A fraction of the available credit on a loan agreement deposited by the borrower with the bank in a low or non-interest-bearing account is called a:

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A fraction of the available credit on a loan agreement deposited by the borrower with the bank in a low or non-interest-bearing account is called a compensating balance. This is done to offset the risk that the borrower might default on the loan. The bank may require the borrower to maintain a certain level of compensating balance, which cannot be used to pay off the loan, but must be held in the account as a guarantee.

A Fraction of the Available Credit on a Loan Agreement