Interest rates drop for savers

by Maya Breen20 Feb 2015
Nine providers, among them three major banks, have dropped savings account rates since the RBA rate cut.

Finder.com.au, one of Australia's biggest comparison websites, is urging savers to keep track of rates and to expect cuts.

Michelle Hutchison, Money Expert at finder.com.au, said, "Savers will have to work harder than ever this year, as savings account interest rates are already starting to take a dive, following the Reserve Bank cash rate drop on February 3, 2015.”

"In fact, we've seen nine providers including three of the four major banks drop interest rates on some of their savings accounts since the cash rate cut, with some by more than the Reserve Bank's 0.25 percentage points according to finder.com.au.

UBank and NAB dropped their savings accounts by 0.25 percentage points on Wednesday and Commonwealth Bank's Goal Saver Account bonus interest also dropped the same on February 12.

Citibank dropped its Ultimate Business Saver the most, by 0.35 percentage points on February 15 and ME Bank First Home Saver Account dropped 0.25 percentage points on February 12.

ANZ Online Saver and Progress Saver both dropped by 0.25 percentage points, with ING Direct Savings Accelerator and ME Bank Online Savings Account dropping their base rates by 0.25 percentage points, all on February 7.

RaboDirect and People’s Choice are also among those that have dropped rates for certain savings accounts. 

Hutchison said many of the savings account rates had fallen before lenders had passed on rate cuts to their lending products like home loans and personal loans.

"It's also interesting to see that these lenders have missed off any announcements about the bad news for savers of dropping their savings account rates but happy to announce the good news for lenders with dropping variable rate home loans,” Hutchison said. 

"Financial institutions shouldn't feel like they can't disclose these rate changes like they do with their variable home loan announcements.”

33 lenders have announced variable home loan rate cuts so far, with 29 of those effective between February 20 and 27.
 

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