An overdraft allows companies to stabilise their cash flow when they experience delays in collections, and need to cover unforeseen expenses or obtain current assets.
An overdraft is a convenient tool that ensures stable cash flows when your company is facing unexpected expenses or delays in collections, or needs to obtain current assets.
- The minimum credit limit is 6,400 euros and the maximum limit depends on the monthly turnover of the applicant company in the bank.
- The overdraft limit shall relate to the current account of the customer, allowing the account balance to become negative.
- The source of repayment shall be positive cash flow from current business activities. Credit payments and repayments can be made in any amount within a fixed limit.
- The price of an overdraft consists of the limit fee to be paid quarterly in advance for the following quarter, and interest calculated on the amount used and to be paid at the end of each quarter.
- The interest consists of a floating interest rate and a customer margin.
To apply for an overdraft:
- The company and its owners must not have any overdue debts that have been postponed.
- The company’s equity capital must meet the requirements of the Commercial Code.
- The company must be capable of meeting the intended loan obligation.
- The company must be trustworthy.
- Audited (if the company is subject to auditing) financial reports from the previous financial years, as well as the balance sheet and income statement of the financial year, which are not older than three months.
- You may be required to provide additional documents.