Question

someone please differentiate between cash credit, overdrafts and bills of exchange in simple words.....please!!!!​

Answer 1

At the simplest level, cash credit and overdraft are just forms of borrowing. An institution allows you to withdraw funds that you do not have, usually in small amounts. The primary difference between these forms of borrowing is how they are secured.

Answer 2

Meaning -Cash credit is a type of short term loan provided to companies to fulfill their working capital requirement. Overdraft is a facility given by the bank to companies, to withdraw money "more" than the balance available in their respective accounts.

Security Pledge or hypothecation of inventory. Assets like financial instrument and property.

Account Cash Credit Account Current Account