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Bank Overdraft is a facility wherein a bank customer can withdraw more money than what is actually available in his/her account. Let us say I have an overdraft account with ICICI Bank and have only Rs. 5000 in my account, I can withdraw even 15000 or 20000 from my account. I will have to repay this money that I took from them in future or else they will charge me an interest. The bank will also set an Overdraft limit which will define how much money over and above my bank balance I can withdraw.

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Q: What is Overdraft account?
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Related questions

Can you overdraft account with no money?

Yes, any check you write on an account with no money is a overdraft.


What is authorised overdraft?

An authorised overdraft is an amount of money that you have agreed with you bank and which you can withdraw from the account for which the overdraft has been set up, the overdraft being the extra fund you have access to when your account does not hold sufficient funds.


What cause overdraft on cheque account?

Writing a check for more money than is actually in the account will result in an overdraft.


Advantage of overdraft?

Having overdraft protection on your account helps you avoid excessive fees. When the money isn't in your main account, your overdraft account will protect you by providing the money for the charges.


What is the name of the fee for an overdrawn account?

Overdraft


Is it illegal to overdraft your account intentionally?

Yes


How do you repay an overdraft?

You don't actually repay and overdraft fee. When your account becomes negative the overdraft fee is then taken out adding to the original negative amount. In order for the bank to allow you to cash checks against your account or even keep the account you have to make a deposit to make the account good. When making the deposit that's when you essentially pay back the overdraft. For example if your account was in the negative $20.00 you are then hit with and overdraft fee commonly $35.00 so to make the account good and to use it you have to deposit at least $55.00


Can a bank overdraw your account to pay their own charges?

It Depends: Yes - If you have a valid overdraft account with the bank and you currently do not have enough balance in your account to pay for bank charges No - If you do not have a valid overdraft account with the bank.


Can overdraft be possible in savings account?

No, overdraft is not possible in a savings account. Overdraft occurs when you spend more money than you have in a checking account. Savings accounts typically do not have the feature of overdraft protection, so you can only spend the amount that is available in your account.


What is a fee you are charged when you write a check and do not have enough money in your account to cover it?

You may be charged one of two fees: - An insufficient funds (NSF) fee, if you do not have overdraft protection - An overdraft protection (ODP) fee, if you have overdraft protection and money is transferred from your overdraft account to cover the check


What does overdraft on your checking account mean?

== == Overdraft on your checking account happens when a withdraw or check written exceeds the funds in the account. Often banks will honor the withdraw or check but then charge the account owner on the borrowed funds. Many banks will offer overdraft protection which will pull money from a different account (often a savings account, line of credit, or credit card).


What is the best kind of checking account to have?

The benefits of a bearing checking account is that if there are errors of overdraft you can dispute them better but overdraft protects the person from paying more in the long run.