Sweep-in Sweep-out FD to Channelise Surplus Savings

What is Sweep-in Sweep-out FD (Auto Sweep)?

A Sweep-in Sweep-out FD automatically moves excess funds from your savings account into a fixed deposit up to a set limit. Instead of the bank holding the surplus in the form of idle money, the system deposits the funds in an FD, where it gains an FD interest rate. 

This allows you to earn returns on your surplus deposits through fixed deposits while remaining liquid. It also puts an end to the manual transfers and ensures easy access to your money anywhere you require it.

How Does Auto Sweep Work?

Firstly, enable the facility to establish a threshold limit in your savings/current account. Once the amount in your account exceeds this limit, the additional amount is automatically transferred to the fixed deposit in multiples which have already been established. This is termed as sweep-in.

The bank account keeps on earning the interest that it is supposed to, and the amount transferred earns a fixed deposit interest. This does not limit access to your money. 

In case you withdraw any sum, leading your balance to fall below the required level, the sum is automatically withdrawn from the fixed deposit to your bank account. This is referred to as sweep-out.

Let us understand this with an example. 

Assume that you have set up the auto sweep service on your savings account and you have set the threshold limit to ₹50,000. Once your balance in savings is ₹80,000, the surplus ₹30,000 is automatically placed in a fixed deposit, where it will start earning FD interest.

When you subsequently withdraw ₹20,000, and the balance becomes less than the threshold, ₹20,000 is automatically withdrawn back to the fixed deposit and deposited to your savings account. The balance will generate fixed deposit interest as long as it remains invested.

List of Banks Offering Sweep-in Sweep-out FD (Auto Sweep)

Several leading banks in India provide Sweep-in Sweep-out or Auto Sweep facilities under different product names. Below is a list of banks and their respective sweep-linked fixed deposit offerings:

SBI Bank Auto Sweep Facility

SBI’s Multi-Option Deposit (MOD) scheme links savings or current accounts with term deposits through a sweep-in and sweep-out facility. 

With the SBI Sweep in the FD facility, your surplus funds are put to work automatically:

• Extra funds above ₹50,000 are automatically transferred into a fixed deposit.
• Transfers occur in multiples of ₹5,000, keeping a minimum balance of ₹35,000.
• Deposits begin at ₹10,000, with periods from 1 to 5 years.
• Senior citizens receive extra interest.

The SBI Sweep out FD allows you to maintain liquidity anytime needed:

• Automatically transfers funds to your account if the balance falls below the minimum.
• Top-ups happen in multiples of ₹1,000 for easy management.
• Keeps your account set for daily transactions without interruption.
• Provides flexible deposit amounts and tenure to suit your needs.

ICICI Bank Auto Sweep Facility

ICICI Bank’s Money Multiplier scheme links your savings account with fixed deposits (FDs) through an automatic sweep-in and sweep-out facility. 

With the ICICI Bank Sweep-in FD, 

• Surplus balance above ₹10,000 is automatically shifted into a fixed deposit.
• Deposit period varies from 1 to 10 years with flexible choices.
• Earns the same interest as regular ICICI Bank FDs with an auto-renewal option.
• Only the required amount is withdrawn if your savings balance falls below the limit.

ICICI Bank Sweep-out FD ensures liquidity when your savings balance drops:

• Move funds from the FD whenever your savings balance becomes too low.
• Transfers occur in multiples of ₹5,000 for simple account handling.
• Use money without closing the full FD, preventing early withdrawal charges.
• Completely automated, keeping your account prepared for daily payments and emergencies.

HDFC Bank Auto Sweep Facility

HDFC Bank Sweep‑in FD (MoneyMaximizer) automatically shifts extra savings from your fixed deposit account to your savings account while keeping funds easy to access when required:

• When the balance goes above set limits (for example, ₹1,25,000 in SavingsMax, ₹1,00,000 in Women’s, ₹35,000 in Kid’s), the additional amount moves into FD.
• Minimum FD begins at ₹10,000–₹25,000 based on account, with a maximum FD limit of ₹14,99,999.
• Fully automated, no branch visit or manual FD creation required.
• Liquidity retained as linked FDs can be swept back to cover shortfalls (e.g., EMIs/cheques) in the respective bank accounts through the Sweep-out facility, keeping transactions smooth. Withdrawals use LIFO (Last-In-First-Out) when money is required.

Axis Bank Auto Sweep Facility

Axis Bank’s Encash 24 scheme links your savings account with a fixed deposit through a sweep-in and sweep-out facility.

With the Axis Bank Sweep-in FD, your surplus funds are put to work automatically:

• Surplus above ₹25,000 moves to FD in multiples of ₹5,000.
• Minimum deposit ₹5,000, tenures from 6 months to 5 years.
• Provides overdraft protection to maintain the account balance.
• Can be activated via net banking, mobile app, or branch.

The Axis Bank Sweep-out FD ensures you always have liquidity when needed:

• Automatically returns funds when the balance falls under ₹25,000.
• Applies LIFO to handle several flexi deposits.
• Removed portion gains interest for the actual period; remaining continues at FD rates.
• Allows loans up to 90% of the FD value without breaking the deposit.

Bank of India Auto Sweep Facility

Bank of India’s Star Sweep Scheme connects your savings account with fixed deposits through a sweep-in and sweep-out facility. 

Bank of India Sweep-in FD allows your savings to gain interest through automatically shifting extra balance into a fixed deposit:

• Flexible tenures: 15–179 days (SDR) or 180–364 days (DBD).
• Moves surplus above ₹1,00,000 in multiples of ₹25,000.
• Partial withdrawals are allowed via LIFO without closing the FD.
• Earns higher interest than a regular savings account.

Bank of India Sweep-out FD keeps your account liquid when your balance falls below the limit:

• Automatically releases needed funds from your FD.
• Only the right amount is withdrawn; the remainder keeps earning interest.
• No cost for reverse sweep service.
• Fully automated for convenience and easy access.

Canara Bank Auto Sweep Facility

Canara Bank Sweep-in FD links your account to a fixed deposit for higher returns:

• The balance above the prescribed limit is automatically placed into a fixed deposit (multiples of ₹5 lakh for Canara Delite accounts).
• Provided through Canara SB Power Plus savings or Canara Delite current accounts for easy, profitable savings.
• Overdraft security ensures funds are taken from the FD if your account balance is insufficient.
• Early closure of SB Power Plus accounts for less than one year incurs a ₹1,000 penalty plus service charges.

The Canara Bank Sweep-out FD keeps your account funded by auto-transferring from your fixed deposit when needed:

• Automatically transfers funds back to your account when the balance falls below the set minimum.
• Withdrawals in multiples of ₹1,000 for easy account management.
• Extra money receives better interest: 6.60% for regular customers, 7.10% for senior citizens.
• Adjustable tenure choices help deposits match your financial needs.

Central Bank of India Auto Sweep Facility

The Central Bank of India’s Auto Sweep Facility links Cent Samvridhi Savings or Current Accounts with fixed deposits through a sweep-in and sweep-out feature. 

With the Central Bank Sweep-in FD, your surplus funds are put to work automatically:

• Surplus above ₹50,000 (Savings) or ₹2,00,000 (Current) is auto-transferred to FDs.
• Transfers occur in multiples of ₹5,000 (Savings) and ₹25,000 (Current).
• Savings account FDs run for 179 days; current account FDs run 7–90 days, with auto-renewal.
• Funds earn higher FD interest while remaining accessible.

The Central Bank Sweep-out FD ensures liquidity by moving funds from your FD to your account when needed:

• Automatically transfers required funds to Savings or Current Account if the balance is low.
• Uses Last-In, First-Out (LIFO), avoiding full FD breakage.
• Avoids failed payments such as cheques or utility bills.
• Keeps FD interest rates steady, helping you gain better returns on extra balances.

Yes Bank Auto Sweep Facility

Yes Bank’s Smart Sweep option connects your savings or current account with fixed deposits, letting excess money earn more interest while keeping funds available when required.

Yes Bank Sweep in FD shifts your extra balance into fixed deposits automatically:

• Surplus from Freedom Flexi Current Account (AMB ₹25,000+) or Xtra Gain Current Account (AMB ₹25,000–₹1,00,000) is swept into FDs.
• Free cash deposits: up to 6–8× previous month’s AMB, capped at ₹25 lakh–₹2 crore.
• FD tenures: 7 days to 10 years, earning Yes Bank FD rates.
• Automatic top-up returns money from the FD if the account balance falls below the required level.

Yes Bank Sweep-out FD ensures liquidity by transferring funds from your FD to savings automatically.

• Moves funds when your account falls below the minimum balance.
• Provides cash for daily transactions or emergencies without breaking the FD.
• Combines FD interest with savings account access.
• Automated top-ups prevent failed payments or bounced cheques.

Punjab National Bank Auto Sweep Facility

Punjab National Bank’s Multi-Benefit Term Deposit Scheme links savings, current, and institutional accounts with fixed deposits through a convenient sweep-in and sweep-out facility.

Punjab National Bank Sweep in FD links your savings, current, or institutional account with a fixed deposit to put surplus funds to work:

• Available for savings, current (Smart Banking), and institutional accounts, with tenures from 7 days to 1 year.
• Surplus above ₹50,000 (savings), ₹5 lakh (current), or ₹1 lakh multiples (institutional) is swept automatically.
• Deposits in multiples of ₹5,000 (savings), ₹50,000 (current), and ₹1 lakh (institutional).
• Activate via internet banking, PNB ONE app, or branch; funds earn higher FD rates.

Punjab National Bank Sweep-out FD transfers funds from FDs to your account when needed:

• Activates if balance falls below cut-off (e.g., ₹50,000 for individuals) in multiples of ₹5,000.
• No Quarterly Average Balance (QAB) charges apply.
• Instant access to funds without FD penalties.
• FDs have flexible tenure, typically 46–179 days, earning applicable FD rates.

Bank of Baroda Auto Sweep Facility

Bank of Baroda’s Baroda Advantage Savings Facility connects your savings account to fixed deposits, providing a smooth sweep-in and sweep-out option to maximise returns while keeping liquidity.

The Bank of Baroda Sweep-in FD connects your savings account to a fixed deposit, allowing extra funds to earn better returns automatically today:

• Surplus above ₹50,000 in BOB Super Savings accounts is auto-transferred to FDs in multiples of ₹1,000.
• Available for urban/metro customers with a minimum monthly average balance of ₹20,000.
• Transferred funds receive FD interest, while the leftover balance gains the normal savings rate.
• It can be arranged through internet/mobile banking or a branch, with adjustable limit and FD period choices.

The Bank of Baroda Sweep-out FD keeps your account liquid without losing FD interest:

• Automatically transfers funds from FDs if savings balance falls below the required level (LIFO method).
• Only the needed portion of the FD is broken, avoiding full premature closure penalties.
• Ensures hassle-free liquidity while maintaining high FD interest.
• Surplus funds above the threshold are moved back to FDs to maximise returns.

Components of an Auto Sweep FD Facility

Below are the key parameters generally associated with a sweep-in-sweep-out FD facility:

Key Features and Benefits of the Auto Sweep Facility

The key benefits of a Sweep-in Sweep-out FD are:

• Higher Interest Than Savings Accounts: The funds are deposited in accounts with fixed deposit interest rates, which are higher than those of ordinary savings accounts.
• Automatic Liquidity: Money is automatically transferred between the savings account and the fixed deposit without manual transfer.
• Interest Compounding: The amount swept-in will be accrued with interest at the applicable deposit rates with any applicable compounding.
• Efficient Cash Management: This is suitable for dealing with the excess cash in the short run, which might be needed immediately.
• Hassle-Free Operation: Once this is enabled, the facility works automatically according to preset limits of balance.

How to Activate the Sweep-in Facility?

You can activate the Sweep-in or Auto Sweep facility either through online banking or by visiting your bank branch. The general process typically involves the following steps:

Online Activation 

You can use the Sweep-in facility using your bank's net banking portal and following these steps:

• Log in securely: Log in to your net banking portal with your authorised credentials.
• Navigate to the Deposits Section: You will find the section of deposits or fixed deposit in your dashboard.
• Select Sweep-in Facility: Select the option of either Sweep-in or Auto Sweep from the services offered.
• Link Accounts: Enter the details of a savings account and a fixed deposit that you want to link.
• Set Threshold Limit: Define the minimum balance threshold and transfer multiples.
• Confirm Activation: Review the information and send your request to activate the facility.

Offline Activation

If you prefer in-person assistance, you may activate the facility at your branch:

• Visit the Branch: Go to the bank branch where your savings account is maintained.
• Request Activation Form: Ask for the Sweep-in or Auto Sweep facility form.
• Provide Account Details: Fill in your savings account and fixed deposit information.
• Specify Threshold Limit: Mention the balance level at which sweep-in should occur.
• Submit Required Documents: Provide identification or other documents if required.
• Complete Verification Process: The bank will verify your details and activate the facility upon approval.

Who Should Consider Auto Sweep FDs?

Auto Sweep FDs are suitable for:

• Fluctuating Balances: Individuals with monthly incomes and expenses that are not constant can utilise the auto sweep services since the extra money will receive a higher interest rate and can be withdrawn and used to pay the regular bills.
• Business Owners: It enables the business owner, who has irregular cash flows, to optimise excess balances in the business operations. These will gain fixed deposit interest without restricting access to the funds required to satisfy working capital demands.
• Return-Focused Investors: Investors with excess liquidity in savings accounts can boost their returns by allowing excess deposits to earn fixed deposit rates instead of lower savings account interest.
• Automated Savings Seekers: Customers who want minimum manual intervention can use the auto sweep facility to automatically transfer the balances according to preset thresholds.

Taxation on Sweep-in Sweep-out FD (Auto Sweep)

The interest earned on a savings account, including one having an auto sweep facility, is taxable under the head “Income from Other Sources”. Section 80TTA allows a deduction of up to ₹10,000 for individuals and HUFs on savings account interest. Anything above this is subject to tax at the relevant income tax slab rates. Resident senior citizens can claim a deduction up to ₹50,000 under Section 80TTB on savings and fixed deposit interest combined.

The interest on the fixed deposit connected by the auto sweep facility is also subject to full taxation as income from other sources. Under Section 194A, banks deduct TDS at the rate of 10%, where the total amount of FD interest in a financial year exceeds ₹50,000 for general citizens and ₹1,00,000 in case of resident senior citizens. If PAN is not furnished, TDS is deducted at 20%. All these interests should be reported during the income tax filings.

Key Takeaways

A Sweep-in Sweep-out FD, also known as an Auto Sweep facility, links your savings/current account to a fixed deposit to help maximise returns on surplus funds while maintaining liquidity. When your balance exceeds a preset threshold, excess funds are automatically transferred into an FD and earn fixed deposit interest. If your balance falls below the limit, funds are seamlessly moved back to meet withdrawals. This facility is a combination of higher returns, flexibility, automation, and efficient cash management.