Overdraft Limit is the maximum amount a bank allows an account holder to withdraw beyond their available balance.
An Overdraft Limit is a pre-approved credit facility where a bank permits withdrawals above the account balance up to a fixed ceiling. It helps individuals and businesses manage short-term cash flow needs.
Banks set overdraft limits based on factors like income, credit history, or collateral, under guidelines of the Reserve Bank of India.
"If your account has ₹10,000 and your overdraft limit is ₹50,000, you can withdraw up to ₹60,000 in total."