Forget The ‘Big Four’: These Banks All Have Better Interest Rates

Bigger isn’t always better. Just as indie films are often more entertaining than Hollywood blockbusters, challenger lenders often provide better value than big banks.

For proof, take savings accounts and term deposits, where a raft of small banks and credit unions provide more generous interest rates than ANZ, CBA, NAB and Westpac.

Imagine you had $5000 to invest in a savings account. The maximum ongoing rate you could get from a big four bank would be 2.40% with ANZ and NAB.

Lender Product Base rate Max. rate How to get max. rate
ANZ Progress Saver 0.01% 2.40% Deposit $10/month; make no withdrawals
CBA GoalSaver 0.01% 1.65% Deposit $200/month; make no withdrawal; keep balance under $50,000
NAB Reward Saver 0.50% 2.40% Deposit 1c/month; make no withdrawals
Westpac Life 1.00% 2.30% Deposit 1c/month; ensure balance is higher at end of month than start

However, there are numerous smaller institutions that offer higher interest rates.

For example, Move Bank, UBank, Bank First and ME Bank all offer maximum interest rates of between 2.85% and 2.90%.

Lender Product Base rate Max. rate How to get max. rate
Move Bank Bonus Saver 1.70% 2.90% Deposit $200/month; make no withdrawals
UBank USaver with Ultra 1.81% 2.87% Deposit $200/month; keep balance under $200,000
Bank First Bonus Saver 0.05% 2.85% Deposit $1/month; make no withdrawals; keep balance under $150,000
ME Bank Online Savings Account 1.30% 2.85% Make one weekly tap-and-go payment with Everyday Transaction Account debit card; keep balance under $250,000

Compare Australian savings accounts

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If you wanted to invest the $5,000 in a three-year term deposit, there is a similar interest rate gap between the big four banks and challenger lenders.

The big four banks are paying anywhere from 1.75% to 2.60% on three-year term deposits.

Lender Interest rate
ANZ 1.75%
CBA 1.90%
NAB 2.60%
Westpac 2.40%

However, there are plenty of smaller institutions that can top that, with three-year term deposit rates climbing as high as 3%.

Lender Interest rate
The Mutual 3.00%
Teachers Mutual Bank 3.00%
Australian Unity 3.00%
Bank Australia 3.00%

Compare Australian term deposits

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