Continued bank branch closures and the rise of online banks
![](http://cdn.mozo.com.au/redactor/pictures/8849/closed_for_business_original.jpg)
It’s quite likely that you’ve noticed a number of bank branches quietly closing down over the past few years in your area, town or even city. Or if banks aren’t on your radar much because you do all your banking online, you may have found it harder and harder lately to find an ATM, for that once in a blue moon time you want to get hold of some actual cash.
Well according to statistics released by the Australian Prudential Regulation Authority last week, physical bank branches have been reducing in numbers all over the country in the past few years.
The APRA’s ‘Points of Presence’ statistics showed that the number of bank branches in major cities across Australia has gone down by approximately 9% in just two short years. Further to that the number of bank branches available across each state also seems to be in steady decline, with Queensland notably losing as much as 11% of its bank branches between 2017 and 2019.
Why are more and more bank branches closing down?
Mozo Banking Expert Peter Marshall said, “the harsh reality of the world we live in these days is that bank branches are less and less relevant. One of the main purposes of banks having branches has been to meet the needs of customers who use cash, and as cash is in serious decline as a payment method, there is simply less of a requirement for them”.
RELATED ARTICLE: Digital banking and neobanks
Online banks vs ‘non-online’ banks and the Big Four
This “evolution of banking” as Marshall referred to it as, could be an opportunity for many Australians to jump ship and take advantage of all the perks online banks and neobanks have to offer.
As well as giving you access to your banking 24/7, online banks often offer more competitive interest rates than banks with physical branches and many have accounts with zero monthly account keeping fees.
In fact, online banks currently take out 3 of the top 5 spots in the Mozo database for the maximum interest to be earned on a bonus savings account**, with neobanks 86 400 and Up Bank currently tied for 2nd place and online bank ME coming a close third.
The average maximum interest rate for a bonus savings account with an online bank currently stands at 1.98% p.a. which is significantly higher than the average 1.61% p.a.* maximum interest rate offered on a bonus savings account with all other ‘traditional’ banks, or in other words banks with physical branches.
What’s more, the average maximum interest rate offered for a bonus savings account with one of the big four is even lower, currently standing at 1.44% p.a. That’s a hefty 0.54% p.a. less than the average interest to be earned with an online bank for the same type of savings account.
Online Bank bonus saver accounts in the top 5:
- 86 400 Save Account : maximum interest rate of 2.25% p.a when you deposit at least $1,000 once a month into either your Pay or Save Account.
- Up Bank Saver Account: maximum interest rate of 2.25% p.a.when you make 5 or more purchases through your Up everyday transaction account each month.
- ME Bank Online Savings account: maximum interest rate of 2.20% p.a. when you make 4 tap and go purchases with your ME everyday transaction debit card.
Traditional Bank bonus saver accounts in the top 5:
- MyState Bank Bonus Saver Account: maximum 2.50% p.a. interest rate when you make at least 5 purchases throughout the month through a linked everyday account and deposit at least $20.
- Bank of Queensland Fast Track Saver Account: maximum interest rate of 2.15% p.a. when you transfer at least $1,000 each month into your corresponding Day2Day Plus transaction account.
How much can you save by switching to an online bank?
Let’s break it down using Mozo’s Savings Calculator.
Say you open a bonus savings account with a starting balance of $5,000, deposit $200 per month and meet all the relevant criteria to achieve the maximum interest rate. With an online bank on average you would earn approximately $122 of interest over the course of the year and your closing balance would be $7,522.
Now take the same situation but you open your bonus savings account with a non-online bank. With the same amount of money and the same amount of deposits each month, you would earn approximately $99 worth of interest and your closing balance would be $7,499.
Lastly, imagine you have the exact same situation but this time you open a bonus savings account with one of the big four. On average you would earn approximately $88 of interest over 1 year and have a closing balance of $7,488.
That’s $34 worth of interest that’s better off in your pocket than the big banks' profit sheet.
Seize the day!
So if you’re ready to channel some good ol’ carpe diem and seize a higher interest rate for your savings, check out the bonus savings accounts below or head to Mozo’s savings account comparison page to see if you could be getting a better deal.
Compare bonus saver accounts
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Savings Account
5.35% p.a. (for $0 to $250,000)
4.75% p.a.(for $0 to $1,000,000)
Yes up to $250,000
Bonus variable rate is available for the first 4 months.
Competitive introductory variable rate for first 4 months (on deposits up to $250,000). No account keeping fees to pay. Multiple 2024 Mozo Experts Choice Award winner.
CompareCompareSavings Account
Competitive introductory variable rate for first 4 months (on deposits up to $250,000). No account keeping fees to pay. Multiple 2024 Mozo Experts Choice Award winner.
- Maximum rate
- 5.35% p.a. (for $0 to $250,000)
- Standard interest rate
- 4.75% p.a.(for $0 to $1,000,000)
- Govt Deposit Guarantee
- Yes up to $250,000
- Standard interest rate
- 4.75% p.a.(for $0 to $1,000,000)
- Account fee per month
- $0.00
- Access
- BPay, Branch access, Phone banking, Internet banking
- Minimum balance
- $0.00
- Other restrictions
- Must have a Macquarie Transaction Account to link with.
Read our Mozo Review to learn more about the Macquarie Savings Account
-
Mozo experts choice awards won:
- High Interest Savings - 2024
Savings Maximiser
5.50% p.a. (for $0 to $100,000)
0.55% p.a.(for $0 and over)
Yes up to $250,000
For customers who have an Orange Everyday account, deposit $1000 into a personal ING account, make 5 eligible transactions and grow their nominated Savings Maximiser account each month.
Great variable rate every month when you grow your balance each month in addition to other eligibility criteria. No ING fees to pay. Save even more with ING Everyday Round Up. Mozo Experts Choice Awards Everyday & Savings Bank of the Year winner for 2024.^
CompareCompareSavings Maximiser
Great variable rate every month when you grow your balance each month in addition to other eligibility criteria. No ING fees to pay. Save even more with ING Everyday Round Up. Mozo Experts Choice Awards Everyday & Savings Bank of the Year winner for 2024.^
- Maximum rate
- 5.50% p.a. (for $0 to $100,000)
- Standard interest rate
- 0.55% p.a.(for $0 and over)
- Govt Deposit Guarantee
- Yes up to $250,000
- Standard interest rate
- 0.55% p.a.(for $0 and over)
- Account fee per month
- $0.00
- Access
- Phone banking, Internet banking
- Minimum balance
- $0.00
- Other restrictions
- Must be linked to an Orange Everyday transaction account to receive the bonus rate. Where multiple Savings Maximiser Accounts are held, the bonus rate is only applied to one nominated account.
Read our Mozo Review to learn more about the ING Savings Maximiser
-
Reward Saver Account
5.25% p.a. (for $0 to $1,000,000)
0% p.a.(for $0 and over)
Yes up to $250,000
Intro bonus rate of 5.25% for balances up to $1,000,000 for the first 4 months, reverting to 3.25%. Minimum deposit of $50 and no withdrawals.
Introductory bonus rate for balances up to $1,000,000 for the first 4 months. Minimum deposit of $50 and no withdrawals. Start your account online in under 10 minutes and earn interest on balances up to $1,000,000 (T&Cs apply). No monthly account fees, helping you save smarter and faster.
CompareCompareReward Saver Account
Introductory bonus rate for balances up to $1,000,000 for the first 4 months. Minimum deposit of $50 and no withdrawals. Start your account online in under 10 minutes and earn interest on balances up to $1,000,000 (T&Cs apply). No monthly account fees, helping you save smarter and faster.
- Maximum rate
- 5.25% p.a. (for $0 to $1,000,000)
- Standard interest rate
- 0% p.a.(for $0 and over)
- Govt Deposit Guarantee
- Yes up to $250,000
- Standard interest rate
- 0% p.a.(for $0 and over)
- Account fee per month
- $0.00
- Access
- ATM, EFTPOS, Visa Debit, Cheque book, BPay, Branch access, Phone banking, Internet banking, Bank@Post
- Minimum balance
- $0.00
- Other restrictions
- -
Read our Mozo Review to learn more about the IMB Bank Reward Saver Account
-
Bonus Saver Account
5.00% p.a. (for $0 to $250,000)
0.05% p.a.(for $0 and over)
Yes up to $250,000
Bonus rate when at least $20 is deposited each month and five Visa Debit transactions are made each month using linked Glide transaction account.
Start saving and earn interest with just a $20 deposit and make 5 eligible transactions each month. No fees or penalties for withdrawing money.
CompareCompareBonus Saver Account
Start saving and earn interest with just a $20 deposit and make 5 eligible transactions each month. No fees or penalties for withdrawing money.
- Maximum rate
- 5.00% p.a. (for $0 to $250,000)
- Standard interest rate
- 0.05% p.a.(for $0 and over)
- Govt Deposit Guarantee
- Yes up to $250,000
- Standard interest rate
- 0.05% p.a.(for $0 and over)
- Account fee per month
- $0.00
- Access
- Phone banking, Internet banking
- Minimum balance
- $0.00
- Other restrictions
- Must link to a transaction account
Read our Mozo Review to learn more about the MyState Bank Bonus Saver Account
-
Mozo experts choice awards won:
- Kick Start Savings - 2024
High Interest Savings Account
5.75% p.a. (for $0 to $250,001)
4.40% p.a.(for $0 to $250,001)
Yes up to $250,000
Bonus rate for the first 4 months from account opening
Reward yourself with a higher rate for your good savings habits with the Rabobank High Interest Savings Account. No Account keeping fees. No minimum balance. Support Aussie farmers with every dollar you save.
CompareCompareHigh Interest Savings Account
Reward yourself with a higher rate for your good savings habits with the Rabobank High Interest Savings Account. No Account keeping fees. No minimum balance. Support Aussie farmers with every dollar you save.
- Maximum rate
- 5.75% p.a. (for $0 to $250,001)
- Standard interest rate
- 4.40% p.a.(for $0 to $250,001)
- Govt Deposit Guarantee
- Yes up to $250,000
- Standard interest rate
- 4.40% p.a.(for $0 to $250,001)
- Account fee per month
- $0.00
- Access
- Internet banking
- Minimum balance
- $0.00
- Other restrictions
- Must link to a transaction account
Read our Mozo Review to learn more about the Rabobank High Interest Savings Account
Your selected savings accounts
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*Average interest rates for bonus savings accounts gathered from the Mozo database and based on a bonus savings account with a balance of $10,000. Averages correct as of Monday 28th October, 2019.
**Maximum interest rates for bonus savings accounts with a balance of $10,000. Correct as of Monday 28th October, 2019.
^See information about the Mozo Experts Choice Savings Account Awards
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