FDIC insurance has been a hot topic over the last several months, with many consumers working more closely with their banking and financial partners to evaluate their opportunities to maximize coverage on their funds. Some individuals and families may need to look beyond the more common ways to expand FDIC insurance coverage. That’s where insured cash sweep accounts come in. In this article, we’ll take a look at what an insured cash sweep account is and elements you may want to know about this unique product.
What is an Insured Cash Sweep?
An Insured Cash Sweep account gives you access to FDIC insurance on deposit balances exceeding $250,000 through partnerships between your bank and hundreds of others across the country. These accounts earn interest and are available for both personal banking and business accounts.
How do Insured Cash Sweeps work?
All funds within an Insured Cash Sweep can be 100% FDIC insured up to $150 million. Through a partnership between the product provider, your bank, and hundreds of other banks throughout the country, your funds are placed in an account at your financial institution. Each night, your funds are “swept” in $250,000 increments into other FDIC-insured banks that participate in the same product network. Insured Cash Sweep gives you the ability to maintain full same-day access to all of your funds, while working directly with your primary bank.
Why use an Insured Cash Sweep?
An Insured Cash Sweep can give you peace of mind knowing your funds have full FDIC insurance. Along with being fully insured, the ability to work with only one bank, and the fully liquid, same-day convenience factor is also a significant benefit. Finally, Insured Cash Sweeps are interest-earning accounts, so you can still benefit from a competitive interest rate on your funds.
To learn more about this exclusive service, talk to one of our private bankers or Treasury sales officers today.