Working capital is a necessary requirement for any type of business activity. Banks in India nowadays constitute the main suppliers of working capital credit to any type of business activity. Recently, though, several term lending financial institutions have also declared schemes for working capital financing.

Bank Overdrafts

Short-term borrowing of the type made available principally through the clearing banks in the appearance of overdrafts is extremely flexible. While the borrowed funds are no longer needed they can quickly and easily be fast. This is also comparatively inexpensive. The banks will enforce limits on the amount they can lend.