Tembo Cash ISA - do I lose a couple of days interest on the amount I pay in each time I do it?

OrangeBlueGreen

Hi everyone

Can somebody help me understand something with Tembo please?

So they don't use sort code or account number, so we have to pull the money in through their app. These payments take 1-2 working days to clear, does this mean I lose the interest on that amount for a couple of days (or potentially 4 days if I make payment in on a Friday).

I tried to ask their AI chat, but it's not really helping and there's some information that's even more confusing when it mentions "up to 24 working hours". I'm guessing they just mean normal hours as in working hours that would be 4-5 days.

Also, just to understand things more, why would a provider choose not to use the normal sort code/account system? Is it a cost-cutting measure or is it something else?

Many thanks :-)

masonic

It is not uncommon for there to be a delay before interest is earned when using an aggregator service like Tembo, so it's certainly possible. But clearance can also refer to when the money becomes available to withdraw, which can be after it has started earning interest. What do the T&C say?

Many savings providers do not provide individual sort code/account for each customer. It is because they are not banks and therefore run their services through a central clearing account. Running through Open Banking avoids issues where you need customers to enter a reference number and they fail to do so correctly. Such issues are often an ongoing administrative burden as monies have to be manually matched or returned to the sender.