| Commentary

136 Bank overdraft

| Commentary

4: SHORT-TERM FINANCE

136 Bank overdraft

Short-term finance provides the business with working capital1. Traditionally, the usual source of short-term finance has always been the bank overdraft which, as everybody knows, is a form of revolving-credit which is chiefly designed to address the cash flow problems which all suppliers face as a result of the time lapse between incurring the cost of making a product, or providing a service, and receiving payment for it from the buyer or customer. The character of such a facility is that the amount outstanding is always changing as the business continually draws

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