A bank account set up to operate so that at the end of each banking day all or a portion of the funds on deposit in the account are automatically transferred ("swept") into another account. Companies use sweep accounts alongside their other bank accounts as part of their cash management (or treasury management) system. Sweep accounts ensure that a company's spare cash on deposit is concentrated into a small number of bank accounts (sometimes a single account).

In some cases, companies use sweep accounts to ensure that payments the company has made that have not yet been processed at the bank will clear. If the company's cash reserves are held in many accounts, there may not be enough funds in any single account to cover a payment from that account. The company could monitor its account balances closely and transfer funds manually to cover individual payments, but with a sweep account transfers are made automatically, which reduces the administrative burden on the company.

Companies also use sweep accounts to ensure that funds that remain in non-interest-bearing accounts at the end of each day are transferred into interest-bearing accounts for overnight deposit. This allows the company to maximize the earnings on its cash reserves. Funds can then be transferred back to non-interest-bearing accounts whenever necessary to facilitate payment clearing.