Interest rates

  • Need info on the latest interest rates or news about the reserve bank decisions? At Mozo, we track hundreds of Australian financial institutions - from the big 4 banks to the smallest of online lenders and credit unions. We also keep a very keen eye on the reserve bank cash rate and how the banks, credit unions and building societies react to rate changes. If you need to find the best interest rates in Australia for home loans, term deposits or savings accounts, Mozo has got you covered.

  • Comparing apples with apples

    When you are researching your home loan or personal loan make sure you are comparing apples with apples. Look for the comparison rate information as this takes into the interest rate, account fees and charges into single rate to show you the true cost of a loan and help you pick the best one. Remember the lowest rate is not always the best interest rate - also important to think about features such as repayment options and any ongoing fee that will impact how much interest you pay.

Compare interest rates

Reserve Bank interest rate decision

  • August 2016 - RBA cuts interest rates to landmark low 1.50%

    As the dust settles from Brexit and the Australian Federal Election, the Reserve Bank is shaking things up yet again, by cutting interest rates to an unprecedentedly low 1.50%.

  • June 2016 - RBA freezes interest rates at 1.75% as winter hits

    After last month’s shock interest rate cut to 1.75%, things are calming down again for the Aussie economy, as the Reserve Bank announced rates will remain on hold throughout June.


RBA and the official cash rate

The Reserve Bank of Australia is the body who sets the official cash rate, which is the standard against which banks set their own interest rates. 

The RBA meets on the first Tuesday of every month and discusses the state of the national economy, including things like consumer confidence, inflation, economic growth and employment levels.  Based on these factors, the official cash rate either decreases, increases or stays the same.

This system is designed so that higher rates will discourage borrowing and spending, therefore lowering inflation. Lower rates do the opposite, increasing Australians’ ability to borrow and spend money, boosting the economy.

For the most recent information on the RBA cash rate, read our monthly reserve bank interest rate summary.

Types of interest rates

Fixed interest rates

A fixed interest rate means that the interest on your loan or savings is locked in at a certain value, and isn’t affected by rises or falls in the market. This can be both a blessing and a curse, but if you like a sense of certainty with your finances, a fixed interest rate might be for you. A fixed interest rate makes budgeting easier, because you’ll know what the amount will be each month, whether it’s a repayment or extra money in your account.

Variable interest rates

Variable interest rates are more flexible, and shift with the market. They are also based on the RBA’s official cash rate, but unlike a fixed interest rate, they don’t lock in at any time. So if your loan or savings are working on a variable interest rate, the amount of interest you pay or earn can change day-to-day.

What to look for when you choose an interest rate

If you’re borrowing...

So you’re buying a new home, setting up a business or searching for a new car? Then you’re probably looking for a loan to make your dreams possible. 

It’s important to do some research before you go ahead with choosing a lender, because the current interest rate will affect not only your monthly repayments, but how much you ultimately spend at the end of your loan term.

The goal is to secure a low interest rate on your loan to minimise the amount of interest you’ll need to pay, but that isn’t all you need to consider. Fees, charges, penalties and extra features are all things you need to take into account when choosing the best loan.

It might seem like a hard task, but it’s made easier by using the comparison rate. This is a rate that providers are required by the National Credit Code to show, and it factors in interest, fees and charges for a clearer picture of the real cost of a loan. That’s why, when you’re comparing products on Mozo, whether it’s home loans, car loans or personal loans, you’ll see an interest rate and a comparison interest rate.

Handy right? But there is one thing to keep in mind when using the comparison rate - it is a guide based a specified loan amount and timeframe (which is shown on Mozo’s comparison pages). Different loans will mean different comparison rates, so to find out exactly what you’ll be paying in interest, talk to your lender.

...Or saving

When you’re looking to make the most of your savings by earning as much interest as possible, your needs will be different depending on your goals. If you’re saving for a short term goal, a savings account with a high introductory interest rate might be just the boost your savings stash needs. Or, if you’ve got a decent chunk of funds but don’t need to access them, a term deposit might be a better space to park it for a while.

No matter how long you’re putting your savings away, the goal is to get a high return on your money, which means securing a high interest rate. 

You should also consider special promotions like introductory interest rates or bonus interest rates, and be wary of account or transaction fees. Things like savings accounts or term deposits don’t show a comparison rate to keep track of these extra considerations, but here at Mozo, we’ll show them to you on our comparison pages.

How can I find the best interest rate?

We can’t stress enough the importance of comparing interest rates before you make a decision about your finances! At Mozo, that’s what we’re all about, but we know it can sometimes be hard, because not only do you need to consider the best interest rate available, but also any extras fees and charges that you might get hit with. So we’ve made it easier with some tools and resources that will guide you through securing yourself a great interest rate.

Check out our comparison pages! This is the first stop when looking for a great interest rate. You can see a side-by-side comparison of all the best offers on the market.

Home loans

Personal loans

Car loans

Savings accounts

Term deposits

Take a look at our easy to use calculators. Whether you’re working out what your loan repayments will be or planning your savings goals, we’ve got a calculator ready to crunch those numbers!

Home loans calculators

Personal loans calculators

Car loans calculators

Savings accounts calculators

Term deposits calculators

Read our dedicated guides. For a more in depth explanation check out our guides which cover everything from working out how much you can afford to borrow on your home loan, to how to make the most out of your savings account.

Home loan guides

Personal loan guides

Car loan guides

Savings account guides

Term deposit guides

For more information on interest rates for different banking products, and for help understanding what interest rates are and how they work, visit our interest rates guide page.