Multiple choice general knowledge

A draft in excess of the credit balance

  1. Overdraft

  2. Underdraft

  3. Demand Draft

  4. Cheque

Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

An overdraft occurs when a draft or withdrawal exceeds the available credit balance in an account. It allows account holders to withdraw more money than they actually have in their account, up to a pre-approved limit. Underdraft is not a standard banking term, while demand draft and cheque are payment instruments.