Two in one account is benefited to customer by providing a Term deposit linked with SB account .The amount in excess to a particular limit in an SB account is automatically transferred to term deposited for a particular period. By default the period is one year. This kind of auto transfer is called auto sweep. Term deposit created through auto sweep carries a higher interest rate than SB Account and all other terms of interest payment and premature withdrawals are applicable on the day of auto sweep.
Now let us see the real benefit. If your savings account failed to meet a debit transaction; the term deposit automatically break up to the amount of shortfall in multiple of 1000/- and the transaction honored automatically. This process is called reverse sweep. Last created term deposit break first to get the maximum benefit to the customer. These processes are system driven and no manual effort is required. When a term deposit matured will be renewed automatically for a default period or a longer period as per customer intention.
Most of the banks are not promoting this kind of accounts as lower interest rated SB Accounts are reducing. Also bank will have to pay more interest. As a result most banks are not providing auto sweep facility but continued reverse sweep.
