Working Capital / Cash Credit
Revolving credit lines to manage day-to-day operational cash flow, raw materials, and receivables.
What is a Working Capital / Cash Credit?
Working Capital facilities — primarily Cash Credit (CC), Overdraft (OD), and Short-Term Loans — fund your day-to-day business operations: raw material purchases, salary payments, and bridging the gap between receivables and payables. Interest is charged only on the amount utilized, making it efficient for cyclical businesses.
Who is Eligible?
- Existing businesses with 1+ years of operations
- Turnover-based eligibility (typically 20–25% of annual turnover)
- Manufacturing, trading, and service businesses
- Acceptable credit score and track record
Key Benefits
- Revolving credit — draw, repay, redraw
- Interest charged only on utilized balance
- Linked to debtors, stock, and work-in-progress
- Available as Cash Credit, Overdraft, or Short-Term Demand Loan
- Annual renewal with enhanced limits basis growth
Documents Required
Step-by-Step Process
Working Capital Assessment
We compute your operating cycle and working capital gap.
Limit Calculation
We calculate the optimal CC/OD limit using banker-accepted methods.
Application
Submission to selected bank with complete documentation.
Inspection
Bank visits factory/premises for stock and debtor verification.
Limit Sanction
CC/OD account opened and limits made operational.
Frequently Asked Questions
What is the difference between Cash Credit (CC) and Overdraft (OD)?
Cash Credit is a limit against stock and receivables (renewed annually), while Overdraft is typically against fixed assets or personal guarantee. Both are revolving credit — you pay interest only on the amount used.
How is my working capital limit calculated?
Banks use two main methods: the Turnover Method (25% of projected annual turnover minus margin) or the MPBF method (Maximum Permissible Bank Finance based on operating cycle and working capital gap). We prepare both to negotiate the higher limit.
Can I convert my Overdraft into a Cash Credit facility?
Yes, subject to the bank's policy and your business profile — a CC limit typically offers higher operating flexibility and is renewable annually with enhanced limits based on turnover growth.
Interested in a Working Capital / Cash Credit?
Tell us your requirement and we will assess your eligibility in 24 hours — for free.
Apply Now +91 97146 31847