What is interest on cash?

This is any cash that you have not invested in instruments like stocks and ETFs. Check how much of your cash is not invested in the Interest on cash dashboard in the Menu 👇

1. Tap ☰
2. Select Interest on cash
3. Check the total interest earned for each currency under Your earnings

It is held either in banks or in qualifying money market funds (QMMFs), depending on the account type.

For Trading 212 AU Pty Ltd clients, funds are held only in banks. Any further QMMF information does not apply.

For SIPP accounts, cash is held only in banks, using regular bank deposits and/or term deposits. It is not held in QMMFs, so the QMMF information below does not apply to SIPP cash. See clause 5.7 of the SIPP Terms.

You can earn interest on cash held in any of the following account types:

• Stocks & Shares ISA
• Cash ISA
• Invest
• SIPP
• CFD

The rates displayed on our website (see Terms & Fees) apply to new clients. If you already have an existing account, you can find your applicable rate in the Interest tab of your app.

No.

Login to your account, tap on Interest on cash, follow the instructions and tap the ‘Enable’ button. For accounts where cash may be held in qualifying money market funds (QMMFs), you will also need to consent to this. 

 

You can disable it at any time via the ‘Interest on cash’ dashboard in your app.

You can turn the interest back on at any time. 

We use a mixture of products and vehicles, such as qualifying money market funds, time deposits, and current accounts. For Trading 212 AU accounts, time deposits and current accounts with banks are used.

 

A qualifying money market fund holds mainly short-term, low-risk financial assets, aiming to maintain a stable value. These funds are designed to be low-risk places to keep your cash while earning a bit of interest, and they're often used for the cash portion of retirement or investment accounts. They're called "qualifying" because they meet certain regulations that allow them to be considered cash equivalents.

Pension funds, insurance funds, banks, and other major financial institutions.
These institutions typically use QMMFs to hold large amounts of money. 

Interest payments are calculated using the industry standard AER (or APY) formula:

(1+r/n)^n - 1, where

* r = interest rate
* n = compounding frequency (365.25 days)

We use 365.25 days to account for leap years.

Interest payments are made daily, rounded down to the nearest cent. Amounts below 0.01 are carried forward.

If the daily interest falls below 0.01, it will accumulate until reaching 0.01 or more, at which point it will be paid.

This depends on your tax residency. For more information, check 👉 here.

If you are a client of Trading 212 AU PTY LTD, you should check out this article about taxation.  

In the app, tap on Interest on cash, and you’ll find which currencies earn interest. You can also find them on our terms and fees page.

Where we hold your money with a bank, clients of Trading 212 UK Ltd are protected by the FSCS up to a limit of £120,000 per eligible person, per banking licence, if the bank fails and the deposit is eligible. Clients of Trading 212 Markets Ltd are protected by the ICF up to a limit of €20,000. Learn more about how your money is protected here.

This £120,000 deposit protection also applies to eligible cash held in your SIPP with UK-authorised partner banks. The limit includes your other eligible deposits with banks sharing the same licence, whether held through Trading 212, another provider or directly; it is not a separate limit for each account.

Money placed with a QMMF is treated as an investment and not as money held with a bank. In the unlikely event that the QMMF fails to maintain their low-risk strategy, as with any investment, the protection will not be available. We carefully select all QMMFs to ensure that they are highly liquid, stable in value and maintain their highly regulated status.

 

If a QMMF in which your cash is invested goes down in value, this may affect the value of your uninvested cash held in the QMMF. However, to manage this risk, we select only high-quality QMMFs, and we monitor them frequently. Learn more about the risks of QMMFs and how we manage them 👉 here.

 

You can see your cash holdings in QMMFs and banks through the app's 'Interest on cash' dashboard and in the 'Cash in banks' and 'Cash in QMMFs' sections of your account activity and monthly statements.

 

Interest rates are based on rates we receive from the banks and QMMFs we hold your cash with. These rates are based on the central banks' rates, like the Bank of England's base rate. If the central bank rate changes, you can expect a change in the interest on cash.

Cash ISA, Stocks ISA, and CFD accounts

• Interest is paid directly into your account balance.

Invest account

• Interest is credited into your account balance in the Main Pot.

Interest is paid into the Trading 212 account where it is earned.