NCBA Bank clients with more than one account will now be subject to an auto sweep feature if they take loans with the bank. Auto sweep is a banking feature that automatically transfers funds from an account to a linked account.
If your primary account is low on funds for your loan repayment, the tier 1 bank will automatically transfer money from your other linked accounts to cover it. Customers with loans from the bank are at risk of finding themselves without funds if their other accounts are “swept” to repay a loan.
“by allowing the bank to automatically collect the amount due from any alternative accounts you hold with us if your primary loan repayment account does not have sufficient funds on the due date,” reads the bank’s notice to clients.
For the auto sweep to happen, NCBA Bank clients don’t have to do anything. The bank will automatically transfer money from clients’ other accounts when the repayment period lapses. The bank states that this will allow its customers to easily pay loans and avoid defaulting.
Some account types are however exempted from the auto sweep feature. According to the bank’s FAQs, “The feature will apply to any funded accounts under the same customer base number you have with the bank, including savings, current, but will exempt fixed deposit and junior savings accounts.”
The bank says it is “exercising its right of set-off as embedded in the loan contract arrangement Terms and Conditions“. A benefit of this is that if you have funds in other accounts, you’ll avoid late payment charges.
