NAB adds to savings account woes while neobanks hit their stride

In a surprise move announced yesterday and implemented today, NAB has reduced interest rates on two popular savings accounts by up to 0.15%

NAB cut the maximum interest rate available on its iSaver account from 1.70% to 1.55% (-0.15%), while the maximum rate on offer with the Reward Saver account was reduced from 1.61% to 1.50% (-0.11%). 

Today’s cuts were the fifth time the major bank has reduced interest rates on both savings accounts in the past year, with Mozo Banking Expert, Peter Marshall, surprised by NAB’s decision.  

“It’s unusual for a change to be coming through right at the moment. It's been a long time since the last RBA rate cut and while there could be another in a couple of weeks when we get to the February meeting, that’s far from a certainty,” he said. 

“So why they’d be chopping any key savings rates right now is very surprising.”

In comparison to the ongoing savings account rates offered by the rest of the Big Four, the NAB Rewards Saver account is now the third highest, sitting behind Westpac’s Life account (1.65%) and ANZ’s Progress Saver account (1.60%), but well ahead of the Commonwealth Bank’s Goal Saver (0.90%). 

For perspective, the average ongoing savings account rate in the Mozo database which includes both ongoing account rates with (e.g. minimum deposits) and without conditions currently sits at just 0.98%

Neobanks take poll position 

While NAB were preparing to drop savings rates yesterday, one of the newest banking players in Australia were in the process of launching a brand new savings account with one of the highest interest rates currently on the market. 

Offering an ongoing rate of 2.25% for balances up to $245,000, the Stash savings account from neobank Xinja immediately claimed the position of equal-highest ongoing interest rate in the Mozo database. 

As the table below shows, Xinja’s new account shares that position with two other neobanks: the Up Saver Account (2.25% for balances up to $50,00) and the 86 400 Save Account (2.25% for balances up to $100,000). 

Highest ongoing savings account rates in the Mozo database (16/01/2020)

Interest RateConditions*
Xinja - Stash2.25% (Up to $245k)No
86 400 - Save Account2.25% (Up to $100k)Yes
Up - Saver Account2.25% (Up to $50k)Yes
Volt - Savings Account2.15% (Up to $245k)No
BOQ - Fast Track Saver2.15% (Up to $250k)Yes

However, unlike the accounts from Up and 86 400, the Xinja Stash account has no minimum requirements for savers to meet.

In that respect, along with the rate on offer, Xinja’s offer is similar to the account revealed by neobank Volt Bank last month. Once it fully launches in February, the Volt Savings Account will feature a 2.15% with no strings attached.   

As Marshall explains, a savers ability to meet any rate requirements attached to their account can potentially have a sizeable impact on the interest rate they’re getting. 

“For a while now banks have been offering ongoing bonus rates as their prime rates to reward people for doing things like depositing their salary or using their bank account regularly - really as a way to build that relationship,” he said.

“It’s a bit of a carrot and stick relationship where the carrot’s a great rate, but the stick, which is easy to lose sight of, is that if you fail to meet those conditions then you get hit with an extremely low rate.” 

“That’s why it’s really great to see some of the newer players coming into the market without those kinds of arrangement and really just saying to savers that if you put your money with us, you're going to get that great rate month in, month out.” 

RELATED: Neobank Volt has released its savings account rate and it could be a ‘game changer’

Ready to ditch your current savings account in favour of something more rewarding? Start your search by checking out some of the hot offers below, or take a trip to our handy savings account comparison tables for an even wider range of offers. 

*Check out the linked reviews for full information about any conditions required to meet the maximum interest rate on offer.

Compare savings accounts - last updated 30 May 2024

Search promoted savings accounts below or do a full Mozo database search. Advertiser disclosure
  • Mozo Expert Choice Badge
    High Interest Savings Account

    5.75% p.a. (for $0 to $250,001)

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    Competitive introductory variable rate for first 4 months (on deposits up to $250,000). No account keeping fees to pay. Multiple 2023 Mozo Experts Choice Award winner.

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  • High Interest Save Account

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    0.10% p.a.(for $0 and over)

    Yes up to $250,000

    Deposit at least $200 to either Spend, Bills or Save account from an external source each month.

    No monthly fees on any of your save accounts. Split your money with up to 10 Save accounts. Set savings targets and track the progress of all your Save accounts. Deposits guaranteed up to $250K per customer.

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  • 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.

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  • 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.

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^See information about the Mozo Experts Choice Savings Account Awards

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