An agreement between a bank and a company or, rarely, an individual to provide an unspecified amount in loans on demand from the borrower. The borrower is under no obligation to actually take out a loan at any particular time. Funds borrowed are not repaid on any particular schedule, but they must be repaid on demand from the bank. This agreement is fairly common in situations where a business must make payroll but does not always have the operating income to do so. See also: Committed facility, Line of credit, Overdraft facility.
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