesh Government and two other states - Rajasthan and Haryana-to explain the overdrawing of power and for blatantly flouting of norms governing access to electricity/power supply, which led to grid failures in the northern and eastern parts of India.