Daily Bank Savings Interest

RacingDriver

If a bank says that it calculates savings interest daily is this done

a) Using the balance at the end of each day (midnight)

b) OR Using the average balance throughout the day

c) OR Other?

Also do all banks do it the same way?

Flobberchops

I would assume closing balance at the end of business that day, so closest to a).

eskbanker

My understanding is that each bank has its own definition of close of business and so they're not all the same. I'm pretty sure I've read on here about people who've tried to be smart and shifted funds around in real time to meet multiple cut-off times with the same money, but this would be frowned on to say the least....

G_M

eskbanker wrote: »

My understanding is that each bank has its own definition of close of business and so they're not all the same. I'm pretty sure I've read on here about people who've tried to be smart and shifted funds around in real time to meet multiple cut-off times with the same money, but this would be frowned on to say the least....

I did that for a while back in the bad old days when BACS took 3 (or was it 5?) working days.

Some banks continued to pay interest on money leaving till the end of the period, while some receiving banks paid from the date of transfer....

Ah! Life was good!

moneyfoolish

Can anybody answer the following similar question on this topic, please?
I have several current accounts all of which I input the required monthly payment amount from 1 main account. That means on several different days each month that I transfer amounts varying between £500 and £1500 from my main account to other current accounts each of which transfers the same amount back to the main account on the same day. I am correct in saying that in this case no interest would be lost on any of the accounts as all transactions between any 2 accounts are made on the same day?

YorkshireBoy

moneyfoolish wrote: »

Can anybody answer the following similar question on this topic, please?
I have several current accounts all of which I input the required monthly payment amount from 1 main account. That means on several different days each month that I transfer amounts varying between £500 and £1500 from my main account to other current accounts each of which transfers the same amount back to the main account on the same day. I am correct in saying that in this case no interest would be lost on any of the accounts as all transactions between any 2 accounts are made on the same day?

Best to avoid evenings, so make them before 8pm as at least one bank has an 8pm ish cut-off (can't remember which one). Santander is 9 ish and Lloyds is 10pm I believe.

I'm sure one of those exploiting this will correct me if I have the above wrong.

ceredigion

YorkshireBoy wrote: »

(can't remember which one)

Barclays:
Santander is 8.20pm ish

moneyfoolish

YorkshireBoy wrote: »

Best to avoid evenings, so make them before 8pm as at least one bank has an 8pm ish cut-off (can't remember which one). Santander is 9 ish and Lloyds is 10pm I believe.

I'm sure one of those exploiting this will correct me if I have the above wrong.

Mine are all done automatically via standing orders.

YorkshireBoy

moneyfoolish wrote: »

Mine are all done automatically via standing orders.

If you'd put that in your first post my answer would have been a much shorter 'yes'.

The only one to be wary of is Tesco, as they're the only bank which sends SOs on non-working days (akin to a future dated FP?). All the others delay until the next working day.