Commercial Banking & Overdraft

1. Commercial Bank & Cash Deficit Policies

Commercial banking offers structured liquidity via standard bank loans as well as configurable cash deficit policies at the Commercial Bank:

• Policy 0: Production Halt (Debt Protection) (Default): If your cash balance drops to or below €0.00, factory production automatically halts dynamically (throttled to 0% with log reason Insufficient cash on hand). Operational expenses and worker wages drop to €0/min, completely protecting you from debt accumulation and zero interest is ever billed. Production resumes automatically on the next turn when cash is restored.
• Policy 1: Commercial Overdraft Line (Unlocked at Tier 1 Enterprise, €1,000,000+ net assets): Factories continue running at 100% capacity even when your liquid balance turns negative, drawing against an asset-backed operational credit line.
• Borrowing Base Limit: Equal to 10% of total corporate net assets (cash, bank deposits, inventory, machinery, and facilities), scalable by conglomerate financing boosts.
• Per-Minute Accrual: Billed strictly on actual negative cash at a base rate of 8.0% per day (divided across 1,440 turn minutes).
• 100% Tax-Deductible: Overdraft interest is fully tax-deductible, directly reducing daily taxable income on your Profit Sheet.
• Accounting HQ Discount: Each level of the Corporate Office Accounting Department lowers the overdraft rate by 1.0% per level down to a floor of 3.0% per day at Level 5.

2. Step-by-Step: How to Borrow Cash, Repay Loans & Pay Tax Advances

1. Navigate to Commercial Bank: Go to your Commercial Bank page.
2. Borrowing Funds: Select your desired loan principal amount based on your maximum credit limit (determined by Corporate Scale Tier and Bank Level) and click Take Loan. Funds are deposited instantly into your corporate cash balance.
3. Interest Settlements: Loan interest is calculated per turn cycle. Upgrading your Accounting Department in your Corporate HQ lowers interest rates by 5% per level.
4. Repaying Loans: Enter the repayment amount under the loan settlement section to clear your debt and restore your available credit line.
5. Tax Prepayment Buffer: You can also deposit advance tax prepayments under the Tax Prepayment tab at the bank. Tax prepayments shield your liquidity during midnight settlements. Learn more in the Taxes & Audits Guide.

3. Corporate Insolvency & Bankruptcy Safeguards

What happens if a corporation takes excessive debt or suffers crippling operational losses?

• Insolvency Threshold: If your total net assets (Cash + Inventory + Infrastructure minus Loans) fall below zero, your corporation enters financial distress.
• Bankruptcy Auto-Reset: Prolonged severe negative balances trigger corporate bankruptcy, automatically resetting the company back to a fresh Tier 0 Startup so you can rebuild without insurmountable debt traps.
• Prevention Strategy: Maintain positive cash flow, train your Accounting Department, and liquidate inventory on the market to service debts before bankruptcy occurs.

4. Corporate Solvency Ratios & Credit Ratings

Your bank credit limit and solvency metrics are continuously tracked by the Solvency Engine. For a full breakdown of the 8 financial health indicators, actual vs. theoretical profit run-rates, and asset write-offs, visit the dedicated Corporate Finance & Analytics Guide.