Question

    A facility to withdraw money from a current bank

    account without having a credit balance but is limited to the extent of the borrowing limit, which the commercial bank fixes is called:
    A Cash credit Correct Answer Incorrect Answer
    B Term Loan Correct Answer Incorrect Answer
    C Fixed deposit Correct Answer Incorrect Answer
    D Demand Loan Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    Cash credit is a facility to withdraw money from a current bank account without having a credit balance but is limited to the extent of the borrowing limit, which the commercial bank fixes. The interest in this facility is not charged on the borrowing limit, which the bank gives but on the daily closing balance

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