March savings snapshot: How low can interest rates go?

Person sitting at computer looking out window, worried about declining interest rates.

Like a gymnast at a limbo competition, savings account interest rates keep edging lower. 

Over the last month, 37 different accounts monitored by Mozo’s data team saw reductions, with many conditional bonus rates tumbling down to sit worryingly close to their base rate counterparts.

This has brought the average ongoing savings rate to 0.40% – another 3 basis points (bp) down on last month – according to Mozo’s database.

Market leaders make changes

Moves are happening across the board, including in accounts leading the rate pack. 

The Macquarie Savings Accounts four-month introductory rate was cut from 1.35% to 1.10%. Its base rate, which was formerly the market leading unconditional rate, fell from 1.20% to 0.95%.

Meanwhile, ING introduced an additional interest-earning condition on its Savings Maximiser account. Now, to get the leading 1.35% bonus interest, savers will need to increase the balance in the account each month (not including interest). 

This is in addition to depositing at least $1,000 into a linked ING Orange Everyday account and making at least five settled transactions each month. These stacked conditions make it that little bit harder to get the most out of the savings account, whether you’re struggling to save money or simply forget to make the required deposits and transactions.

Big 4 loyalty despite big cuts

The trending gap between big four bank rates and the rest of the market has continued, with three out of the four (ANZ, NAB and CommBank) making multiple cuts to savings accounts last month. According to Mozo’s calculations, the average big bank savings rate is currently 0.16% – a substantial 25bp below the average of all other accounts.

Despite this widening gully, Mozo’s 2021 national savings report found more than half of Australians believe the major banks are the safest bet for their savings during uncertain economic times. 

While the savings rates show otherwise, 27% of people surveyed said they believed the big four offered more competitive options, and 44% said they banked with these players simply because “they always have”.

Data from the Australian Prudential Regulation Authority (APRA) shows 74.1% of Australia’s household deposits ($815 billion out of the total $1.099 trillion) are sitting in the big four banks.

If you’re considering parting ways with an uncompetitive savings account, check out some of the high interest options below.

Compare high interest savings accounts - last updated 16 October 2021

Search promoted savings accounts below or do a full Mozo database search. Advertiser disclosure
  • Boost Saver with Go Account
    Maximum rate
    standard interest rate
    Govt Deposit Guarantee
    1.50% p.a. (for $0 to $250,000)
    0.10% p.a.(for $0 and over)
    Yes up to $250,000

    Intro bonus rate of 1.50% for first 3 months, reverting to 1.20% after. Deposit $2,000 each month and make 5 eligible payments from your Go Account. If you are between 18 and 25 deposit $1,000.

    Enjoy a savings account bundled with a spending account. No monthly fees. New customers can earn up to 5000 bonus Virgin Money points on purchases (conditions apply). Benefit together with a joint account

    Details
  • High Interest Savings Account
    Maximum rate
    standard interest rate
    Govt Deposit Guarantee
    1.35% p.a. (for $0 to $250,001)
    0.25% p.a.(for $0 to $250,001)
    Yes up to $250,000

    Bonus rate for the first 4 months from account opening

    Kick start your savings with the 4 month introductory variable rate. No fees, no minimum balance, no minimum monthly deposit and no minimum term.

    Details
  • Grow Saver
    Maximum rate
    standard interest rate
    Govt Deposit Guarantee
    0.65% p.a. (for $0 and over)
    0.10% p.a.(for $0 and over)
    Yes up to $250,000

    Make at least 1 deposit and no more than 1 withdrawal, including internal transfers or external payments.

    Earn a maximum interest rate of 0.65% per year. Pay no monthly fees. Set up in-app savings goals. Benefit with joint account options.

    Details
  • Online Saver
    Maximum rate
    standard interest rate
    Govt Deposit Guarantee
    1.10% p.a. (for $0 to $500,000)
    0.35% p.a.(for $0 and over)
    Yes up to $250,000

    Bonus rate for the first 4 months from account opening

    No account keeping fees. No minimum balance required. Unlimited phone and internet transactions.

    Details
  • Fast Track Starter Account
    Maximum rate
    standard interest rate
    Govt Deposit Guarantee
    2.50% p.a. (for $1 to $10,000)
    0.05% p.a.(for $1 and over)
    Yes up to $250,000

    Ongoing bonus rate applied and 5 eligible transactions are made by the linked accountif in the previous month $200 or more is credited to the linked Day2Day Plus account.

    3.00 %P.A. Bonus Interest on balances up to $10,000 when the Bonus Criteria is met. Free withdrawals to your linked Day2Day Account while still earning Bonus Interest. Only available between the ages of 14 - 24 years.

    Details
  • Fast Track Saver Account
    Maximum rate
    standard interest rate
    Govt Deposit Guarantee
    1.05% p.a. (for $1 to $250,000)
    0.05% p.a.(for $1 and over)
    Yes up to $250,000

    Ongoing bonus rate applied if in the previous month $1,000 or more is credited to the linked Day2Day Plus account and 5 eligible transactions are made by the linked account.

    Earn 1.05% p.a. Bonus Interest in the following month on your Fast Track Saver Account balance. Earn Bonus Interest on your savings, with no minimum balance required.

    Details

^See information about the Mozo Experts Choice Savings Account Awards

Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.