What term describes a short-term bank credit facility permitting account holders to withdraw money beyond their actual available account balance up to an agreed limit?

Explanation

• A Bank Overdraft is a flexible short-term financing arrangement allowing commercial account holders to draw funds past zero balance up to a pre-approved credit ceiling.
• Interest is charged daily strictly on the overdrawn amount, making it suitable for managing temporary cash deficits.
• Letters of credit are international trade guarantees rather than direct short-term overdraft loans.