Finance Minister Nirmala Sitharaman also took Rs 10,09,282 from the Syndicate bank under overdraft facility. He took this amount for one year.
When you need money in life, it is difficult to say. Corona epidemic period has explained this to the people. Also, the importance of savings and investment has also been known to the people. Many times we suddenly need money. If there is no cash in the house, then we first look at our bank accounts.
If there is no money in the bank account, then we look at our investment schemes. If the investment is broken before maturity, it is a loss deal. We do not get the full benefits of those schemes i.e. returns including full interest. In such a situation, we spread our hands to our friends or relatives or we have the option of loan from the bank.
If you take a loan from a bank, then you have to pay a hefty interest on it. Then what is the solution? The solution is in your bank account only. A special facility is given to you by the bank, which is called Overdraft facility. You may also be surprised to know that India’s Finance Minister Nirmala Sitharaman, who presented the country’s budget , also needed money at one time and he also took advantage of this facility. We are going to tell you what this facility is and how you can take advantage of it…
What is overdraft facility
All government and private banks in the country offer overdraft facilities. Most banks offer overdraft facility on current account, salary account and fixed deposit (FD). Some banks also provide an overdraft facility in lieu of insurance policies, shares, bonds or other such assets. Under this facility, you can take the money you need from the bank and later pay this money.
Finance Minister has taken advantage of this facility from Syndicate Bank
The country’s Finance Minister Nirmala Sitharaman also took Rs 10,09,282 from the Syndicate bank under an overdraft facility. He took this amount for one year. This was revealed when the Union Council of Ministers, including Prime Minister Narendra Modi, announced their assets. This is mentioned in the details of their assets and liabilities recorded on the website www.pmindia.gov.in .
How to get overdraft facility?
If regular salary is deposited in your salary account then that customer can use overdraft facility. To service an overdraft, you have to apply to the bank. Many banks also provide this facility in their online app. If there is no FD in your bank, then first you have to mortgage any assets. You get this facility after fulfilling some important conditions.
If you keep a correct balance in your account, Banka considers you a good customer. Many banks already offer overdraft facilities to such good customers. In this case, taking a loan also becomes very easy.
How much money can I take in this facility?
Generally, your bank will decide how much money you can take under overdraft. This limit depends on what and how much collateral you have in the bank for this facility. In case of salary and FD banks limit the bank.
Simply put, if you have an FD of Rs 2 lakh in your bank, then the bank can set a limit of Rs 1.60 lakh (80%) for overdraft. The limit can be 40 to 70 percent in case of shares and adventure.
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How different is an overdraft facility from a credit card or loan?
Overdraft facility is very cheap in case of credit card or other personal loan. In this, you have to pay relatively less interest. Another advantage is that for the amount of time you take money in overdraft, you have to pay interest for the same amount of time.
Whereas personal loan is available for fixed period. You also have to pay a prepayment charge like a penalty if you pay it ahead of time. Apart from this, in personal loans you also have to bear other expenses like processing charge.
You also have to pay a fine if you do not pay the money in credit card on time. At the same time, under the overdraft facility, you do not have the obligation to pay money in EMI. You can repay the money anytime within the stipulated period.
