Overview
- Customers with banking system exposure below Rs 10 crore can open and operate current, overdraft, and cash credit accounts without restriction, up from the earlier Rs 5 crore threshold.
- Restrictions on cash credit facilities have been removed, with the RBI noting these accounts function as working-capital lines distinct from current and overdraft accounts.
- For borrowers with exposure of Rs 10 crore or more, banks may maintain current or overdraft accounts only if they hold at least 10% of total exposure or 10% of fund-based exposure.
- If no bank meets the 10% test, or only one does, two banks with the largest exposures may maintain the current or overdraft accounts, and any lending bank with exposure above 10% may do so.
- Funds received into collection accounts must be remitted within two working days to a borrower-designated cash credit, current, or overdraft account.