Revolving limit · drawing power, not a lump EMI
Cash Credit (CC)
Revolving limit on stock and debtors
A sanctioned CC you operate like a tap: draw, repay, draw again — capped by monthly drawing power on paid stock and eligible debtors.
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Indicative ticket
₹5 Lakh – ₹5 Crore+
Tenure
12 months, renewable
Security
Stock & book debts; collateral as per lender
Category
Working capital
Working capital
A revolving MSME limit against stock and receivables — draw, repay, draw again within drawing power.
Year-round drawing power on godown stock and receivables. You draw, repay, redraw — ideal for traders and manufacturers with a standing cycle.
Overview
Cash credit is built for businesses that buy, hold and sell continuously. You do not take the full amount as a lump EMI loan. You operate within a limit. Interest is charged on utilisation. Lenders review drawing power, typically monthly.
A well-run CC is often cheaper in practice than rolling personal overdrafts, because it is sized to the cycle and reviewed on stock statements — provided books are honest and GST matches banking.
We help first-time CC applicants understand DP, hypothecation, inspection and why a ‘clean’ current account still matters.
What this facility offers
- Revolving limit — interest on usage, not always on full sanction
- Drawing power linked to paid stock and eligible debtors
- Annual renewal with enhancement if sales grow
- Fits manufacturers and wholesale traders especially well
- Can be combined with term loan and LC/BG in a package
Drawing power is the real limit
Sanction is the ceiling. Drawing power is what you can actually use — typically a percentage of paid stock plus eligible debtors minus creditors. Inflated stock that cannot be walked in the godown is a first-year problem.
Interest is on utilisation. A CC that sits unused still has renewal, inspection and hypothecation costs. That is still usually cheaper than rolling personal credit if the cycle is real.
Who this page is not for
Service firms with no stock often belong on OD. Traders who only need a GST-linked buffer may belong on GST OD. Manufacturers buying a line belong on machinery. CC is the standing inventory product.
Renewal is part of the product
CC is not ‘take the money and forget’. Stock statements, inspection, insurance of hypothecated stock, and a clean current account are the annual exam. A limit that was easy at sanction can shrink at renewal if DP was theatre.
Interest on utilisation is the honest cost. An unused CC still has renewal and documentation cost — still usually cheaper than rolling personal credit if the godown is real.
Unlike a term loan, you do not take the full sanction home. Unlike a clean OD, credit will ask for stock statements and may inspect the godown. Unlike GST OD, DP is not only a returns multiple.
CC is the wrong door for
- Capex on a 12-month line
- Personal overdraft
- Invoice line for one corporate buyer only
What inspection and DP will look at
- Monthly stock statements
- Hypothecation of stock and book debts
- Current-account bounces
Why a standing godown needs CC
- Wholesale distribution with 30–90 day credit
- Manufacturing raw-material cycle
- Replacing ad-hoc unsecured rolling credit
Traders and units with paid stock
- MSME traders and manufacturers who need a standing limit
Drawing-power eligibility — this product
- Established operating cycle with stock and/or receivables
- GST-registered MSME in most cases
- Ability to submit periodic stock statements
- Satisfactory current-account conduct
Monthly DP pack, not a one-time PDF
- KYC, Udyam, GST, entity proofs
- Financials, ITR, bank statements
- Stock, debtor and creditor statements
- Hypothecation and, if required, collateral papers
Sanction, hypothecation, then operations
Typical desk timeline: 3–5 weeks including DP setup
- 1
Login and share your brief
Create your MSME desk account or log in. Tell us city, Udyam band, turnover range and the purpose of funds in one clear sentence. Consent is recorded before any lender share.
- 2
Stock and debtor profile
We note paid stock, eligible debtors and creditors. Drawing power logic is explained before login — sanction ceiling is not the same as usable limit.
- 3
Product mapping on the desk
We check whether this facility fits your use — or whether cash credit, term loan, LAP or a scheme page is the cleaner file. Wrong product mapping is corrected here, not after login to a bank.
- 4
Monthly stock statements explained
You will submit stock and debtor statements for DP. We walk through what credit typically accepts and what triggers a DP cut.
- 5
Lender login and credit processing
The file moves to a partner bank, NBFC or HFC that matches your profile. Queries on GST vs banking, end-use or security are coordinated with you — we do not promise sanction from this website.
- 6
Sanction letter and agreement
If approved, you receive the lender’s sanction with rate, tenure, security and covenants in writing. Read processing, insurance and prepayment clauses before signing — they vary by institution.
- 7
Account opening, hypothecation and DP
CC account is opened, security is charged on stock/debtors, and first drawing power is released after documentation.
Ready to start?
Quick apply for Cash Credit (CC) without creating an account — or login if you want vault KYC and status tracking on your desk.
Cash-credit operations questions
What is drawing power?+–
The amount you can actually use, usually a percentage of paid stock plus eligible debtors minus creditors, capped at the sanctioned limit.
Can CC be used for buying a machine?+–
That is generally a term-loan or machinery-loan end-use. Using CC for capex can create a long-term hole in working capital.
OD, GST OD and WC loan live elsewhere
- Working Capital LoanShort-term and revolving funds so stock, payroll, GST and suppliers do not wait on collections.
- Business Overdraft (OD)Overdraft on the current account for MSMEs that need flexible, interest-on-usage liquidity.
- Invoice / Bill DiscountingUnlock receivables: discount accepted bills or invoices of creditworthy buyers.
Figures are indicative. Not an offer. Sanction, rate and security rest with the bank, NBFC or HFC. Scheme names are not a website promise.
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