One awkward situation business owners and individuals engaged in any form of business activity look forward to avoid is overdraft. Try as some may, they can’t avoid overdrafting and this lands them up in debts.
Dr. Owusu Ansah, a Senior Lecturer at the Ghana Institute of Management and Public Administration (GIMPA) has advised that individuals and business owners who run their accounts without checking their balance are likely to pick up debts they haven’t planned for.
Speaking on ATV’s Sika Sem show, Dr. Owusu Ansah noted that the practice which is common in developed countries allows customers to credit from banks when their account reaches zero.
He also explained that an overdraft allows the individual to continue withdrawing money even if the account has no funds in it or not enough to cover the withdrawal.
In Ghana, the trend according to him is rampant in the telecommunication industry.
“The telcos allow you to borrow credit for phone cals but deduct when you latter recharge”, he said.
“Some businessmen use their checkbooks without checking their balance. In abroad, when you have fewer funds in your account, your bank will allow you with limits attached to buy whatever you want. But as soon as your account is credited, your bank would deduct their money with interest from it”, he said.
He added that “it is better to know the money in your account to avoid overspending.”
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