AU Small Finance Bank Sweep-out FD

What is an AU Small Finance Bank FD?

AU Small Finance Bank offers a sweep-out facility, which is a useful feature of your fixed deposits with AU Small Finance Bank. It's important to understand that sweep-in and sweep-out are two sides of the same coin, and the term sweep-out is often used to describe the initial action of transferring funds from an FD to a savings account. By using the Last-In, First-Out (LIFO) function, where the fresh new part of the FD will break, and the rest will continue to receive the high AU Small Finance Bank FD interest rates. 

Advantages of AU Small Finance Bank FD

• No Breaking of FD: The system typically uses a Last-In, First-Out (LIFO) method for the FD, where you don't need to break the full FD; just the latest part of it breaks and goes to the savings account. 
• Liquidity: You can access your funds at any time without having to manually break the entire FD. This is a significant advantage over a regular FD.
• No Penalty on Partial Withdrawal: When funds are swept out to cover a deficit in a savings account, you are not charged a penalty on the entire FD. The interest loss is minimized as only a part of the FD is liquidated.
• Convenience: The entire process is automated, so you don't have to monitor your account balance or manually create new FDs.
• No Overdraft Fees: The sweep-out facility can help you avoid overdraft fees or bounced cheque charges by ensuring your account always has sufficient funds.

How to Activate AU Small Finance Sweep-out FD

1. Online Activation

   To activate the AU Small Finance sweep-out FD online, you need to follow certain steps for it to activate - 

   • AU 0101 App / NetBanking: Log in to your account using your credentials
   • Go to the FD section: Navigate to the Fixed Deposit section.
   • Choose FD Type: Choose the type of fixed deposit you want to book 
   • Enter the Amount and Tenure: Enter the amount and tenure
   • Enter the Details: Set your maturity instructions and nominee details
   • Proceed: Confirm the information and proceed to fund the account

2. Offline Activation

   You can activate the AU Small Finance Sweep-out FD facility offline by visiting a branch:

   •  Visit a Branch: Go to your nearest AU Small Finance Bank branch.
   • Fill Out a Form: Complete the FD application form provided by the bank.
   • Submit Documents: Provide your identity proof, address proof, and other required documents.
   •  Specify your requirements: Clearly mention to the bank representative that you want to activate the sweep-out feature.
   •  Fund the FD: Deposit the amount you wish to invest.
   •  Processing & Activation: The bank will then process your request and set up the FD with the automatic sweep-out feature.

Conclusion

The AU Small Finance Bank FD with a sweep-out facility offers a unique blend of high FD interest rates and the liquidity of a savings account. By automatically transferring only the necessary portion of the FD to a savings account for covering expenses. It helps customers to avoid penalties and overdraft fees while ensuring their remaining funds continue to grow with high returns. This automated system provides convenience, security, and a smart way to manage funds for both planned and emergency needs.