Money in the bank ain't what it used to be

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There are now very few transaction accounts in Australia that pay even 1 per cent in interest without imposing monthly fees or difficult conditions.

A RateCity analysis has found three that fit the bill – bank accounts from Gateway Bank, Bank of Sydney and Macquarie Bank (see table below).

None charge a monthly fee. All three pay at least 1.10 per cent in interest, provided you have a minimum balance of anywhere from $1 to $5,000 (depending on the bank).

While there are other everyday bank accounts that pay higher interest rates, they charge monthly fees or require sizeable balances or require sizeable monthly deposits.

There are also some pension bank accounts and student bank accounts that pay higher interest rates without charging monthly fees.

Australia’s inflation rate is currently at 1.9 per cent, so deposits in those Gateway, Bank of Sydney and Macquarie accounts are actually going backwards in real terms.

Lender Account Monthly fee Interest
Gateway Bank Edge Account None 1.50% for balances of $1,000 and above (0.01% up to $999)
Bank of Sydney Everyday Saver None 1.35% for balances of $1 to $50,000
Macquarie Bank Transaction Account None 1.10% for balances of $5,000 and above (0.00% up to $4,999)

^Words such as "top", "best", "cheapest" or "lowest" are not a recommendation or rating of products. This page compares a range of products from selected providers and not all products or providers are included in the comparison. There is no such thing as a 'one- size-fits-all' financial product. The best loan, credit card, superannuation account or bank account for you might not be the best choice for someone else. Before selecting any financial product you should read the fine print carefully, including the product disclosure statement, fact sheet or terms and conditions document and obtain professional financial advice on whether a product is right for you and your finances.

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