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Savings account interest rates: December 2019

By Peter Marshall ·


Since the RBA began cutting official interest rates back in June, banks have hacked an average of 0.56% off their range of savings accounts. Right now, the average savings account ongoing rate sits at 0.97%, which puts it well below the inflation rate of 1.70%. 

Last month saw a few cuts to savings rates, but they weren’t too large, and generally give the impression that we’ve hit a plateau. When the RBA next cuts official interest rates, savers probably won’t feel the full force, with banks more likely to reduce their savings rates by 0.10% to 0.15% than the full 0.25%.

Currently, there are still accounts out there that offer attractive rates — you’ll just have to look a little bit harder. Among the top 5 highest ongoing bonus interest rates in the market, four are online banks - Up, 86 400, UBank and ME Bank - with Bank of Queensland rounding out the list. All have interest rates between 2.05% p.a and 2.25% p.a., assuming all conditions are met.

Picture of Peter Marshall
Peter Marshall
Banking expert

Peter has been working in the Australian banking and finance industry for over 20 years and oversees Mozo’s extensive product database. He is regularly sought out for his expert commentary and analysis on banking and interest rates trends by print, radio and TV media.

Page last updated December 13, 2019

Latest savings account interest rates on Mozo - rates updated daily Mozo has robust processes to ensure our site is updated to reflect the latest information from providers. There may be the odd occasion where updates are delayed, so please confirm information before purchasing.

  • Promoted

    USaver with Ultra Transaction Account

    2.10% p.a. (for $0 to $200,000)

    Bonus interest only applies on funds held in linked USaver account if $200 deposited into either account in the month from an external source.

    1.04% p.a.(for $0 to $5,000,000)

    $0.00

    The UBank Ultra Transaction Account works hand in hand with the USaver. Receive a generous 2.10% ongoing bonus rate when you deposit at least $200 into either account each month. No international fees. Winner of the Mozo Experts Choice Awards 2019 as Savings Bank of the Year.

    • Bonus interest only applies on funds held in linked USaver account if $200 deposited into either account in the previous month from an external source and the combined balance is less than $200,000.

    • Phone banking, Internet banking

    • $0.00

    Read our Mozo Review to learn more about the USaver with Ultra Transaction Account

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  • Promoted

    Growth Saver Account

    1.95% p.a. (for $0 and over)

    Grow your balance by $200 or more and make no more than one withdrawal in the month.

    0.20% p.a.(for $0 and over)

    $0.00

    Earn bonus interest for every month that you grow your net balance by $200 or more (excluding interest) and make no more than one withdrawal. Ideal for helping you reach those long-term savings goals.

    • Grow your balance by $200 or more and make no more than one withdrawal in the month.

    • Branch access, Phone banking, Internet banking

    • $0.00

    Read our Mozo Review to learn more about the Growth Saver Account

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  • Promoted

    Online Saver

    2.30% p.a. (for $0 to $500,000)

    Bonus rate for the first 4 months from account opening

    0.85% p.a.(for $0 and over)

    $0.00

    Earn the variable introductory rate, currently 2.30% p.a., for the first 4 months while the account balance remains below $500,000 (interest rate may change throughout the period). At the end of the introductory period (or if your balance is $500,000 or more) you'll receive the 0.85% p.a. standard variable rate on the entire balance.

    • Bonus rate for the first 4 months from account opening

    • Phone banking, Internet banking

    • $0.00

    • Must link to a transaction account.

    Read our Mozo Review to learn more about the Online Saver

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  • Promoted

    Reward Saver Account

    2.00% p.a. (for $5,000 and over)

    Minimum deposit of $50 and no withdrawals. Reverts to bonus rate of 0.90% after the first 4 months.

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

    $0.00

    Earn bonus interest by saving as little as $50 a month with no withdrawals. No monthly account keeping fees.

    • Minimum deposit of $50 and no withdrawals. Reverts to bonus rate of 0.90% after the first 4 months.

    • ATM, EFTPOS, Visa Debit, Cheque book, BPay, Branch access, Phone banking, Internet banking, Bank@Post

    • $0.00

    Read our Mozo Review to learn more about the Reward Saver Account

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  • Promoted

    eSaver Flexi

    No Current Offer

    1.30% p.a.(for $0 and over)

    $0.00

    One simple competitive 1.30% rate of interest across all balances. Flexibility to add and withdraw money freely with no monthly interest conditions.

    • n/a

    • BPay, Phone banking, Internet banking

    • $0.00

    Read our Mozo Review to learn more about the eSaver Flexi

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  • Promoted

    Hero Saver

    1.85% p.a. (for $0 to $250,000)

    Minimum deposit of $200 excluding interest and no withdrawals in the month

    0.01% p.a.(for $0 to $5,000,000)

    $0.00

    $0 account maintenance and transaction fees and no minimum opening balance needed. Interest calculated daily and paid monthly.

    • Minimum deposit of $200 excluding interest and no withdrawals in the month

    • Phone banking, Internet banking

    • $0.00

    Read our Mozo Review to learn more about the Hero Saver

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  • Promoted

    Online Savings Account

    2.05% p.a. (for $0 to $250,000)

    Ongoing bonus rate if you make at least four tap & go™ payments per month with your Everyday Transaction Account debit card. Purchases must be processed in calendar month to be eligible for bonus interest.

    0.35% p.a.(for $0 and over)

    $0.00

    Receive the maximum saving rate for any month which you make at least four tap & go purchase with your ETA debit Mastercard, on balances up to $250,000. No monthly fees and no account keeping fees. Winner of Mozo Experts Choice Awards 2019 – Regular Saver.^

    • Ongoing bonus rate if you make at least four tap & go™ payments per month with your Everyday Transaction Account debit card. Purchases must be processed in calendar month to be eligible for bonus interest.

    • Internet banking

    • $0.00

    • Must link to a transaction account

    Read our Mozo Review to learn more about the Online Savings Account

    Details Close

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^See information about the Mozo Experts Choice Savings Accounts Awards

Savings account interest rates resources

Reviews, news, tips and guides to help find the best savings account for you.

What is a savings account?

A savings account is a low risk account where you can stash the savings that you don’t plan to use for daily expenses. Generally speaking, savings accounts usually require a low minimum balance, and are a good way to keep your money safe but still accessible.

How is my savings account interest calculated?

Most savings accounts calculate and compound interest daily. This means that the amount of interest you earn is constantly growing, and you can boost it by making regular deposits into your savings account. 

For example, if you have $1,000 in a savings account with an interest rate of 2.0% p.a., you’ll earn $20 in interest each year. If you were to add monthly deposits of $175, you could double your interest. Check out our savings calculator to work out what your interest rate is earning you.

Types of saving account interest rates

Different types of savings accounts will have different interest rates attached to them. Here are some of the popular types of savings accounts and what interest rate you might expect from them.

Online interest rates

For technology-savvy savers, online savings accounts are a great way to maximise your interest. Online banking cuts out overhead costs for the banks, which usually means higher interest rates and lower (if any) fees for you.

Introductory interest rates

Offered as incentive to open an account, introductory interest rates usually apply for a period of 3-6 months from the time when you open the account. Intro rates are usually very high, but remember to check the standard rate as well before you open an account, because after the initial introductory period your interest will go back to the standard rate. An account with a high introductory rate is perfect if you’re saving for a short term goal, like a new car or a shopping spree.

Bonus interest rates

These rates are offered as long as you meet certain conditions, usually something like a monthly minimum deposit or maximum withdrawal limit. Some only require you to make a certain amount of purchases each month using your linked everyday transaction account.

Bonus interest rates are higher than the account’s standard rate, sometimes by quite a bit, so it's worth checking out what you might have to do to be eligible. Knowing that your high interest rate may be conditional upon not withdrawing from your account is also a great motivator to stick to your budget!

Bonus interest rate criteria

Long term interest rates

If you want an account that you can leave your savings in for a longer period of time and you’re not interested in switching around to chase introductory or bonus rates, look for a savings account with a high standard interest rate. Take a look at Mozo’s long term savings account comparison to find out which bank is offering the best savings interest rates at the moment.

Kids saver interest rates

It’s never too early to introduce your kids to the importance of saving! You can start by opening a kids savings account. While these accounts generally don’t have any fees, and their introductory or bonus rates are competitive, these rates also often depend on conditions like a monthly minimum deposit. If you’re not sure that your child can meet the requirements, it's better to search for an account with a higher standard interest rate.

FAQs about savings account interest rates

We've covered what savings accounts are and the types of interest they offer, but there might still be one or two things you're in the dark about. Below, we've compiled a few key questions to put you on the right track to finding the perfect savings account.

How do interest rates affect my savings?

Like home loans and term deposits, savings account rates move in line with the cash rate. When the Reserve Bank reduces official interest rates, banks are usually quick to cut their savings rates in kind. If, however, the RBA was to raise official interest rates, you can generally expect much more attractive returns on your savings.

What should I look for in a savings account?

There are a few key features to keep in mind when you’re shopping around for a competitive savings account. While securing the highest possible interest rate might seem like the most important thing, it can sometimes be a bit trickier than that. Keep an eye on these things when choosing a savings account:

  • High ongoing interest rate: When you compare savings accounts on the Mozo website, you’ll see special and standard interest rates. The high special rates are always very tempting, but it’s important to remember that these rates often don’t last more than a few months, or may be reliant on conditions that you can’t meet. That’s why it's important to look at the standard interest rate and make sure it is also competitive.
  • High introductory rate: A savings account with a high introductory interest rate is a great way to boost your savings. This is great because it isn’t reliant on withdrawal or deposit requirements - all you need to do is open the account.
  • Compulsory linked accounts: Some savings accounts, especially online ones, will require you to have a linked transactions account so you can transfer money to and from the savings account. Make sure that you’re not paying extra fees or charges with this account, or all your hard earned interest may not mean much.
  • Extra fees and charges: These days, most online banking is fee free, but make sure you’re not paying annual account fees or transaction fees. When you’re trying to maximise your savings, a high interest rate may not mean much if you’re paying extra fees on the account.
  • Monthly deposit requirements: Sometimes your interest rate will depend on you maintaining a minimum monthly balance or making a minimum monthly deposit. If you can’t do so, some banks will lower your interest rate for the month, or maybe not pay interest at all. So before you choose a savings account, it's a good idea to look closely at your budget and choose an account with conditions you can meet each month.
  • Withdrawal conditions: Your savings account is designed as a place to park your money and leave it there. That means there could be conditions or penalties for making withdrawals from it. Some accounts might not pay interest for the month in which you made a withdrawal, although some will allow one withdrawal without penalty. So if you can, leave your savings account alone, and check out a competitive transaction account instead.

How can I earn the most interest with my savings account?

If you’re looking to maximise your savings, earning interest is one of the easiest and low-risk ways to do it. Use some of these handy tips to help you make the most of your savings account interest rate.

  • Get online: Online banking is easy and efficient, and you can do it wherever and whenever you need to. Even better, online accounts usually come with no fees and high interest rates. If you don’t need to have branch access and are happy to manage your savings from the comfort of your own lounge chair, an account with an online provider is competitive and convenient.
  • Switch accounts regularly: You can take advantage of high introductory interest rates by switching accounts regularly. Most introductory periods last between 3 and 6 months, so when one runs out, you can close the account and open a different one. This can be a time consuming process and can be more of a hassle than it’s worth for some people, but one of the benefits of online banking is that it’s easier than ever to switch bank accounts.

How do I compare savings account interest rates?

You need to take a lot of things into account when choosing the right savings account for you: bonus and introductory interest rates, ongoing interest rates, fees and conditions. You’ll also need to know what kind of deposits your budget allows for and how you want to use your account. It can all seem a little overwhelming, so here at Mozo, we’ve taken some of the hard work out of it for you with these handy resources:

  • Savings account comparison page - check out all the latest interest rates available on savings account from a range of providers and choose the one that suits you best.
  • Savings account guides - we’ve got guides that cover all the important details you’ll need to know about when setting up a savings account that will earn you the most interest.
  • Reviews of savings accounts - there’s nothing better than first hand experience! Read reviews from customers on their savings accounts experiences.

You can also find out more about interest rates, how they work and what they mean for you by visiting our interest rate guides pages.