Have idle money in your account? Are you busy and not having time to book or utilize the idle amount from your bank account? Auto sweep out is then the ideal option for you.
This facility is helpful for those who do very less transaction in the savings bank and have an excess amount.
What is Auto Sweep out?
Once you opt for this option your idle amount after the threshold amount will automatically be booked as fixed deposits. Usually, for your normal bank account you fetch interest around 4 per cent. By opting for Auto Sweep facility you can fetch around 8-9% depending on the bank.
Name of the facility also differs from bank to bank. Axis Bank has named its auto sweep account from bank Encash 24, HDFC name it as Super Saver facility.
Say for example, if your bank account needs to maintain minimum balance of Rs 10,000 and you have excess of Rs 50,000 lying in your account which is of no use for a few months, in such cases this facility can be opted.
What happens is that extra amount will be booked as fixed deposit. The tenure booked will differ from bank to bank.
You don't need to worry in case you need money.
You can withdraw from ATM or by check any time, requested money will be pulled from your fixed deposit. However, pre-mature withdrawal charges will be applicable depending on the bank.
Auto Sweep in
This is opposite of sweep out. Here the fixed deposit will be broken if the account runs short of the minimum balance.
This option is very useful option when you have issued a cheque and there is no sufficient balance in the account.