Module: | Priority Sector, Consumer Protection & Digital Lending
Q141: Which of the following conditions characterize a Cash Credit/Overdraft (CC/OD) account as "out of order"?
1. Outstanding balance remains continuously in excess of the sanctioned limit/drawing power for 90 days.
2. Outstanding balance is within the limit, but there are no credits continuously for 90 days.
3. Credits in the account are insufficient to cover the interest debited during the previous 90 days.
4. The limit has not been reviewed within 30 days of the due date.
Which of the statements given above is/are correct?
2. Outstanding balance is within the limit, but there are no credits continuously for 90 days.
3. Credits in the account are insufficient to cover the interest debited during the previous 90 days.
4. The limit has not been reviewed within 30 days of the due date.
Which of the statements given above is/are correct?
✅ Correct Answer: C
The correct answer is C. A Cash Credit or Overdraft (CC/OD) account is treated as "out of order" strictly under three conditions: (1) The outstanding balance remains continuously in excess of the sanctioned limit or drawing power for 90 days. (2) The outstanding balance is within the limit, but there are no credits continuously for 90 days. (3) The credits are insufficient to cover the interest debited during the previous 90-day period.
Statement 4 is incorrect because while non-review of limits within 180 days can trigger an NPA classification, a delay of 30 days is merely an administrative irregularity and does not define the "out of order" status.
Statement 4 is incorrect because while non-review of limits within 180 days can trigger an NPA classification, a delay of 30 days is merely an administrative irregularity and does not define the "out of order" status.