To send money, the source is required to have enough funds to execute the transaction. If Blnk detects insufficent funds, the transaction is rejected.

However, there are certain transaction workflows that do not fit this default requirement.

​
What is overdrafts?

Overdrafts is a Blnk feature that lets you successfully record a transaction regardless of the source’s balance. When overdrafts is enabled, the transaction is processed and the balance (if insufficent) is allowed to go negative.

A very popular use-case for overdrafts is lending. You can also use it for internal balances that do not have a starting balance such as @World.

What we’ll cover …

  1. Enabling overdrafts
  2. Some real-life applications

​
1. Enabling overdrafts

Overdrafts are applied when recording a transacton. To enable overdraft, include the allow_overdraft parameter and set its value to true in your request body:

Request
{
    "amount": 112.30,
    "precision": 100,
    "reference": "ref-ghwe12009",
    "currency": "USD",
    "source": "@World",
    "destination": "bln_28edb3e5-c168-4127-a1c4-16274e7a28d3",
    "allow_overdraft": true,
    "meta_data": {
      "account_type": "savings"
    }
}

​
2. Some real-life applications

  1. Loans and credit facilities: You can easily implement lending features, track how much a customer has spent outside of their available balance, manage credit history, etc., and record it all in your Blnk Ledger.

  2. Internal money movement: Your internal balances can often face fluctuations in cash flow, especially during unpredictable periods. Overdrafts allow you to efficiently manage this without disrupting your financial operation.

    See also: Internal balances.

​
Need help?

We are very happy to help you make the most of Blnk, regardless of whether it is your first time or you are switching from another tool.

To ask questions or discuss issues, please join our Discord community.

Was this page helpful?

PrecisionInflight