Korkojakso

Korkojakso is a Finnish financial term describing the interval at which interest is calculated and applied to a balance. It is the period between two interest postings, or the frequency with which interest accrues and is added to principal. The term derives from korko (interest) and jakso (period). The specific meaning can vary by contract and by financial product; some agreements may use the term interchangeably with compounding period or interest-credited period.

In practice, korkojakso determines the rate used in each calculation: for example, a product with a nominal annual rate of 6% and a monthly korkojakso applies a periodic rate of 0.5% per month, and interest is added to the balance each month. More frequent korkojakso can lead to a higher effective annual rate even if the nominal rate stays the same, due to compound interest.

Korkojakso is particularly relevant for loans, mortgages, savings accounts, and other instruments where interest is periodically capitalized. It interacts with the nominal rate, compounding method (simple vs. compound), and any grace or payment schedules set in the contract.

Because terms vary, customers should verify the korkojakso in their agreement, understand how it affects the annual percentage rate (APR), and check whether changes in the korkojakso can occur during the term.