Most of us keep our money in the saving bank account , which gives a return of 3-4 % annually . There is a better alternative to saving account ,which gives you the flexibility of a saving account and return of fixed deposit account , this account is called as Auto Sweep Account and is now offered by almost every nationalized bank in India . Auto sweep account is also called a multi option deposit account , it combines the benefit of a Savings Bank account and Fixed Deposit account . In the auto sweep facility your saving account gets linked with the fixed deposit account . Here you can select a threshold amount , when your saving account has funds above that threshold level , the extra money gets sweeped to the fixed deposit account , so you get the interest rate of fixed deposit on that amount . The good thing about this is you can withdraw the funds any time and when the balance goes below the thresold amount , funds get re sweeped to the saving account from the deposit account
Lets understand the working of auto sweep facility with an example . Lets suppose you need maximum 25 thousand for your monthly expenses and currently you are having 40 thousand in your saving account . If auto sweep facility is enabled in your account , then 25 thousand will stay in your saving account and the remaining 15 thousand will get transferred to the fixed deposit account . So you will get the fixed deposit return on that 15 thousand . The threshold of 25 thousand will be maintained in your account , and all the funds above 25 thousand will get auto sweeped to the fixed deposit account . In case if you have any emergence in a particular month , then you can withdraw the amount any time , the funds will get sweeped from the deposit account to saving account , and you don’t have to pay any penalty , which you generally have to pay when you break your FD before the maturity time . Auto sweep facility can make your money grow more than a simple saving account . This type of account is known by different names for different banks some of them are .
- IDBI Bank – Sweep-in Savings Account
- Axis Bank – Encash 24
- Union Bank – Union Flexi Deposit
- HDFC Bank – Super Saver Facility
- Bank of India – BOI Savings Plus Scheme
- Oriental Bank of Commerce – Flexi Fixed Deposit Scheme
- State Bank of India – Multi Option Deposit Scheme
- Allahabad Bank – Flexi-fix Deposit
- Bank of Maharashtra – Mixie Deposit Scheme
- Corporation Bank – Money Flex
- United Bank of India – United Bonanza Savings Scheme
- SBI – Multi Option Deposit
Abhishek is an Engineer MBA in Finance and Certified Research Analyst. He is an active trader and investor in the stock market since 2010. Follower of the philosophies of Warren Buffet and Peter Lynch in investing and trend following in trading.