Zopa savings interest

guli

eskbanker said:

slinger2 said:

It's not an easy calculation but you can get a ballpark number using the daily interest rate and the daily balances (in your case 20 April to 19 May). For instance 5.08% AER = 4.96% Gross = 0.01359% per day. Suppose you had a £200 balance for the first 20 days, £100 balance for 5 days and £1000 balance for the last 5 days. The interest would be (roughly) = (200*20+100*5+1000*5)*0.01359% = £1.29. This ignores compounding during the month and any rounding that Zopa might do.

There isn't any compounding during the month!

why not? interest is calculated daily

ColdIron

guli said:

eskbanker said:

slinger2 said:

It's not an easy calculation but you can get a ballpark number using the daily interest rate and the daily balances (in your case 20 April to 19 May). For instance 5.08% AER = 4.96% Gross = 0.01359% per day. Suppose you had a £200 balance for the first 20 days, £100 balance for 5 days and £1000 balance for the last 5 days. The interest would be (roughly) = (200*20+100*5+1000*5)*0.01359% = £1.29. This ignores compounding during the month and any rounding that Zopa might do.

There isn't any compounding during the month!

why not? interest is calculated daily

But not paid daily. Compounding only happens once the interest is paid

MichaelAP

Chip do the same with their Instant Access account.
Each day you receive a ‘Pending’ amount of the days interest. This ‘Pending’ amount will be the same amount each day. However, like ColdIron states that interest is only paid after the month ends (Chip wait 4 days before paying the previous months interest).
Once interest is paid the new daily ‘Pending’ amount will have slightly increased as it is now using the compounded amount from the latest interest+the amount in the account.