A trader pays interest on the currency position they sell and they collect interest on the currency position they buy.

The interest payments happen in the trading market on every trading day.  Theoretically, all the positions are closed at the end of the day in a spot market – The trader does not see it happening when they hold a position to the next day.

Broker sites open and reopen your position and they debit or credit the overnight interest rate variation between the two currencies in the pair.  This is known as the cost of carrying the position to the next day.  The money that is debited or credited for holding a position overnight is known as interest rate carry.