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The gross interest rate on this account is 2.96% - this is the figure that you need to use.

Rather than simply dividing by 12, you will need to divide by 365*, and multiply by the number of days in the month.

* Note - it is possible that you would need to divide by 366 rather than 365 for the days in 2012, as that was a leap year. It depends on how Santander's system treats leap years.

An initial step would be to check that the 'average' balance given on your statement is indeed calculated correctly. Feel free to post (an edited copy of) your statement on here (or PM) if you want a hand with the calculation or want a second pair of eyes to check that what you have done is correct.

Also consider - did you pay in any cheques during the month? This could affect the interest paid.

For a different reason, I was under-paid interest by Santander last year. Am happy to help you to discover whether you have been too.

Originally posted by **rb10**
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Thanks for the above.

Firstly in the T&Cs Santander use 365 days and 366 in a leap year.

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8.3 For the purpose of calculating interest we work on the basis that there are 365 days in a year, unless it is a leap year where interest is calculated on a 366 day basis.

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Next taking the period from 15th Nov to 15 Dec 2012 Santander give an amount of £6000.81 on my statement as the average credit balance.

During that period the balance did not drop below £4,000 or exceed £10,000 and I did not pay any cheques into my account.

Taking that figure of £6,000.81 the calculation should be:

£6,000.81 x 0.0296 / 366 x 30 =

**£14.56**. As stated above I was paid

**£13.72 **interest

The Statement to 15 Jan gave an average credit balance of £13,994.85.

However on a few days I exceed the £20,000 by a small amount - well under £100 and for no more than 1 day. The balance didn't drop below £7,000 and again no cheques paid into my account.

The same calculation (£13,994.85 x 0.0296 /366 x 31) =

**£35.09. **I was paid

**£32.70**.

Even if you reduced the average balance by £100 to account for exceeding £20k(and it would not be that much) the figure for interest due would be £34.84.

As for checking Santander's average credit balance, why would they give that statistic if it were not the basis for

**their** interest calculation?

Thoughts?