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Westpac cuts rates on popular savings accounts

Westpac cuts rates on popular savings accounts

Australia’s second largest bank, Westpac, has today cut savings rates by 0.05 per cent.

Westpac Life changes

Old rateNew rateChange
Max rate

0.30%

0.25%

-0.05%

Base rate

(if monthly conditions aren’t met)

0.15%

0.15%

0.00%

Note: customers must increase balance each month for max rate.

Westpac e-Saver changes

Old rateNew rateChange
0.30% for 5 months then 0.05%0.25% for 5 months then 0.05%

-0.05%

Westpac hasn’t touched its savings rate for young adults, which remains at a market-leading 2.50 per cent.

RateCity.com.au analysis shows:

  • Over 40 banks have cut at least one savings rate in the last two months including all four big banks.
  • 0.29% is the average ongoing savings rate for all adults.
  • 1.35% is the highest ongoing rate for all adults.
  • 12 banks have an ongoing savings rate of 1 per cent or more.

Sally Tindall said: “These cuts from Westpac are not unexpected and follow the market which is still heading south.”

“In the last two months over 40 banks have trimmed savings rates despite no move to the cash rate in over a year,” she said.

“The problem for the banks is that they’re brimming with cash, as COVID has encouraged Australians to save for a rainy day.

“The latest APRA statistics show Australian households have $1.20 trillion in the bank, that’s up $108 billion from the same time last year.

“With deposits at a record high, most banks aren’t willing to offer up a decent savings rate,” she said.

Big four bank: conditional savings rates

BankAccountMax rate
CBAGoalSaver

0.25%

WestpacLife

0.25%

NABReward Saver

0.25%

ANZProgress Saver

0.25%

Source: RateCity.com.au. Conditions apply for max rate.

Big four banks standard savers

BankProductIntro rate (3-5 mths)Ongoing rate
CBANetBank Saver

0.29% 

 0.05%

WestpaceSaver

0.25%

0.05%

NABiSaver

0.30%

0.05%

ANZOnline Saver

0.20%

0.05%

Source: RateCity.com.au Intro rate terms - CBA & Westpac 5 months, NAB 4 months, ANZ 3 months.

Highest ongoing savings accounts (no age restrictions)

BankMax rate
ING

1.35%

Virgin Money

1.50% for 3 mths then 1.20%

86 400

1.20%

Source: RateCity.com.au $25k balance. Conditions apply for max interest rate.

Young Adults: highest ongoing savings rates

BankAccountMax rate
Westpac LifeAges 18 to 29 (up to $30K)

2.50%

BOQ Fast Track StarterAges 14 to 24 (up to $10K)

2.50%

Source: RateCity.com.au Conditions apply for max interest rate.

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This article was reviewed by Janet Lee before it was published as part of RateCity's Fact Check process.

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