81084 92491 
Secure Your Financial Future with NSOT Overdraft Facility
Overdraft facility is a credit line facility wherein the personal loan borrowers can withdraw funds from the loan account as per their sanctioned credit limit. The borrowing limit is usually sanctioned after factoring in the credit profile, monthly income and cash flow statements of personal loan borrowers. The borrowers can withdraw from the loan account any number of times up to the sanctioned limit, and make repayments as per the availability of funds. The interest is charged only on the amount withdrawn, and not the entire overdraft limit. This makes overdraft facility an excellent loan option for those facing frequent cash flow mismatches.
Features of Overdraft Facility
The interest rates for overdraft are charged only on the amount withdrawn and not the entire sanctioned limit. However, the interest rate levied on the amount is usually higher than the term loans. Thus, overdraft would be best suited for those capable of repaying their dues within very short periods, say 2-3 months.
Personal loan borrowers can borrow the loan amount only up to the sanctioned limit. The overdraft limit is sanctioned based on the credit profile, monthly income, cash flow statements, etc. The borrower can withdraw from the sanctioned credit limit any number of times and repay them in entirety or in parts as per their cash flows.
Borrowers have the flexibility to repay their loan as per their cash flows. Some lenders require the borrowers to service the interest component on monthly basis.
Unlike term personal loans, there is no repayment schedule in personal loan overdraft facility. Borrowers have the flexibility to repay the principal component as per the availability of funds without incurring any prepayment charges. As per RBI guidelines, lenders are not allowed to levy any prepayment charges on the applicants availing term personal loans at floating rates. However, they are free to levy prepayment charges for fixed rate personal loans.