What an FDIC sweep network does with your cash
Why a single bank insures $250,000 and how sweep networks cover balances up to $5M.
Banking
Samuel Ortiz, Guest author
7 min read
FDIC insurance covers up to $250,000 per depositor, per insured bank, per ownership category. A company holding $2M at one bank has $1.75M uninsured.
What a sweep does
A sweep network places slices of your balance at several program banks, each slice under the limit. Your statement still shows one balance, and the money moves back automatically when you need it.
What to ask any provider
Which bank holds the deposits, how many program banks are in the network, and whether you can opt a bank out. You should get a straight answer to all three.
Apply in about 10 minutes with your EIN and a photo ID. Most companies are approved within one business day, and Essential has no monthly fee.