Auto-sweep Facility: How It Gives Interest Like FD On Your Savings Account

Auto-sweep facility: In this facility, you get more interest than a savings account. With this facility, you can also create an emergency fund. Many banks in the country provide this facility to their customers. However, all banks have different rules for this.
Savings Account, Interest Rate
Interest, FD, Savings Account, Interest Rate

Everyone wants to earn as much as possible. For this, they invest as much as possible. Many people invest in Fixed Deposit for safe investment. If we talk about the Savings Account, then it does not give more interest than the investment scheme. If you want to get more interest on your savings account, then you can use the auto-sweep facility. Today we will tell you about the auto-sweep facility of the bank. In this facility, you get interest like FD on the savings account. To start this facility, you have to go to the bank and make a request.

What is an Auto-sweep Facility?

In the sweep facility, the bank transfers the amount in excess of a specified amount in the customer's savings account to a sweep-in deposit. Understand it like this, if you have set a limit of Rs 10,000 for auto-sweep, then as soon as an amount in excess of Rs 10,000 comes into your account, it will be automatically transferred to sweep-in deposit. The tenure of sweep-in deposits is different in every bank. In some banks, the tenure of this deposit is 5 years, while in some banks, this period is only 1 year. The interest rate of all banks in this facility is different and even the name of this facility is different.   

Also read: Saving: How Much Money Can You Keep In The Bank Account?

What is the name of this facility in the bank?

The name of the auto sweep facility in the State Bank of India (SBI) is the State Bank of India Savings Plus Account. In this, money will be transferred to the sweep-in deposit in multiples of Rs 100 from the limit. 

The name of this facility in HDFC Bank is Sweep-in Fixed Deposit.

The name of this facility in ICICI Bank is Flexi Deposit.

Who is eligible for an auto-sweep facility?

Not all bank customers get the benefit of an auto-sweep facility. Every bank has different criteria for this facility. Apart from this, to avail of this facility, the customer has to open an FD of at least Rs 25,000. 

Benefit of Auto-sweep Facility?

In this, you get more interest than the savings account.

Apart from this, it also helps in creating a separate fund which can be useful to you in an emergency. 

You do not have to pay any separate penalty or fee for withdrawing money from this fund. Even if the money in the account is less, interest is earned on the remaining amount as per the auto-sweep rate.

Keep these things in mind

Before availing of this facility, you should carefully read the terms and conditions of the bank.

All banks offer different interest rates on this facility, so you must compare the interest rates of different banks.

This facility proves to be very helpful for those who like to maintain a minimum balance in their savings account. You can use the amount present in the auto-sweep deposit at any time.

Related Stories

No stories found.
Outlook Business & Money