Sri Lanka Bank Overdraft (OD) Interest Calculator

An overdraft (OD) is a revolving current-account facility, not a fixed loan. The bank sanctions a limit and you can overdraw up to it; interest is charged only on what you actually draw — the daily debit balance — so the cost moves with your usage. This is why an OD suits irregular working-capital swings that a term loan handles poorly.

Interest accrues on the closing debit balance each day and is capitalised (added to the OD) once a month. The day-count convention Sri Lankan banks apply is Actual/365, so a single day's interest on a balance held for d days at annual rate r is:

interest = balance × r × d ÷ 365

When your drawn balance exceeds the sanctioned limit, banks split the charge. The portion up to the limit is charged at your normal rate; only the excess attracts a penal add-on:

• within-limit = min(balance, limit) × r × d ÷ 365
• over-limit = max(balance − limit, 0) × (r + penal) × d ÷ 365

The rate itself is quoted as AWPLR + margin. The Average Weighted Prime Lending Rate is published weekly by the Central Bank of Sri Lanka and is the benchmark most commercial ODs are priced against; your bank adds a fixed margin for your risk profile. As of 2026-07-15 the AWPLR anchor is about 10.5%, so a 14% default reflects a typical margin of 3.5%. The margin, the over-limit add-on and any commitment fee are commercial terms you enter from your facility letter — the tool does not quote a mandated rate.

An optional commitment fee applies to the unused part of your limit: max(limit − average balance, 0) × fee ÷ 365 × days. Total OD cost is the period interest plus any commitment fee, and the annualised effective cost expresses that total against your average drawn balance. Every figure is cross-checked against a literal day-by-day accrual so the closed-form band math is verified to the rupee.

• Central Bank of Sri Lanka — Interest Rates (weekly AWPLR), Financial Sector statistics
• Commercial Bank of Ceylon — overdraft facilities and tariff of charges
• Bank of Ceylon — overdraft product terms and tariff sheet

The AWPLR anchor and the Actual/365 daily-balance method were last cross-checked against these sources on 2026-07-15. The margin, over-limit penal add-on and commitment fee are bank-specific inputs you supply from your facility letter, so they are not verified here — the tool computes the interest, it does not quote a bank's rate.