A bank overdraft is the same as a bank account that can have a negative balance, up to the sanctioned overdraft limit.
Example:
If your bank account has Rs.10 lakh in the bank and you withdraw Rs.12 lakh for business purposes, an overdraft loan is a by default loan for the extra Rs. 2 lakh. By withdrawing Rs. 12 lakh from your bank account, the balance will be zero and further even negative. Banks will charge an interest rate on an extra amount borrowed of Rs. 2 lakh.