Sweep Account

These are Hybrid Savings Bank accounts that are being provided by public as well as private bank , they are being offered for some time now

How do these account work:
Most of the banks have a pre defined amount say Rs.10,000 as the limit .Any amount above this would be automatically be swept into a FD, mostly in multiples of Rs.1000. You can even chose the durations of these FD (Fixed Deposits )

Let us say you have Rs.30,000 in you account, that would mean Rs.10,000 in saving account and Rs.20000 as 20 FD of Rs.1000 each , In case you issue a cheque of Rs.11,000, then one of those FDs would be encashed and used to honour your cheque.


Advantage :
The advantage of such an account would be , your money starts to work a bit harder , instead of Savings Bank interest rate , you money starts earning higher interest rate of an FD

Most of the Pubic sector bank have lower limit for the swap to be triggered compared to the private sector banks .

Corporation Bank : http://www.corpbank.com/asp/0100text.asp?presentID=1355&headID=19


SBI : http://www.sbi.co.in//viewsection.jsp?id=0,1,19,113,185

These are just a few , would recommend that you , always try to open a sweep account instead of a normal savings bank account