What you should consider before taking a bank overdraft
http://ift.tt/eA8V8J By Adaeze Okechukwu ABANK overdraft is a temporary loan banks give to individual and corporate account holders that enable them withdraw funds above the balance available in the account. Thus, an overdraft allows the individual to continue withdrawing money even if the account has no funds in it or not enough to cover the withdrawal. However, there is usually a limit on the amount that can be overdrawn from the account. The overdraft limit is usually set by the bank based on the amount of working capital (the cash available for the company’s day-to-day operations) and credit worthiness (the ability of the borrower to honour the agreed debt obligation) of the borrower. It is worth noting that the borrower is charged an interest based on the amount overdrawn and the period of time overdrawn. When do you need a bank overdraft? An overdraft can be the solution when the bills are due, money is tight,...