ICICI Bank launches instant overdraft option for MSMEsICICI Bank has launched a new product called ‘Insta OD’ which will offer an online and instant overdraft facility to Medium and Small Enterprises (MSMEs)

Under the Insta OD facility, MSME customers can get an overdraft up to Rs 15 lakh in an entirely paperless manner. They can avail this discount through corporate internet banking or through ICICI Bank’s website or its iBizz mobile app.

What is an OD?

An OD or overdraft is taken when you withdraw, transfer or spend money from a bank account in excess of the balance in it. This automatically becomes a loan and carries an interest.

Features of Insta OD

It will be available online, through ICICI Bank’s website or mobile app

Disbursal will be instantaneous.

Maximum limit is Rs 15 lakh. Actual sanctioned limit could be lower based on banking conduct and account transactions assessed by ICICI Bank over a 12-month period.

No prepayment or foreclosure charges

No collateral requirement.

Interest Rate

This would be the prevailing 6 month Marginal Cost of Fund Rate (MCLR) + 6.5%. The February 6 month MCLR at ICICI Bank was 8.15 which would take the OD rate to 14.65%.

Processing Fee

A 2% processing fee will be charged on the amount of OD taken.

Tenure

Up to 12 months and extendable by 12 months at a time with the consent of ICICI Bank. Renewal will attract another 2% processing fee.

OD Process

Login through the ICICI Bank website/corporate net banking/iBizz app

  • Submit the pre-filled form
  • Verify the OD amount, interest rate and processing fee
  • Confirm your acceptance

For more details, click here.

Author
Neil Borate

Neil Borate is Deputy Editor, RupeeIQ. He can be contacted at neil@rupeeiq.com.