Sweep Account

A sweep account is a banking or investment account feature that automatically moves surplus funds from a checking or operational account into another account that provides higher interest earnings or investment returns. The system is designed to optimize the use of idle cash while maintaining liquidity for routine transactions. By automating transfers, sweep accounts help both individuals and businesses earn additional income without manual intervention.

Example: If a company’s current account balance exceeds a preset threshold, the excess funds are automatically transferred (“swept”) into a money market fund or short-term fixed deposit to generate interest until the funds are needed again.