What is difference between over draft and over drawing in banks

Question

Accepted Answer

Overdraft is a facility provided by the bank to withdraw more money than available in the account, while over drawing refers to withdrawing more money than available without any prior arrangement.

Overdraft is a pre-arranged credit facility offered by the bank to account holders.
Overdrawing refers to withdrawing more money than available in the account without any prior agreement.
Overdraft usually incurs interest charges, while over drawing may lead to penalties or fees.
Example: If a bank account has an overdraft limit of $1000, the account holder can withdraw up to $1000 more than the available balance. If the account holder withdraws $1100 without any overdraft arrangement, it is considered over drawing.

Accepted Answer

Over drawing facility , this facility is usually required to those account holders which sale is more than five times they require eg if I require 1 lakh over drawing facility it necessary my bank transportation should be 5 lakh. Usually this facility is given to cc(cash credit) account holders. And over draft facility is given to temporary accounts like cd account holders.

What is difference between over draft and over drawing in banks

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