In today’s time, most people have a savings account. If you do online transactions, you also need a savings account to activate UPI.
Through a savings account, banks provide the facility to a person to keep money in the bank for their needs.
Interest is also given by the bank on the savings account, but is the interest low?
Therefore, if a substantial amount remains in your savings account, you should add its Auto-Sweep facility.
You can also take advantage of FD on your savings account through Auto Sweep Facility. Learn about this facility.
Know what is an auto-sweep facility
By adding the auto-sweep facility to a bank account, an automated feature is added to your account.
In this, the amount deposited more than a limit is automatically converted into a fixed deposit, i.e., FD, and you get FD interest on that amount.
At the same time, if the balance in the account is less than that limit, the FD money automatically returns to the savings account.
In this way, you get the benefit of both a savings account and FD on your same account.
How to get the benefit of the auto-sweep facility
To avail of the auto-sweep facility, you need to link your savings account with the FD account.
Meanwhile, you have to decide the limit of the fund yourself. That is, while enabling this service;
you must tell the bank that after the small amount in your account, the remaining money should be transferred to the FD account.
Benefits of Auto Sweep Facility
- Generally, the interest received on a savings account is much less than that of an FD.
Banks mostly give you 2.50 to 4% interest on a savings account, but you can also get 5 to 7% interest on FD.
In this case, you can get good returns through FD on a savings account after adding an auto sweep facility.
2. When you get an FD done, interest has to be deposited in it for a certain period.
If you break the FD in the middle, you incur a loss. But due to the addition of this FD in the savings account,
you do not remain in any such bondage. You can withdraw money from your account anytime.
