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Changing interest payment frequency on a RCI Fixed Rate Bond from Annual to Monthly.

Speculator
Speculator Posts: 2,384 Forumite
Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
edited 8 December 2022 at 2:28AM in Savings & investments
I am half way through a 5 year fixed rate bond paying 1.9% annual interest with RCI.

It is currently paying annual interest (credited to the bond) and the next payment is due 29 April 2023.

I noticed there is an option to change the interest frequency from Annual to Monthly interest and there's even an option to have the interest paid to my nominated current account. 

Therefore, instead of compounding the interest annually at 1.9%, I can transfer it monthly to my 2.75% Santander and then to my 7% First Direct.

Does anyone know what would normally happen to the annual interest (from 29/4/22 to 8/12/22) earned up to the date of the change? Would it be added onto the bond at the next annual payment date (29/4/23) or would it be paid to my nominated a/c at the next monthly payment date?



 
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