(i) Explain Fund Based and Non-Fund Based Credit Facilities. (ii) Calculate the amount of fund-based and non-fund-based credit facilities availed by Veena Ltd. from Bank from the following details: Sr. No. Credit Facilit

Answer 5(c) (i) Fund based credit facilities are those in which an actual outflow of funds from the bank to the borrower takes place, typically involve cash transactions, whereas non-fund-based facilities are those, which do not involve such immediate outflow of the bank's funds or do not deal with cash transactions or funds. Examples of fund-based facilities are term loans, cash credit and overdraft whereas non-fund-based facilities are letters of credit, bank guarantees etc. (ii) Calculation of Fund based and non-fund based credit facilities availed by Veena Ltd. Credit Facilities provided by ₹ In Lakh Fund Based Credit Facilities Clean Overdraft 9.80 Car Loan 60.95 Key Cash Credit 35.50 Post Shipment Packing Credit 80.40 Total Fund Based Credit Facilities 186.65 Non-Fund Based Credit Facilities Stand by Letter of Credit 2.50 Bank Guarantee 12.50 Letter of Credit 22.50 Suppliers Credit 30.50 Total Non-Fund Based Credit Facilities 68.00 Hence, Veena Ltd. has availed ₹186.65 Lakhs fund-based facilities and ₹68 Lakh Non-Fund-based facilities from Bank.