Working Capital Loan
Manage inventory, supplier payments, operating expenses and everyday cash-flow needs.
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Cash Credit and Overdraft Facilities for Businesses
CC and OD facilities give you a limit you can draw from and repay as your cash flow moves. Understand how they work, how lenders typically set limits and what you need to prepare.
Use cases
Suitable business use cases
Fluctuating cash needs
Draw funds when you need them and repay when collections come in.
Seasonal businesses
Manage the peaks and troughs of seasonal buying and selling.
Inventory-heavy trading
Fund stock purchases against the value of stock and receivables.
Short-term mismatches
Handle timing gaps between payables and receivables.
Key eligibility factors
Lenders weigh these and other factors according to their own credit policies.
- Turnover, operating cycle and stock / receivables levels
- Quality and age of debtors
- Banking conduct and utilisation of existing limits
- Credit history of the business and promoters
- Primary security (stock, receivables) and any collateral the lender requires
- For OD facilities, the security offered — such as property or deposits — as per lender policy
Commonly requested documents
Indicative only — the exact list depends on the lender, your constitution and the proposal.
Business & promoter KYC
- PAN of the business entity and of promoters / partners / directors
- Address and identity proof of promoters, as required by the lender
- Udyam Registration certificate (where registered)
- GST registration certificate (where applicable)
- Constitution documents — partnership deed, LLP agreement or MoA/AoA
Financial records
- Income tax returns, typically for the last 2–3 years
- Audited or provisional financial statements (balance sheet, P&L)
- Business bank statements, often for the last 6–12 months
- GST returns for recent periods (where applicable)
Facility-specific
- Monthly stock and book-debt statements (for CC facilities)
- Ageing of receivables and payables
- Property or deposit documents, where offered as security
- Projected turnover for the coming year
Existing borrowings
- Sanction letters and repayment schedules for current loans
- Loan account statements showing repayment track record
The process
How the financing process works
- 1
Share your requirement
Tell us about your business cycle, stock and receivables.
- 2
Review your options
Understand whether a CC, an OD or another structure may suit you.
- 3
Prepare the application
We help prepare stock statements, projections and supporting records.
- 4
Lender assessment
The lender assesses the limit, drawing power and security.
- 5
Lender decision & set-up
If sanctioned, the limit is set up per the lender's terms and reviewed periodically.
Eligibility, approval, pricing, collateral requirements and disbursal depend on the lender and its applicable policies. LoanDhara does not lend and does not guarantee approval.
Cash Credit / Overdraft (CC/OD): frequently asked questions
Cash credit is usually secured by hypothecation of stock and receivables, and your usable limit depends on the value of those assets. An overdraft is often secured by other assets such as property or deposits, or sanctioned on the strength of your business profile. Exact structures vary by lender.
Drawing power is the amount you can actually use within a CC limit at a given time. Lenders typically calculate it from your latest stock and debtor statements after applying a margin.
Generally, interest is calculated on the utilised balance rather than the full limit. Lenders may also levy other charges — such as processing, renewal or charges linked to limit utilisation — under their terms.
More questions? See all FAQs or talk to an expert.
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