Time to save? Term deposit rates are quietly on the rise

calculating which term deposit is best for me

In the last couple of months interest rates for term deposits have been increasing, in some cases by about 20 basis points. In January alone there were 47 increases recorded on Mozo’s database. 

If you aren’t too familiar with the world of finance, a term deposit is a bit like a savings account but once money goes in, it stays for a set period before you can take it out. Typically a term deposit is a safe place to stash your money while it earns interest during this time and as such, is seen as a low-risk investment.

As mentioned, the interest rates of term deposits have been steadily going up, especially for longer terms.

Mozo’s banking expert Peter Marshall believes this has to do with the Federal Reserve’s plan to lift the official cash rate this year. Many banks are already increasing their rates prior to the Reserve’s expected announcement. 

“Banks are also thinking they will need to start getting more deposit customers, so there’s some increasing competition there. I think that term deposit rates will be under the same pressure that fixed home loan rates are, and continue to creep steadily higher,” he says.

So let’s take a closer look at changing rates.

What are some notable term deposit increases?

In the last couple of months, rates for longer term deposits have seen big growths, some as big as 20 basis points. 

For example, Judo Bank also made a number of interest rate increases putting several of its term deposits in the top spots in the Mozo database.

Some of its current competitive rates are:

  • 1.15% p.a. for a six month term
  • 1.15% p.a. for a 1 year term
  • 1.45% p.a. for a 2 year term
  • 1.55% p.a. for a 3 year term
  • 1.85% p.a. for a 4 year term
  • 1.95% p.a. for a 5 year term

However, Judo Bank isn’t the only one increasing their rates. According to Mozo’s database some of the banks who have recently raised their rates include:

Term deposit comparisons on Mozo

Mozo may receive payment if you click the products below. We don’t compare the entire market, but you can search our database of 101 term deposits.
Last updated 21 July 2024 Important disclosures
  • Mozo Expert Choice Badge
    Term Deposit

    5.25% p.a.
    6 months

    $1,000

    Yes up to $250,000

    Great rates and incentives incl. 0.10% added loyalty bonus at renewal. Option to have interest paid to another bank. Winner of the Mozo Experts Choice Awards 2024^ for Term Deposits.

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    Details
  • Online Term Deposit

    5.00% p.a.
    1 year

    $5,000

    Yes up to $250,000

    No set-up or account keeping fees. Deposits up to $250,000 per customer are guaranteed by the Australian Government. Mozo Experts Choice winner for Term Deposit 2022.

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    Details
  • SMSF Term Deposit

    5.25% p.a.
    6 months

    $1,000

    Yes up to $250,000

    Apply digitally in minutes and manage your SMSF Term Deposit. Flexible cash flow management with three interest payment frequencies that suit you: monthly, yearly, or at maturity. Choose from terms of 3 months up to 5 years. No application or monthly account fees but eligibility criteria and terms and conditions apply. Only accessible to SMSFs with two or up to four individual trustees or one corporate trustee.

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    Details
  • Term Deposit

    3.70% p.a.
    6 months

    $5,000

    Yes up to $250,000

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    Details
  • Term Deposit

    4.25% p.a.
    1 year

    $5,000

    Yes up to $250,000

    No set up, monthly service or management fees & choose to invest from $5,000 or more

    Compare
    Details

* Different interest rates apply to different amounts or different interest payment frequencies.

^See information about the Mozo Experts Choice Term Deposit Awards

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