Drawing power: the monthly maths behind a CC limit
Your sanctioned limit is a ceiling. Drawing power is what you can actually use.
4 min read
What you need to know
Drawing power is computed from the monthly stock and debtor statement: paid stock less a margin of around 25%, plus book debts under 90 days less a margin of around 40%. The result is capped at the sanctioned limit.
Late or inflated stock statements are the fastest way to damage a banking relationship. Submit by the due date every month, and reconcile the stock figure with your GST returns before sending it.
Continue your research
Use this guide alongside our product details and eligibility criteria before choosing a lender.
Frequently asked questions
What is the main takeaway from “Drawing power: the monthly maths behind a CC limit”?
Your sanctioned limit is a ceiling. Drawing power is what you can actually use.
What should I check before acting on this business finance guide?
Review the practical points in the guide against your income, obligations, documents and lender requirements.
Can the information in this guide guarantee loan approval?
No. It is general educational information. A bank or NBFC makes the final decision after checking your credit profile, repayment capacity, documents and the applicable product policy.
How can iFINTRUST help after I read this guide?
An iFINTRUST advisor can review your requirement, explain the documents normally requested and help you compare suitable lending options before you apply.