Mozo Money Moves: Relief finally lands after banks pocket millions, as base rates take another hit.

This week we’re back with another bumper edition of Money Moves, as just over one week after the Reserve Bank of Australia (RBA) delivered the rate cut, mortgage relief is finally starting to kick in. 

A wave of variable rate home loan changes have now come into effect, but not before banks made a tidy sum holding out. For savers though the tide of high returns is already turning, as rates starting with 3 and 4 become the new norm and the highest rate savers can secure in return for their hard earned cash continues to drop.

Variable rate cuts land – ten days later.

It’s taken over a week, but the floodgates are finally open. After the RBA’s 25 bps rate cut last Tuesday, a wave of variable home loan rate reductions have officially rolled through the Mozo database today. 11 home lenders have dropped their rates today, making it a total of 19 who have cut this week. 

As of today, three of the Big Four banks – NAB, ANZ, Commbank – have all trimmed 25 bps from their variable home loan rates. Ubank (backed by NAB) also cut rates, there was movement from customer-owned banks including Newcastle Permanent, IMB Bank and People’s Choice, and challengers like Suncorp also cut. And there’s more coming. 

Westpac and all its subsidiaries (BankSA, Bank of Melbourne, St.George) will follow next week, the last of the Big Four bank brands to cut, along with 28 lenders already queued up to cut between now and June 6. Other notable challenger banks ING, AMP, Bendigo Bank and HSBC, alongside a number of customer-owned banks including Regional Australia Bank. 

“The gap between the majors and the rest hasn’t closed, it’s just moved down in lockstep,” says Mozo’s personal finance expert Rachel Wastell. “So, while the rates might be lower now, the value proposition hasn’t changed – you still have to compare to get a better deal.”

This Week's Home Loan Rate Cuts (Variable)

Banks pocket over $75million in the last week

As most banks have taken their time passing on the rate cuts to borrowers – excluding the likes of Athena, Unloan and Macquarie – we thought it would be interesting to see the interest banks have earnt, by holding off on these cuts for a week or more.

Collectively, based on Mozo’s analysis of APRA data and assuming interest is applied evenly across all household lending, Australia’s banks have likely pocketed over $75 million by delaying the full 25 basis point cut. 

Commbank kept a tidy $18 million, followed by Westpac at $15 million. While a handful of lenders acted early, 28 more lenders are queued to cut next week, meaning some banks could end up pocketing two weeks’ worth of additional interest. This includes Westpac, the last Big Four bank to cut, that is shifting variable rates down exactly two weeks on from the RBA’s cash rate cut.

5.15% p.a. the new leading rate from Monday.

Following the RBA’s 25bp cash rate cut last week, banks have wasted no time trimming their most competitive savings products, but as usual these have not been as easy to find as the cuts to home loan rates. 

“If you’ve been clinging to a savings rate that starts with a five, brace yourself, because we may be watching the final days of that era unfold in real time,” says Wastell. “Once a crowded category, savings bonus rates starting with 5 are now going to be a rarity.”

Currently ING’s 5.40%p.a. bonus rate is the leading rate, but as of Monday, ING will cut its market leading rate on its Savings Maximiser account, to take it to 5.00%p.a. – the base rate will remain at 0.05%. After this move from ING, there’ll be multiple banks vying for first in the bonus rate savings space with 5.00%p.a the highest rate on offer – including MOVE Bank, BCU Bank, P&N Bank and RACQ Bank. 

Surprisingly, Westpac bumped up its Life Saver savings bonus rate for savers up to 29 years old, and it will join the list of leading savings rates on offer from next Monday onwards, a rare spot for a Big Four bank to sit.

However, on the introductory rate side, Rabobank will take the lead with its 5.15%p.a. introductory rate for 4 months on the High Interest Savings Account. Though a far cry from the 5.75%p.a. they were offering when the cash rate was at the peak, it will be the most any bank is offering savers in return for their hard earned cash as of Monday. This will revert back to 4.10%p.a. after the intro period is over. 

Leading At Call Savings rates (post RBA cut)

Base rates take another hit

The Mozo team have been watching base rates slide quietly since last year, and while most of the post-RBA cuts have zeroed in on bonus reductions, this week the base rate trend re-emerged. Two banks in particular have deliberately repriced their savings products to make sure that customers who don’t meet the bonus conditions end up earning even less.

ME Bank’s headline reduction to its HomeME account was just 15 basis points, but the base rate (the rate you receive if conditions are not met) was slashed by 50 bps 0.55% to just 0.05%, while 35 basis points were added back onto the bonus. On paper, that may not seem dramatic as just a 0.15%p.a. reduction to the maximum rate,  but for customers with balances that don’t consistently meet the bonus criteria, the difference in earnings could be more noticeable than expected. 

At ANZ, the cuts were more straightforward, while they didn’t add basis points onto the bonus to hide the reduction to the base, the entirety of the 25 basis point cut was to the base rate on its ANZ Plus Save account. Taking the base rate down to just 0.15% 

Are term deposits a safe haven?

With savings rates falling and more cuts likely, term deposits are shaping up to be one of the few safe havens left, at least for now. Banks are moving quickly to reprice their term deposits ahead of what's expected to be a longer round of rate cuts from the RBA.

Some of the Big Four are now forecasting two, possibly three more cuts by December, which could see the official cash rate fall as low as 3.10%,” says Wastell. 

“Locking in a fixed term deposit now could end up being a smart move in hindsight, especially if you don’t need access to the cash and are saving for a longer-term goal, like buying a house.”

On the Mozo database looking at personal deposit rates for balances of $25,000 or more, there are only eight one-year term deposits left above 4.20%p.a. The outlook for longer terms is even bleaker, with just seven rates above 4% for two and three year term deposits.

What are the Big Four predicting will happen to the RBA cash rate?

• Westpac: 3.60% by September, 3.35% by December
• NAB: 3.35% by September, 3.10% by December
• CommBank: 3.60% by September, 3.35% by December
• ANZ: 3.35% by September, holding steady after that

Keep up to date with the Big Four forecasts.

Commbank drops again – but doesn’t make the cut

While the variable rate cuts have finally landed, the fixed rate market has been quietly shifting too, and while not enough to steal the spotlight the Commonwealth Bank dropped its one-year fixed rate by 40 basis points and cut 25bps off most of its other fixed term offers. 

“Commbank is the first major reset to its fixed rate suite since the RBA’s May decision, and is the second time they’ve cut fixed rates this month,” says Wastell, “but despite the drop they still don’t make the cut.”

Even with the full discount, Commbank’s cheapest one-year fixed rate now sits at just 5.69%p.a. (with a package and a comparison rate* of 7.75%p.a.), but the leading one-year fixed rate from Homeloans360 is 4.99%p.a. (5.35%p.a. comparison rate*). This equates to a $207 monthly repayment difference on a $500,000 home loan paying principal and interest over 25 years. For those borrowers who still want the convenience of banking with a big bank, Macquarie’s Basic Home Loan and HSBC’s offer 5.39%p.a. for one year fixed rate loans, with comparison rates* of 5.68% p.a. and 6.30% p.a. respectively. 

“That 30 basis points might not seem like a lot, but when you’re looking at a $500,000 home loan paying principal and interest over 25 years, that saving shaves $90 off your monthly repayment,” says Wastell.

Looking at two and three year fixed terms, the landscape becomes even more competitive, and this week IMB Bank also cut 0.40% off fixed rates, bringing its two and three year fixed terms down to 5.29% p.a. (with comparison rates* of 5.72% and 5.69%, respectively). Bank of Queensland currently holds the lowest two-year fixed rate in the Mozo database at 4.99% p.a., but that’s restricted to borrowers with an LVR of 80% or less and IMB’s offer is available to customers with a loan-to-value ratio of up to 95%.

“With a $4,000 cashback offer on the table for new or refinanced loans, it’s one of the most compelling fixed deals we’ve seen in months for borrowers with smaller deposits or less equity,” says Wastell 

“However, make sure if you are looking to fix that you are comfortable with the potential of missing out on cash rate cuts likely to come through over the next year. If not – you might consider splitting your loan into part fixed, part variable, or just sticking with a low rate variable loan instead.”

As the fixed rate market adjusts to expectations of further RBA cuts, and with some of the Big Four predicting the cash rate could hit 3.10% by December, it’s likely fixed rates will continue to trend down and we may see more lenders follow suit.

 *WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.

Leading Fixed Rates

Mozo reveals the Best Value Broadband Plans in 2025

This week our team was also excited to reveal the winners of the Mozo Experts Choice Awards for Broadband 2025, after the extensive analysis of 316 NBN and 5G broadband plans from 69 providers.  The minimum cost of each plan over a 24 month period was calculated, including set up costs, monthly charges and introductory discounts.

“Broadband plans can be one of those bills that most set and forget, without realising that convenience can come at a cost,” said AJ Duncanson, Mozo’s Data Director and Mozo Experts Choice Awards Judge.  

“Whether you’re a remote worker or live in a house full of gamers, the Mozo Experts Choice Award winners list can help Aussies looking for a better deal on their broadband switch smart and save.”

Australia’s Best Broadband Provider: In this year’s awards, Spintel took out the top spot, named Australia’s Best Broadband Provider for 2025. Winning awards for Basic, Fast, SuperFast and Ultra Fast broadband plans, Spintel’s performance across multiple categories could not be ignored.

“Spintel’s consistent performance and the value they offer Aussie consumers earned them the privilege of Australia’s Best Broadband Provider for 2025” says Duncanson. “After taking out wins in Fast, Standard, Super Fast and 5G Home Broadband categories last year, they’ve claimed the top spot to cement their position as the leading provider in broadband plans.”

Highly Commended: Flip also stood out as a top performing provider, receiving the Highly Commended Broadband Provider of the Year for 2025.

“Flip was our Broadband Provider of the Year in 2024 and has once again proven their strength with multiple wins” Duncanson said. “Flip’s back-to-back performance shows they’re still a serious contender when it comes to value, and worthy recipients of this commendation.”

Check out the full winners list here or read the media release.

As a part of Mozo’s commitment to making your money count for more, each month we “roundup” the rate changes, key banking trends and money moves in the Australian personal finance market. 

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