Auto-Sweep Deposits Explained: Savings Accounts That Convert to FDs

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Auto-Sweep Deposits: Your Savings Account Can Earn FD Interest Automatically

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M

Moneycontrol•12-03-2026, 18:17

Auto-Sweep Deposits: Your Savings Account Can Earn FD Interest Automatically

•Auto-sweep facility automatically moves excess savings account balance into a Fixed Deposit (FD).
•Banks set a threshold; funds above this limit are transferred to an FD, earning higher interest.
•When you withdraw, a 'reverse sweep' automatically brings money back from the FD to cover the deficit.
•Banks promote auto-sweep to help customers earn better returns on idle funds compared to standard savings rates.
•Interest rates may vary if FDs are broken early; it's not a perfect FD substitute, often linked to shorter-term rates.

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