What does it mean when you show my simple interest rates with a compound equivalent?
We use a simple interest rate to work out how much interest you’ll be charged each month. We've started showing you these rates on your statements and in communications as the Bank of England Base Rate is also a simple rate. That way you can see exactly how your standard and cash interest will change if the Base Rate changes.
The compound equivalent rates you see are comparable to the standard and cash rates you’ll have seen before 1 February 2016 – we’re just showing them differently. These rates take into account any interest you’ll be charged on interest if you don’t pay your balance in full each month.
We haven’t changed the way we charge interest, we have just changed how we show your interest rates.