Bank customer's personal credit line that advances funds to cover an Overdraft. The line is activated by writing a check for more than the available balance in the account. Also called Cash Reserve checking. Overdraft protection allows the check to be honored by the drawee bank. The check writer avoids having to pay Not Sufficient Funds (NSF) charges when temporarily short of funds, but pays daily interest on the loan.
Overdraft Protection
| Banking Dictionary: Overdraft Protection |
| 5min Related Video: Overdraft Protection |
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 | Cash Reserve (in banking) |
| Cross-Sell (in banking) |
| M & F Bancorp Inc |
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 | Is overdraft protection a very inexpensive way to protect you from bouncing checks? |
| What isthe Difference between bank overdraft and clean overdraft? |
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 | Banking Dictionary. Dictionary of Banking Terms. Copyright © 2006 by Barron's Educational Series, Inc. All rights reserved. Read more |
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Mentioned in
- Cash Reserve (in banking)
- Cross-Sell (in banking)
- M & F Bancorp Inc
- Overdraft (in banking)
