June 4, 2012 4:17 pm
I have savings account with HDFC bank. I came to know sweep-in facility to earn more interest on the money lying idle in the account.
Can someone give explain with example how it works? How will I get benefitted?
Dear Banyan sir
I have accounts in IDBI, ING Vysya and SBI.
Can anybody guide me , if any of these Banks offer Auto Sweep-In facility.
Unless HDFC have changed their policy, the sweep-in policy is not seamless. At the time of opening the FD, you would have to instruct the bank to link it to your Saving bank. It wasn’t doing the automatic sweep-in which you are after.
Sweep in facility in saving bank account is basically automatic transfer of your surplus funds in your saving account and booking up of FD in order to allow the account holder to earn more interest. This transfer happens when the balance in saving account is over a threshold balance. For example, if you have a saving balance of 1 lac and the threshold is 25K, the bank would automatically book a FD of 75K and your saving balance would reduce to 25K. Once your saving balance reduces below 10K, the bank would break some of your FD of 75K and transfer it to your saving balance. This whole process is automatic requiring no involvement of the account holder.
in HDFC BANK, sweep in facility , is breaking your linked fd for exact(nearest to rs.1) shortfall for any transaction(withdrawal cheque realization , transfer through net etc.) in the linked saving a/c , so your remaining fd a/m continues earning the interest as earlier). however the interest earned on redeemed fd a/m as applicable would be credited in your s/b account. you have to be careful to top your saving account for monthly minimum balance, in case such sweep in occurs. you can linked more than one fd with your saving a/c for such sweep in.and if i am not mistaking, the saving account should be in individual name for opening such fds online.
Dear Ramprasad, please check with your bank (HDFC) for the exact details applicable there. In general, the sweep in facility allows you to earn interest more than the SB rate for the amount lying idle in your SB account if it’s over a cut off limit say 10K or 25K or 50K depending upon the bank you are transacting with.
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