Loans

Banks have variety of schemes under Personal Finance to satisfy varying needs of the banking public. Banks provide credit in the form of overdraft or loans.  Overdraft facility is generally provided on current account.  Overdraft is a service provided by a bank to utilize  money even when there is no balance in the customer’s account.  It is a form of credit and one has to pay interest for the overdraft drawn.  It is an arrangement made to cover the cash shortages. The rates differ from bank to bank and depend on the time period also. It is not suitable for long period of time. Bank loan is the money which one borrows from the bank for a specific purpose for specific period with agreement for interest and repayment periods etc.