An overdraft (OD) is a financial instrument that allows you to withdraw more money than what is available in your bank account. It is a credit facility extended by banks to their customers, primarily to meet short-term financial needs.
The overdraft facility is linked to your current account and works as a safety net when you need extra funds. You only pay interest on the amount you overdraw, not on the entire limit. This makes it a flexible and cost-effective borrowing option for businesses and individuals alike.