Natick-based Middlesex Savings Bank offers a well-established sweep account product that has proven popular with customers.

Although most banks close at 5 p.m., their work doesn’t stop then. Business and some consumer customers are making money even when their bank is closed. Sweep accounts, which have existed for years, are starting to be utilized more often as interest rates head back up.

According to American Banker’s Web site, a sweep account is defined as a deposit account that periodically removes a portion of the customer’s funds into a higher yielding instrument, like a money market account. The frequency of the transfer of money varies.

Pamela J. Montpelier, president and chief executive officer of Franklin-based Strata Bank, said the bank has offered business sweep accounts for more than five years.

“For any business, it is a very effective tool,” Montpelier said. “They [businesses] don’t spend enough time saying, ‘How can I earn interest?'”

Montpelier added that she introduced the accounts after noticing customers were leaving too much money in their checking accounts.

Sweep accounts offer customers a way for their money to work for them. At Strata Bank, customers can sweep cash from their checking account to a money market account each day. If the customer needs to access money for checking account needs, the funds are swept back into the checking account. The system is entirely automated. Other customers choose to have a target balance in their checking account. If the balance tips over the target balance, the excess funds are swept into the money market account to be invested.

‘Pretty Popular’

Middlesex Savings Bank in Natick also has a well-established sweep account product. Jim McIver, manager of the Cash Management Division at Middlesex, said most customers enjoy the convenience that the account offers.

“It is a pretty popular product, in general,” McIver said. “It puts idle funds to work overnight.”

The luxury of having the bank move funds each night comes with a cost. McIver estimated that monthly maintenance fees range from $100 to $150 depending on the bank.

The accounts are strong revenue generators because there is a good spread between what the bank is paying in interest to the customer and the investment the bank can make with the funds. Customers also are more likely to keep larger balances in those accounts in order to earn more interest. That allows banks to invest more, as well.

Currently, the rate at Middlesex is 2.10 percent. Two years ago, the rate was 0.55 percent and remained there for six to eight months.

While most banks aren’t hiding their sweep accounts, few actively advertise them. McIver said customers who use the accounts typically know about them when they walk in the door.

“It is a product that customers know that they want it,” McIver said, adding that large and mid-tier companies are the average users.

Middlesex currently has 51 businesses using sweep accounts. The amount of cash being swept has increased in one year, McIver said. Between 2004 and 2005, the amount of money swept on a daily basis has increased from approximately $30 million to $38 million.

Although sweep account popularity fluctuates with the interest rate market, Montpelier said if a piece of federal legislation is approved, there may not be a huge demand for sweep accounts.

According to the American Bankers Association, the House Financial Services Committee, in April, approved the Business Checking Freedom Act, which eliminates the prohibition that has prevented banks from paying interest on corporate checking accounts.

While the majority of banks only offer sweep accounts to business customers, Boston-based Wainwright Bank also gives consumers the chance to maximize their investments. Steve Young, spokesman for the bank, said although the bank pays out more in interest with the sweep accounts, they also give the bank a means to “secure” a relationship with a customer that could lead to future business.

Like Middlesex Savings customers, most of Wainwright Bank’s customers who have sweep accounts are financially savvy.

“We provide them mostly upon request,” Young said.

The bank offers two different types of sweep accounts: a regular money market sweep account and a high-yield money market sweep account. The high-yield account requires customers to have an average daily balance of $25,000.

The Bank of Western Massachusetts, an affiliate of Vermont-based Chittenden Corp., offers sweep accounts as a core commercial product. Bill Burke, vice president and manager of the cash management sales division at Chittenden Bank, another affiliate of Chittenden Corp., said customers especially enjoy the convenience of automation with sweep accounts.

“They can spend their time on other priorities,” said Burke.

Burke said sweep accounts are an intriguing product because customers could use it as their one way to invest.

“Sweep accounts are interesting because they could be a client’s primary investment vehicle,” said Burke.

While some customers may not use it as their only means of investment, there is a clear reason for using a sweep account.

“The goal is to maximize investable cash,” said Burke.

Although Burke could not speak specifically on The Bank of Western Massachusetts’ sweep account rates because that market is different than Vermont’s, he said the banks change the rates fairly often. The banks will typically look at what the competition is offering and try to set an attractive rate. However, Burke said the banks strive to give customers a valuable service.

“There is a value we try to achieve between the rate and the fee associated with it,” Burke said, adding that the automated system frees up businesses’ time. “It all has to blend into the value statement.”

Even with all its benefits, sweep accounts may not be the ideal product for everyone.

“If a company is looking to absolutely maximize their investable balance, sweep accounts may not be the first choice,” Burke said.

Other accounts may offer a higher rate, although not the liquidity that sweep accounts do.

Meanwhile, some companies may want to push the envelope by using a higher rate investment account, as well as sweep accounts for late-day transactions.

“[Making] sure nothing goes uninvested,” Burke said.