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CC/OD — Cash Credit / Overdraft
Revolving credit facilities that allow businesses to withdraw up to a pre-sanctioned limit and pay interest only on the amount utilised.
CC/OD is the most flexible working capital tool available. Unlike a term loan (fixed disbursement, fixed repayment), a CC/OD limit allows you to draw and repay as your cash flows demand. Interest is charged only on the utilised amount on a daily basis.
CC limits are typically secured by stock and debtors. OD limits are secured by property or fixed deposits. Annual renewal with fresh documentation is required. Limits can be increased as business grows.
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