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Difference Between a Regular Fixed Deposit Account and a Sweep-in Fixed Deposit Account

 A Fixed Deposit account is one of the safest investment options. It allows you to keep an amount in the bank on which you’ll receive interest at the end of the tenure along with the invested sum.
 
A sweep-in account is a service offered to Fixed Deposit account holders. The account holder gets to decide a minimum amount that stays in the savings account. Any excess sum gets transferred to the Fixed Deposit account, and whenever cash is needed, the bank just ‘sweeps’ in funds to the savings account.

Let’s get to know a little more about a Fixed Deposit account.
 
Fixed Deposit Account: Tenure, Interest Rates, and Eligibility
 
The tenure of a Fixed Deposit account ranges from 7 days to 20 years. Every bank has its own set of rules and regulations when it comes to opening a Fixed Deposit account. To know how Fixed Deposit interest rates offered by banks work, you’ll need to use the Fixed Deposit calculator that’s available on every bank’s website.

This will give you a fair understanding of the interest you’ll be making at the maturity of the account.
The more number of years to opt for maintaining a Fixed Deposit, the more interest you’ll be making.
 
Before you apply for a Fixed Deposit account you may want to check if you’re eligible.
Only the below individuals can apply:
 
  • Resident Individuals
  • Hindu Undivided Family (HUF)
  • Sole Proprietorship
  • Partnership Firms
  • Companies including group companies
  • Club, Association, and Society
  • Family Trust
All you have to do is provide your identity proof and address proof to the bank in order to open the bank. Usually, you must have a sum of Rs. 10,000 to start a Fixed Deposit account.

Why Should you Opt for a Sweep-in Account?
If you’ve got excess cash sweep-ins are the best facility to go for. You need to have a savings and Fixed Deposit account to avail this facility. 
 
All you need to do is set a limit that stays in your savings account. The bank or NBFC then takes care of any excess amount in your savings account by transferring it to your Fixed Deposit account. What’s more! You also receive interest on that amount. If you need to use more than the amount in your savings account then it will be recovered from your FD account.

For example, you have deposited Rs. 10,000 in your savings account and the minimum limit is Rs. 5,000. The excess Rs. 5,000 will get deposited to your FD account and you’ll receive an interest on it. If you make a payment of Rs. 6,000 from your savings account the remaining Rs. 1,000 will be taken from your FD account.
If you opt for a regular FD account you won’t be able to avail sweep-in benefits. Sweep-in accounts are more user-friendly and everything will be managed by the bank or NBFC while you can sit back and enjoy the benefits and services. 

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