Australia’s biggest bank, CBA, has rolled out a new home loan incentive, offering up to 300,000 Qantas Frequent Flyer points for new customers taking out its lowest variable rate home loan.
The offer is available on the bank’s Digi Home Loan, which features a lowest advertised variable rate of 5.34% for owner-occupiers with a 40% deposit (comparison rate 5.47%).
The number of points depends on the loan size:
The catch? The points are only available on CBA’s digital-only mortgage, which is not available via a broker.
This move comes as lenders across Australia are shifting away from traditional cashback offers, which peaked in 2023, and are now experimenting with alternative sign-up perks to attract refinancers in a cooling but highly competitive market.
The shift reflects both regulatory scrutiny of cashbacks and the need for banks to differentiate their digital offerings as more borrowers seek direct, online solutions.
The launch comes as refinancing activity surges, spurred by this year’s cash rate cuts.
ABS Lending Indicator data shows $61.9 billion in mortgages were switched to a different lender in the June quarter – surpassing the previous peak in March 2023, when cashback incentives were at a record high.
“Refinancing just hit a new record high and so it’s no surprise Australia’s biggest bank is looking for new ways to capitalise on this resurgence,” said Sally Tindall (pictured), Canstar.com.au data insights director.
“CBA might have moved away from handing out cold hard cash, but it’s still hungry for new customers. This time, it’s dangling frequent flyer points to reel borrowers in.
“Interestingly, the lender is only offering the points on its digi-only home loan, in a move to push its direct-to-bank home loan offering.
“If this points-play pays off for CBA, we could see more lenders coming up with fresh new ways to stand out in a fiercely competitive refinancing market.”
Sign-up incentives can offer refinancers a financial sugar hit, but the long-term value depends on the interest rate, fees, loan term, and how the points are redeemed.
Canstar.com.au compared CBA’s Digi Home Loan at 5.34% with one of the lowest-rate loans in the market at 5.17%. For a $600,000 mortgage over 25 years, a borrower could be ahead in the first two years with CBA’s points, but after five years, the total cost could be $3,125 more than with the lower-rate loan.
“While hundreds of thousands of frequent flyer points can potentially fly you around the world, borrowers should think practically when refinancing their home loan because a flashy sign-up bonus can lose its shine in the longer term if the loan doesn’t suit your needs,” Tindall said.
“At 5.34%, the lowest rate on CBA’s Digi Home Loan is actually relatively competitive, however, if you’re someone whose primary objective is to pay less interest on your mortgage, know there’s more than 40 lenders offering sharper variable rates to owner-occupiers.
“Before you jump at a big points haul, do the maths. Make sure the value of the sign-up bonus isn’t wiped out by higher rates and fees before you’re next likely to refinance.
“However, if you haven’t refinanced or renegotiated your mortgage in a number of years, know that doing something is probably going to be better than doing absolutely nothing. Switching to a more competitively-priced loan has the potential to bring real relief into your budget, with or without a sign-up perk.”
Canstar.com.au research shows four lenders currently offer Qantas frequent flyer points with a home loan: CBA, Qantas Money, Qudos Bank, and La Trobe Financial. Meanwhile, 13 lenders still offer cash incentives, including ANZ.
CBA’s new points offer is only available direct, not through brokers, but the move signals intensifying competition for refinancers. Brokers should help clients weigh the real value of sign-up perks versus long-term savings and highlight sharper rates available in the broker channel.
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