Fixed deposit, saving account interest rates: Earn big through flexi bank account, here is how

There is a wide range of bank accounts for customers where they can deposit their hard-earned money and enjoy fixed interest rates on their investments. Many banks offer investment account services like savings account and fixed deposit or recurring deposit accounts to their customers.
 
However, many of us are not aware of the fact that there is another investment service, Flexi Bank Account, which comes with better options and is inter-linked with saving and fixed deposit account.
 
A flexi bank account gives you higher interest rate benefit of a fixed deposit and liquidity of a saving account or in other words, it operates as the best-of-both-worlds for customers.
 
Through a flexi bank account, you can set up a limit on your savings account, based on regular cash needs, and can also transfer any excess money to the fixed deposit account for higher interest rates.
 
There are two types of flexi bank accounts: Fixed Deposit Sweep-in facility and Flexi Deposit. If you plan to make investment in this bank account, you should know what these two flexi bank accounts are.
 
Fixed deposit sweep-in
 
This one is offered as an option by banks to savings account holders. The sweep facility is a kind of fixed deposit, and it is linked to your savings account or current account depending on which account you hold with the bank.
 
Sweep-facility varies from bank to bank. Some may offer you the facility to open a savings bank account and link the same to your fixed deposits, while some provides the facility based on the overdrafts taken by a customer.
 
According to BankBazaar, any individual who runs a small business and has a current account need not take an overdraft on the fixed deposit held by them, setting up a sweep account will be more beneficial for them.
 
One needs to remember that for having this facility, a customer will have to open a fixed deposit of at least Rs 25,000, or alternatively he/she could open a premium account, wherein, the minimum balance on either a monthly or quarterly basis is in the range of Rs 25,000 - Rs 1,00,000.
 
Flexi Fixed Deposits
 
Traditionally this one is a combination of a fixed deposit and a recurring/savings account, ensuring customers for availing benefits of high interest rates offered by fixed deposits plus liquidity offered by saving accounts.
 
According to BankBazaar, the benefits of flexi fixed deposits earn higher interests compared to savings accounts, enabling one to earn more through their money. Different banks have different tenures for the flexi deposit schemes, ensuring one finds a tenure which best suits his/her financial needs.
 
Since opening a flexi fixed deposit account is simple and hassle free, with most banks following a fast and transparent process, banks generally allow auto renewal of flexi FDs, ensuring account holders don’t have to worry about renewal.
 
Are these two accounts different?
 
By using sweep-in facility, any excess amount gets swept into fixed deposits automatically. Whether the amount be Rs 1 or above the threshold limit. This eliminates the procedure of opening a new fixed deposits account for this purpose.
 
Whereas, flexi deposit follows a manual process which requires a customer to book a fixed deposit and then link the same with savings or current account.
 
According BankBazaar, for more convenient and easy method to keep your surplus funds in a facility earning you need a better interest rather that manually book it like in a flexi deposit, you can use the Sweep In facility.
 
"With this facility there are no charges. penalties, or even fees for breaking the fixed deposit, you only lose interest rate on the amount taken out of the Sweep In account," it added.