Cash credit is a short-term source of finance. Under cash credit, the bank offers its customer to take a loan up to a certain limit. Cash credit is also known as bank overdraft. This loan is given to meet the working capital requirements against a collateral security. This is very convenient and easy to raise and CC limits if utilized for business properly, it will help the business grow manifolds.
|1||Secured Loan||WC Made easy||Obligation to perform better|
|2||No Maturity||Easy to raise||Risk|
|3||Restrictive Covenants||Interest on utilized limits||Higher Rate of Interest|