Does interest accumulate daily in a bank?

Question

i have a checking account with a 5% interest rate. yeah i know that's insane! if its like every other account does it accumulate daily, weekly, monthly???

Answer 1

My savings accounts I can choose to collect interest monthly or yearly. I choose monthly as I need to watch my savings constantly grow in order to stop myself spending the money on rubbish! The yearly interest rate is slightly higher, but I would get bored too quickly and waste it all! I don't think it is worked out daily though.

Answer 2

Different banks compute interest differently.  That is why APR is so important.  It is the way you can accurately compare one bank's yield to another.

The paper work you got when you opened the account will tell you how they compound interest.