When a payor bank gets an item payable from a customer's account with insufficient funds, the bank may:

Name: When a payor bank gets an item payable from a customer's account with insufficient funds, the bank may:
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Both options A and B are possible actions a bank can take when presented with an item for payment from an account with insufficient funds. The bank may choose to honor the payment, creating an overdraft, or it may refuse the payment and return the item.

When a Payor Bank Gets an Item Payable from a Customer's