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$0 Monthly | $0 Over 3,000 Westpac Group ATMs |  Global Currency Account | 1.50% | MasterCard | Apple Pay Google Pay Interest rate Overseas ATM facilities Samsung Pay Linked account | More details | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$5* Monthly | $0 |  Access Advantage | 0.02% | Visa | Apple Pay Google Pay Interest rate Overseas ATM facilities Samsung Pay Linked account | More details | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$0 Monthly | $0 Over 7,000 ATMs |  Classic Banking | 0.01% | Visa | Apple Pay Google Pay Interest rate Overseas ATM facilities Samsung Pay Linked account | More details | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$0 Monthly | $0 Over 3,000 rediATMs |  Glide Account | Visa | Apple Pay Google Pay Interest rate Overseas ATM facilities Samsung Pay Linked account | More details | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$0 Monthly | $0 Online only |  Xinja Bank Account | MasterCard | Apple Pay Google Pay Interest rate Overseas ATM facilities Samsung Pay Linked account | More details | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$0 Monthly | $0 Over 13,000 ATMs customers can use in Australia with no ATM fees |  Everyday Global Account | Visa | Apple Pay Google Pay Interest rate Overseas ATM facilities Samsung Pay Linked account | More details | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$0 Monthly | $0 Access at any ATM |  Orange Everyday | Visa | Apple Pay Google Pay Interest rate Overseas ATM facilities Samsung Pay Linked account | More details | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Think of an overdraft as extra money you can draw on in times of need. An overdraft works by allowing you to withdraw more money than what’s available in your bank account.
There are different types of overdrafts available – but in this instance, we’re referring only to overdrafts associated with personal (not business) transaction accounts.
An overdraft is essentially an unsecured line of credit. It’s similar to a credit card in that the credit amount is limited (or capped) and a variable interest rate is applied to the credit used.
However, overdrafts are a popular alternative to credit cards because they are attached to your day-to-day transaction account and don’t require additional PINs, cards or separate statements.
You might have experienced at one time a sinking feeling at seeing your bank balance in arrears. An overdraft can give you peace of mind (and take care of cashflow issues) by being on standby.
Most major banks and financial institutions offer personal overdrafts via a simple application process. You will need an existing transaction account beforehand.
How do I apply for an overdraft?
The application process for an overdraft is simpler than applying for a credit card. You can apply online through your existing financial institution, or shop around for an overdraft that appeals.
As with any credit product, there are credit assessment criteria that you may need to meet. However, it’s not as strict as the criteria applicable to larger loans such as mortgages.
In general, the eligibility criteria for overdrafts could require that you:
- Are at least 18 years old
- Have a regular income
- Are an Australian citizen, permanent resident or have a valid visa
When applying, ensure you have some form of identification on hand, your tax file number, your bank account information, and any income, employment and financial commitment details.
Is there a credit limit for an overdraft?
The limit for an overdraft can be as low as a few hundred dollars and can go as high as $50,000 or more. Overdrafts limits can be capped or based on an agreed value.
Your overdraft limit will depend on how much you want, your affordability, and/or your income. Different overdraft products will also have different variable interest rates, and fees and charges.
It’s important to ensure your negative balance doesn’t exceed the agreed terms (or your overdraft limit). Additional fees may be charged and higher interest rates may apply if this occurs.
The benefits of a bank account overdraft
- No set repayments
- Only pay interest on the credit used
- No or low monthly service fee
- Competitive interest rate
- Easy access to extra funds
- Linked to your transaction account
In addition to the benefits listed, the real value of an overdraft is that it’s attached to your transaction account. That means you can access credit the same way you would withdraw money.
You could make withdrawals using your overdraft in all the usual ways, including at an ATM; in a branch; BPAY; online, mobile or phone banking; and via EFTPOS.
A property and personal finance writer, Nick Bendel covers property, loans, credit cards, superannuation, and other bank products. Nick has previously written for The Adviser, Mortgage Business, Lifehacker, Business Insider, Yahoo Finance, and InvestorDaily, and loves getting elbow-deep in the latest ABS, APRA and RBA data.
FAQs
Yes, Australian bank accounts are frozen when someone dies. If you want to close the account of somebody who has died, you might have to provide proof of death and a copy of the will. You might also have to prove your relationship to the deceased person.
If you have a joint bank account with somebody who has died, you will generally be entitled to all the money in the account. Again, you might have to provide proof of death if you want to change the bank account from a joint account to a one-person account.
The good news for savvy young folks like you wanting to take charge of your finances is that there are many bank accounts available for under-18s.
For bank accounts that require you to be 18 or older, you’ll have to rope in a parent or guardian to open the account for you.
Otherwise, you can apply by yourself online or at the branch of the bank, credit union or building society that has the account you would like to open.
If applying online, you might be asked for a form of identification. For under-18s, this could be a Medicare card you’re listed on, your birth certificate and/or your current home address.
In most cases, you can verify your identity online (at the time of applying) or at the branch afterwards.
Opening a bank account in Australia is usually a straightforward process. Some banks give you the option of opening an account online, while others require you to visit a branch.
Different bank accounts offer different features, so it’s best to compare your options to find one that suits you.
All banks require you to pass an identity check to open a bank account. Australia uses the 100-point identification system, which means you’ll need to show a number of forms of ID that, together, add up to 100 points.
Common ID types include a driver’s licence, passport, Australian visa in a foreign passport, and Australian Medicare card. You’ll find out what types of ID are accepted when you go through the sign-up process online or at a branch.
Once your account is open, you’ll be given or sent a debit card that you can use to make purchases and withdraw money from your account.
Overdrawing a bank account can happen by accident. It’s often hard to know what your balance is, particularly with direct debits, scheduled repayments and pending transactions competing for cash.
To avoid being stuck with a bank fee every time your account is overdrawn, you can apply for a personal overdraft. This will enable you to overdraw your account up to an approved amount.
A personal overdraft is connected to your CommBank Everyday Account, so you can enjoy easy access to extra funds once approved – anywhere from $100 up to $20,000.
Your overdraft funds can be accessed via your CommBank keycard or Debit MasterCard, or online through NetBank and the CommBank app.
To apply you can either call the Commonwealth Bank directly or visit your local branch.
Unfortunately, there’s no definitive answer to the question of which bank is best for business accounts. That’s because ‘best’ will differ from customer to customer, depending on their unique circumstances. These include not only your company’s financial position, but also its size, its age and the sector in which it operates. Another factor to consider is what features you want in a bank account. Your business may require different features than another business; and your business may require different features tomorrow than it does today.
The best thing to do is to thoroughly research the market before opening a business account. And when you do open an account, you should reassess your options every year or two, because the market moves quickly. A particular bank might offer the best account today, but be surpassed by one or several rivals tomorrow.
Opening a bank account online is a simple process and only takes between five to 10 minutes to complete. To get started you will need a computer or smartphone with internet access.
Information to have available when you’re ready to apply is:
- Identification (such as driver’s licence, birth certificate, passport, proof-of-age card)
- Tax file number
- Residential address, email and a contact number
In some cases, you might be asked to provide employment details. If you’re not able to verify your identity online, most financial institutions let you provide this in the branch at a later date.
There are some types of bank account that you can apply for only in a branch. However, most bank accounts can be applied for conveniently online.
Yes, you can open another account at the same bank if you already have an account there, but some banks place a limit on how many specific accounts you can open.
Generally, though, it is possible to have more than one everyday account, one personal account and one joint account, or have different types of accounts – such as a transaction account and a savings account.
Keep in mind that some bank accounts come with fees, so you could be charged twice for having two types of the same account at the same bank.
Also, if you have more than one high-interest transaction account at the same bank, only one account will be able to earn the highest rate of interest.
Once you’ve compared bank accounts and found the right one, the process of opening a bank account online is quite simple and can be done in around 10 minutes.
To set up a bank account online, you’ll need to prove your identity and provide an approved form of ID as well as your tax file number (TFN).
If you’re a new customer of the bank, you’ll need to verify your identity and potentially upload documents before you can complete your online application.
Once your ID has been verified and you’ve set up your bank account online, you should receive your bank cards in the mail along with your PIN and any other account details.
Just because you’re in business doesn’t necessarily mean you need a business bank account. You could be a sole trader not registered for GST, and use your personal bank account for business.
If you do want a business account, there are plenty of benefits attached to business transaction and savings accounts, as well as business term deposits.
There are business bank accounts designed for businesses with a high volume of transactions, and those for start-ups with a small amount of trade. You could also include an EFTPOS service with your account.
Some business bank accounts charge for the number of transactions per month, while others offer a pay-as-you-go fee structure, where you only pay fees for transactions you make.
It’s up to you whether your priority is mainly transactions, or earning the maximum amount of interest on your principal. There’s a business banking solution for you if you need one.
A common question for new parents is, ‘Can I open a bank account for my child?’
The short answer is yes – as a parent you can open a bank account for your child.
Once you’ve compared your options and found a bank account that suits your needs, the process is relatively simple.
As the bank account is for your child, you’ll need to provide some documentation such as proof of ID, including your tax file number.
You will also need a copy of your child’s birth certificate, and in some cases you may also need to sign a guarantee of indemnity.
Depending on the bank and whether you’re an existing customer, you may be able to open a bank account for your child online. However, you may still need to go into a branch to prove your identity.