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 18 September 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
  • Mozo Expert Choice Badge
    Bonus Saver Account
    Maximum rate
    standard interest rate
    Govt Deposit Guarantee
    1.10% 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 Everyday or Glide transaction accounts.

    Winner of a Mozo Experts Choice Award 2021 in the Regular Saver category. No monthly account fees and no minimum balance requirements.

    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
  • 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
  • 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
  • WebSavings Account
    Maximum rate
    standard interest rate
    Govt Deposit Guarantee
    1.00% p.a. (for $2,000 and over)
    0.05% p.a.(for $2,000 and over)
    Yes up to $250,000

    Bonus rate for the first 4 months from account opening on balances over $2,000 only, available to new customers only.

    A high interest savings account that still lets you access your cash, no monthly account keeping fees and top up as many times as you like.

    Details
  • Savings Maximiser
    Maximum rate
    standard interest rate
    Govt Deposit Guarantee
    1.35% p.a. (for $0 to $100,000)
    0.05% p.a.(for $0 and over)
    Yes up to $250,000

    For customers who have an Orange Everyday and in each month deposit at least $1,000 into a personal ING account, make at least 5 settled card purchases using the linked ING debit card and grow the account balance.

    No ING fees. Great variable rate every month when you grow your balance each month in addition to other eligibility criteria.

    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

^See information about the Mozo Experts Choice Savings Account Awards

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