Interest on Utilised Amount Only
Revolving Limit
A Business Overdraft, Sized and Priced the Right Way
Independent overdraft advisory from Inwealfoney. We help you get the right limit against the right security — bank or NBFC — so cash flow gaps never stall your business.
OD rates from
9.50% p.a.*
Limit up to
₹1 Cr+
What is a business overdraft
A standing limit, not a fixed loan
An overdraft (OD) lets your business withdraw more than your account balance, up to a sanctioned limit — you draw, repay, and redraw as many times as needed within that limit. There's no fixed EMI; interest is charged only on the amount actually utilised, and the limit is renewed annually based on your latest financials.
Secured
OD Against Stock & Debtors
A cash-credit-style limit set against hypothecated stock and book debts. Drawing Power is recalculated periodically from your stock/debtor statement, minus a margin.
Secured
OD Against FD / Property
A lien is marked on your fixed deposit or a charge created on property, and a limit is sanctioned against it — usually the fastest and cheapest OD to get approved.
Unsecured
Clean OD on Banking Relationship
Sanctioned purely on turnover, GST filings, and current-account banking history — no collateral, but typically a lower limit and a higher rate than secured OD.
Multi-lender comparison
Your file is matched against several banks/NBFCs for the best rate and margin.
Right limit sizing
We work out a Drawing Power and limit that matches your real cash cycle, not an arbitrary number.
Renewal support
We prepare your annual renewal file early so your limit doesn't lapse mid-cycle.
Documentation support
Stock statements, financials, and CMA data — assembled in the format your lender wants.
Eligibility
Do you qualify? Here's what lenders actually check
Criteria vary by lender and by whether the OD is secured or unsecured — these are the core checks in 2026.
- ✓Business vintage: 1–3 yearsNot required for pure OD-against-FD; stock/debtor-based OD typically needs 2–3 years.
- ✓Collateral: FD, property, or stock & book debtsDetermines both the limit and the rate — property-backed OD usually prices lowest.
- ✓Minimum turnover: ~₹40 lakh+ (stock/debtor OD)Not applicable for OD purely against FD.
- ✓CIBIL/CMR of promoters: 700+Business and promoter credit history both get reviewed.
- ✓Margin: ~25% on stock/debtorsDrawing Power = value of stock/debtors minus this margin, recalculated periodically.
- ✓Business vintage: 2–3 yearsSome digital lenders accept 1–2 years with strong GST/banking data.
- ✓Minimum annual turnover: ~₹10 lakh+Higher turnover unlocks a proportionately larger limit.
- ✓GST registration & regular filingConsistent GST returns are one of the strongest inputs for unsecured underwriting.
- ✓CIBIL/CMR of promoters: 750+ preferred700+ can still qualify, usually at a smaller limit or higher rate.
- ✓Current account relationship: 6–12 monthsAn existing account with steady credits significantly improves approval odds.
OD at a Glance
Limit range₹1 Lakh – ₹1 Cr+
Interest rate9.5% – 18% p.a.
Tenure12 months, renewable
Margin (secured)~25% on stock/debtors
Processing fee0.5% – 1% of limit
Interest is charged only on the amount drawn, calculated daily and typically debited monthly — not on the full sanctioned limit.
Documentation
What you'll need to keep ready
Having these scanned and organised before you apply typically shaves days off sanction time.
KYC & Business Documents
- PAN & Aadhaar of all promoters/partners
- Business PAN & GST certificate
- Udyam/MSME registration
- Partnership deed / MOA & AOA / LLP agreement
Financial Documents
- Last 2–3 years' ITR with computation
- CA-certified P&L and balance sheet
- Last 12 months' GST returns (GSTR-3B/1)
- CMA data (for larger secured limits)
Bank Statements
- Last 12 months' current account statement(s)
- Statements from all operating banking relationships
- Existing OD/CC account statement, if any
Collateral Documents (Secured OD)
- FD receipt (for OD against FD)
- Property title deed & valuation report
- Latest stock statement & debtor/creditor ageing
Existing Credit Facilities
- Sanction letters of any running loans/OD/CC
- Latest CIBIL/CIR (company & promoters)
- NOC from existing lender, if switching
Business Continuity Proof
- Shop Act licence / trade licence
- Rent agreement or ownership proof of premises
- Latest utility bill in business name
Note: Exact requirements vary by lender, limit size, and whether the facility is secured or unsecured. Share your profile with us and we'll send a checklist customised to the bank/NBFC we're targeting for you.
Interest Estimator
Estimate what your OD will actually cost
An overdraft has no fixed EMI — your real cost depends on how much of the limit you actually draw, and for how long. Drag the sliders to estimate.
₹10,00,000
50%
12.00%
₹0
Est. Monthly Interest
Utilised
Unutilised
Avg Utilised Amount
₹0
Est. Annual Interest
₹0
If Taken as Full Term Loan
₹0
Estimated OD Saving
₹0
*Indicative estimate only, assumes simple interest on average daily utilisation. Actual interest calculation, compounding, and charges depend on lender policy and how your limit is actually drawn.
How Repayment & Renewal Actually Work
01
Interest debited monthly
Interest on the utilised amount is calculated daily and typically debited to your account at each month-end — there's no separate EMI to track.
02
Draw & repay anytime
Deposit funds to reduce utilisation, or draw again — as long as you stay within the sanctioned limit and current Drawing Power.
03
Drawing Power recalculated
For stock/debtor-based OD, your Drawing Power is refreshed against updated stock statements — usually monthly or quarterly.
04
Annual renewal
The facility is reviewed and renewed every 12 months based on updated financials, turnover, and conduct of the account.
FAQs
Common overdraft questions
Only on what you use. Interest is calculated daily on your outstanding drawn balance, not on the sanctioned limit — the unutilised portion costs you nothing beyond any applicable commitment charge some lenders levy on large limits.
Drawing Power (DP) is the amount you're actually allowed to withdraw at any point, even if your sanctioned limit is higher. For stock/debtor-based OD, it's calculated as the value of hypothecated stock and receivables minus a margin (commonly around 25%), and is refreshed periodically from your latest stock statement.
Not always. OD against FD or property is secured and typically the cheapest. Unsecured or "clean" OD is available purely on turnover, GST records, and banking relationship, but usually comes with a smaller limit and a higher rate.
Most OD facilities are sanctioned for 12 months and reviewed annually. The lender reassesses your limit based on updated financials, turnover trends, and how the account has been conducted — timely renewal filing avoids a lapse in your facility.
The two work almost identically — a revolving limit with interest only on utilisation. Cash Credit (CC) is specifically tied to hypothecated stock and book debts with a formal Drawing Power, while "overdraft" is the broader term also used for OD against FD, property, or a clean banking relationship.
Yes — OD against FD, property, or an unsecured clean OD typically don't require periodic stock statements. Only stock/debtor-based CC-style OD needs regular (usually monthly) stock and debtor statements to maintain Drawing Power.
Expect a processing fee (roughly 0.5–1% of the limit) at sanction/renewal, possible inspection or stock-audit charges for secured OD, and sometimes a commitment charge on the unutilised portion of large limits. Ask for the full fee schedule before signing.
Let's size the right OD limit for your business
Share a few details and we'll compare lenders on your behalf — no cost, no obligation, and no walking into ten different branches.
Inwealfoney · Loan advisory services. Overdraft limits, rates, margins and eligibility are indicative and subject to lender policy at the time of application.