The frequency of interest payments, or the level of compounding interest, on any bank account is determined by the bank and the type of account you have. Truth in savings regulation makes it so the bank has to inform that account holder what the APY is on the account. The APY is the annual rate of interest paid on the account by factoring in how often the interest is paid or compounded on the account. Some banks pay interest daily, others monthly, and some certificates of deposit pay interest only when the certificate matures.

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