OVERDRAFT FACILITIES (OD FACILITY)

Flexible, On‑Demand Working Capital for Daily Business Operations

An Overdraft Facility (OD) is one of the most powerful and flexible working capital tools available to businesses in the UAE. It allows companies to withdraw more money than their actual account balance, ensuring continuous liquidity, uninterrupted operations, and smooth cash‑flow management.

Amanex Group helps businesses secure bank‑approved overdraft limits with optimized structures, competitive pricing, and high approval probability — tailored to your turnover, banking behavior, and financial profile.

WHAT IS AN OVERDRAFT FACILITY?

An Overdraft Facility is a revolving credit line linked to your corporate bank account. It allows your business to go into negative balance up to a sanctioned limit approved by the bank.

Example:

If your account balance is AED 20,000 and your OD limit is AED 300,000, you can withdraw up to AED 320,000.

You pay interest only on the utilized amount, not the full limit.

WHO IS AN OVERDRAFT FACILITY FOR?

OD facilities are ideal for businesses with regular cash‑flow cycles, including:

  • Trading companies
  • Importers & exporters
  • Manufacturers
  • Contractors
  • Logistics & supply chain companies
  • Retail & wholesale businesses
  • Service‑based companies
  • E‑commerce sellers

Any business that experiences delayed customer payments or seasonal cash‑flow gaps benefits from an OD.

KEY BENEFITS OF OVERDRAFT FACILITIES

1. Pay Interest Only on Used Amount

If your OD limit is AED 500,000 but you use only AED 80,000, you pay interest only on AED 80,000.

2. Instant Access to Funds

Withdraw anytime without applying for a new loan.

3. No Fixed EMI

Unlike loans, OD has no monthly EMI. You repay whenever funds come into your account.

4. Perfect for Daily Operations

Ideal for:

  • Supplier payments
  • Inventory purchase
  • Salaries
  • Rent
  • Utilities
  • Short‑term expenses

5. Revolving Credit

As soon as you deposit money, your OD limit is restored.

6. Strengthens Business Credibility

Banks view OD usage as a sign of active business operations.

HOW AN OVERDRAFT FACILITY WORKS

1. Bank Approves an OD Limit

Based on:

  • Monthly turnover
  • Average balance
  • AECB score
  • Business stability
  • Industry type

2. OD is Linked to Your Corporate Account

You can withdraw beyond your available balance.

3. Interest is Calculated Daily

Interest is charged only on the utilized amount, calculated daily and debited monthly.

4. Deposits Automatically Reduce OD

Every deposit reduces your outstanding OD balance.

5. Facility is Renewed Annually

Banks review your financials and renew the limit yearly.

ELIGIBILITY CRITERIA

Banks typically require:

  • Monthly turnover: AED 150,000 – 300,000+
  • 6–12 months bank statements
  • Clean AECB score
  • Active corporate bank account
  • Stable cash‑flow
  • Valid trade license
  • VAT returns (if applicable)

DOCUMENTS REQUIRED

  • Trade License
  • MOA / Share Certificate
  • Passport, Visa, Emirates ID
  • 6–12 months bank statements
  • VAT returns
  • Financial statements
  • Supplier invoices (if applicable)
  • Existing loan details

TYPES OF OVERDRAFT FACILITIES

1. Clean Overdraft (Unsecured OD)

No collateral required. Approved based on turnover and banking behavior.

Ideal for:

  • SMEs
  • Trading companies
  • Service businesses

2. Secured Overdraft

Backed by collateral such as:

  • Property
  • Fixed deposits
  • Machinery
  • Vehicles

Benefits:

  • Higher limits
  • Lower interest rates

3. Overdraft Against Fixed Deposit (FD‑Backed OD)

Fastest approval. Interest is extremely low.

Ideal for:

  • Companies with cash reserves
  • Individuals with FD holdings

4. Overdraft Against Receivables

OD limit based on customer invoices.

Ideal for:

  • Businesses with long credit cycles

USE CASES FOR OVERDRAFT FACILITIES

  • Paying suppliers
  • Purchasing inventory
  • Managing delayed customer payments
  • Handling seasonal demand
  • Covering operational expenses
  • Executing contracts
  • Emergency liquidity

EXAMPLE SCENARIO

A trading company with AED 400,000 monthly turnover secures a AED 300,000 OD limit.

This allows them to:

  • Pay suppliers on time
  • Purchase more inventory
  • Manage cash‑flow during delayed customer payments
  • Avoid taking multiple short‑term loans

OVERDRAFT VS TERM LOAN — COMPARISON

FeatureOverdraft FacilityTerm Loan
EMINo EMIFixed EMI
InterestOnly on used amountOn full amount
FlexibilityVery highMedium
Tenure1 year (renewable)1–5 years
Ideal ForDaily operationsExpansion projects

HOW AMANEX GROUP SUPPORTS YOU

1. Eligibility Assessment

We analyze your turnover, cash‑flow, and banking behavior.

2. Facility Structuring

We determine the ideal OD limit and structure.

3. Documentation Preparation

We prepare:

  • Financial summary
  • Business profile
  • OD justification
  • Compliance documents

4. Bank Submission

We submit your file to multiple banks for competitive offers.

5. Negotiation

We negotiate:

  • Higher OD limits
  • Lower interest rates
  • Better renewal terms

6. Approval & Activation

We coordinate with the bank until the OD facility is activated.

WHY BUSINESSES CHOOSE AMANEX

  • Strong relationships with UAE banks
  • Expertise in OD structuring
  • High approval success rate
  • Transparent advisory
  • Fast processing
  • End‑to‑end support
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