Interest can be interesting!

At BankMobile we are proud to offer competitive APY and interest rates with the Bankmobile Vibe checking account featured in this video.
More importantly, read below to learn about the difference and how BankMobile’s APY and interest rates positively affect your checking account!

APY Definition & Example

APY = Annual Percentage Yield. In plain English, APY indicates how much your money will earn throughout a period of one year. Here is a simple and straightforward example to make it easy to understand:

Step 1

Tom just opened a BankMobile Vibe Checking Account! He puts $1,000 into his account and does not plan to touch it for one year.

Step 2

Since his balance is $1,000, he falls into the first tier of a 3.00% APY. 3.00% of $1,000 is $30, so at the end of the year Tom’s account balance will be $1,030.

Step 3

. Tom is getting $30 for simply letting his money sit in his account, that’s more than he would get at most banks!

Interest Rate Definition & Example

Interest rate is the percentage of an amount of money that is charged to the borrowing party for borrowing this money. The main difference between APY and interest rates is that an interest rate contributes to and results in the APY. Interest is calculated periodically and therefore money is earned periodically.

 

A simple calculation formula based on interest rate would be: A = P(I + rt) Where A = Total Accrued Amount (principal + interest), P = Principal Amount, I = Interest Amount, r = Rate of Interest per year in decimal; r = R/100, and t = Time Period involved in months or years. A simple online calculator found at financialcalculators.org can help you as well in looking at your own financial interest rate for your BankMobile checking account.

 

In plain English, here is a great example:

Easy-to-Understand Steps

Step 1

Tom has an opening balance of $1,000 and he earns $1.00 in interest. His balance is now $1,001.

Step 2

The next time interest is calculated, it is calculated using the new balance of $1,001, not the principle amount of $1,000.

Step 3

At the end of the year, assuming Tom does not withdraw or deposit and he gets an APY of 3.00%, this process will repeat until Tom's ending balance is $1,030.

  Tier 1 – Average Daily Balances Up To $1,000 Tier 2 – Average Daily Balances Greater Than $1,000**
APY 3.00% 3.00% to 0.12%
Interest 2.96% 0.01%
  Tier 1 – Average Daily Balances Up To $1,000 Tier 2 – Average Daily Balances Greater Than $1,000 And Up To $15,000 Tier 3 – Average Daily Balances Greater Than $15,000**
APY 3.00% 3.00% to 2.06% 2.06% to 0.28%
Interest 2.96% 1.98% 0.01%

 

*An enrolled account holder is enrolled in a university.

**A maximum average daily balance of $115,000.000 is assumed to calculate this tier annual percentage yield range.

***An unenrolled account holder is no longer enrolled in a university

 

FAQs

How can I calculate my interest rate?

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How do I determine my checking account balance tier?

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Where do I find my interest earned per statement cycle?

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Do interest rates and APY change?

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Who do I contact if I have a question on my interest rate?

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