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Overdrafts

An overdraft involves a financial institution, such as a bank, allowing you to withdraw more money from your bank account than you currently have, up to a certain limit. It can be a convenient option for short-term borrowing.

 



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What is an overdraft?                        
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Eligibility and exclusions                   
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Benefits and scenarios                     
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Risks                                                
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       Things you can use to secure the finance
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Is an overdraft a good fit for you?     
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What is an overdraft?

 

An overdraft is like a safety net provided by a bank. It allows you
to spend a little more money than you have in your account, so
long as you can pay it back later. 

It's often a helpful way to handle small, temporary financial gaps,
but it's important to be cautious and not rely on it for long-term funding.

Eligibility and exclusions

 

A business owner with a stable financial track record, consistent
cash flow, and a good credit score would be eligible to use an
overdraft to fund their business. Banks generally prefer working with
financially responsible and reliable businesses.

 

 

Benefits and scenarios

 

Overdrafts are usually quick and easy to apply for and can 
help you access cash quickly when you need it most.

You’re also only allowed to borrow up to a certain limit which
means you don’t have to take out a large loan all at once. It’s
also flexible and doesn’t tie you down to a long-term loan.

Risks

 

Borrowing money on an overdraft can be expensive
if you’re not able to pay it back.

If a bank starts to think that you’re not able to continue
to repay what you borrowed, it can reduce your overdraft
limit at any point, making it harder to borrow in the future.

Things you can use to
secure the finance

 

All you need to secure an overdraft is a bank account
with a good credit history and evidence of reliable
repayments.

Think an overdraft could be a good
fit for you?

 

Speak to one of our finance specialists today
to find out how you can get started.

Find out more: 

This is information, not financial advice or recommendations

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The information does not constitute financial advice or recommendation and should not be considered as such.

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