An overdraft is an extension of a credit facility from a Micro finance or bank that is granted when a client's account reaches zero. The overdraft allows the account holder to continue withdrawing money even when the account has no funds in it or has insufficient funds to cover the amount of the withdrawal. Usually with interest / fee charged on the credit extended.
Loan Performer has an option for allowing clients to overdraw their savings accounts and subsequently allows you to levy interest or commission charges for the overdraft.
To enable this overdraft facility, you must remove the overdraft protection for a particular savings product by unchecking the Overdraft Protection checkbox at System/Configuration/Savings/Savings Accounts Settings.
How to set overdrafts
To set overdrafts on savings products you go to Savings/Overdrafts/Set Overdrafts and a screen like the one below shows up:
Click on the Add button to save the overdraft settings or the Update button to save any changes made thereof.
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