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Definition
A sweep account automatically moves surplus cash between accounts — typically sweeping idle balances into an interest-bearing or debt-reducing account overnight, and back when needed. It puts otherwise-idle working cash to work without manual intervention.
In plain terms
At the end of each day, cash above a set threshold is swept where it earns interest or pays down borrowing; if the main account runs short, funds are swept back. It squeezes value from cash that would otherwise sit still.
Why it matters
Sweeping is a treasury technique for making the most of a fluctuating cash position. See notional pooling and cash position.
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