This week in banking - 10 million Aussies to seek financial hardship and 5 other things you don’t want to miss!

Polly Fleeting

Friday 29 May 2020

  • 54% of Aussies predict they’ll have to apply for financial hardship 
  • 2020 Mozo People’s Choice Awards: Aussie customers’ fave financial and household services 
  • Westpac extends mortgage relief during COVID-19
  • Aussies relying on their insurance more than ever before 
  • What’s happening in the world of neobanks: Hay, Revolut and Volt. 
  • Big four term deposit rates keep on falling 

All in this week’s banking recap. 

Woman on her phone in the living room, applying for financial hardship.

COVID-19: Over half of Aussies to apply for financial hardship

New Mozo research reveals that 54% of Aussies (over 10 million) foresee themselves applying for financial hardship over the next six months as a result of COVID-19. 

So far, banks have had a huge 500,000 COVID-related financial hardship applications, even though 71% of Australians say they have not applied for assistance before. 

The numbers showed that 25% of people say that home loan repayments are causing the highest financial stress levels while 14% are concerned about not being able to make rent. 

Read full article: 10 million Aussies to seek financial hardship due to COVID-19 to find out what Aussies are doing in response. 

2020 Mozo People’s Choice Awards have been dropped! 

The power was put in the hands of the people, and they have spoken with the 2020 Mozo People’s Choice Awards

In its 11th year, we asked thousands of Aussies to rate providers in both financial and household services. And boy did they deliver! 

We have a full list of customers’ favourite providers across 12 different categories: banking, home insurance, car insurance, superannuation, electricity, mobile plans, NBN, Buy Now Pay Later, Supermarket, Online Supermarket, Online Wine & Alcohol, and Online Pet Supplies. 

“Whether you’re looking to switch car insurance providers or you’re after a new mobile phone plan, word of mouth recommendations are an invaluable piece of information to factor into your decision,” said Mozo Banking Expert, Peter Marshall

“So don’t just take it from us, take it from the thousands of Austalians who voted in this year’s Mozo People’s Choice Awards. The proof is in the pudding.”  

Read full article: 2020 Mozo People's Choice Award-winners announced for the ins and outs of finding out this year’s winners. 

Westpac extends mortgage relief by up to 12 months 

Last weekend, Westpac announced that its home loan customers who have been financially hit by COVID-19 will have access to extended repayment relief. 

For eligible customers making interest-only mortgage payments, they will be able to extend their interest-only period by up to 12 months. And for customers paying principal and interest, they have the option to switch to an interest-only repayment plan. 

Before this latest announcement, Westpac was offering customers mortgage deferral for up to three months, with the option to extend by another three months if they qualify. 

Westpac home loans general manager, Will Ranken confirmed that a staggering 100,000 Westpac customers have taken up the opportunity to defer repayments so far. 

Read full article: Westpac extends COVID-19 mortgage relief by up to 12 months to check out what else Mr Ranken said about these numbers and Westpac’s decision to lengthen deferral options. 

How Aussies’ rely on insurance safety blanket in 2020

In a recent meeting of the Insurance Council of Australia, chief executive Rob Whelan revealed that $4.6 billion worth of insurance claims have been made since September. 

And a whopping $2.26 billion of them were as a result of the recent bushfires. 

Plus, other major events in 2020 also have Aussies leaning on their insurance a little differently: such as COVID-19 causing people to make travel insurance and health insurance claims, and less car usage due to social distancing resulting in lower car insurance premiums. 

Read full article: Home insurance leads our insurance needs in 2020 for an in-depth look at what the world of insurance in Australia looks like now. 

...And in neobank news 

Missed what’s been happening in the land of neobanks with COVID-19 updates flooding your news feed? Don’t fret, we’ll help you catch up. 

Over the last month it’s been a relatively busy one for the new digital kids on the banking block, here’s a rundown of what’s happened: 

  • Xinja cut it’s Stash account rate 
  • 86 400 slashed home loan rates 
  • Hay introduced an in-app transfer feature HayPay
  • Revolut was granted an Australian Financial Services Licence (AFSL) 
  • Volt announced delay on launching home loans. 

Read full article: ICYMI: Hay launches HayPay, Revolut obtains AFSL and Volt delays loans to get down to the nitty gritty of what’s happening with Aussie neobanks. 

Big four term deposit interest rates fall from glory  

Big bank term deposit rates are falling the hardest among providers despite having competitive rates two months ago. 

In March, the big four had some of the top rates on offer as part of their response to the outbreak of COVID-19. However, those rates no longer exist. 

ANZ, CommBank and Westpac all made cuts to their 3-month, 6-month, 1-year and 5-year term deposit rates in the last two months, while NAB has made two cuts and two increases to its term offerings. 

At the moment the big four 6-month term deposit rate sits at a low 0.84%, while the average across all providers on the Mozo database is 1.36%. 

Read full article: Big four term deposit rates continue downward spiral for more average comparisons across a range of different terms. 

Looking for a competitive term deposit option? Why not take a look at some deals below!

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