Suppose a person has Rs 10000 lying in his current account and if bank allows him to issue cheques up to Rs 12000 .
This facility is available for ________ period.
Which of the following options suits best in the above blank?
Answer & explanation
Correct answer: option 2
The correct answer is Option 2: Short
The facility allowing a person to issue cheques beyond their current account balance, known as an overdraft, is typically available for a short period. Overdraft facilities are usually provided for temporary liquidity needs and are subject to terms and conditions set by the bank, including limits on the duration and amount of the overdraft.