CC= Cash Credit Limit OD=Overdraft Limit

Banks do not advance 100% of the value of underlying securities when they sanction you a CC/ OD limit.

CC or Cash Credit is the limit upto which a bank is willing to give cash as a short term borrowing to a company.
It has nothing to do with the Current Account of the Business.
CC Limit varies from bank to bank and customer to customer based on their Creditworthiness.

OD or Overdraft Limit is the excess withdrawal over the Current Account Amount.
Every Current A/C Holder enjoys this facility, wherin they can borrow in excess of their funds in the account
This limit is enhanced or reduced based on the Customer's Credit worthiness.

 

The difference between the value of the security pledged and the overdraft / cc limit available to you is called as Margin Money.

This is sort of safety cushion for the bank. For e.g. if you pledge Fixed Deposit Receipts of Rs.1,00,000/- you will be sanctioned say 80,000/- as your OD/CC limit.

Thus 20,000/- is the Margin Money. You can also view margin money as your contribution/stake in the facilities granted to you by the financial institution/bank.