The DWP will charge interest on the SMI loans that you have borrowed. This will build up daily and will be added to the total at the end of each month. The interest is compound, ie it will be based on the total amount of SMI loans plus any earlier interest that has already been added to that total. The interest will continue to build up until you have paid off the SMI loans (and interest) in full.

The interest rate can be revised twice a year, with any changes being made on the 1 January or 1 July. 1LMIR Regs, reg 15