Overdraft Interest Calculator

Amount Overdrawn:
Number of days in a billing period:
Rate of Interest:
% Yearly
Amount Overdrawn: ₹ 50000

Number of days: 24 Days

Rate of Interest: 24%

Loan Period: 15

What is overdraft?

In simple terms, overdraft is a financial facility offered by banks to help account holders withdraw money from their savings and current account, even if the account balance is below the minimum required balance or zero. This limit is assigned to each customer depending on his credit score, repayment history, account value and others. This facility is well known as short-term cash loan facility that the customer can utilize at any point in time upto the assigned credit limit. However, this facility can be availed by paying the interest on the utilized credit amount.

How is overdraft interest calculated?

The interest of overdraft is calculated on the basis of the amount you withdraw. For instance, if you hold Rs. 50,000 in your overdraft account and withdraw Rs. 10,000, then the interest will be calculated on the amount withdrawn.

In this case, consider the rate of interest as 10% pa.

Overdraft account eligibility

Different types of bank accounts have diverse eligibility criteria for availing this facility.

The account holders should also hold another savings account and pay the renewal fee associated with it. However, the interest charged on overdraft is not more than 2%.

Popular overdraft account offered by banks in India are SBI Loan Against Time Deposit and Citibank Suvidha Savings Account.

Benefits of Bank overdraft

Disadvantages of bank overdraft

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