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Which banks are scrapping their cashback offers? And who is still offering them?
When mortgage interest rates are rising, many borrowers look for alternative ways to get value for money from their home loan. Cashback deals are one way that many mortgage lenders compete for customers in a rising rate environment, but record refinancing activity is leading some leading banks to pull their cashback offers.
How do home loan cashbacks work?
Cashback deals are special home loan offers where the lender pays the borrower a sum of cash (often between $2000 and $5000), when they successfully settle a home loan with them.
These deals are often targeted at customers refinancing their mortgages from other lenders, with the cashback intended to offset some of their switching costs, such as upfront and outgoing fees, solicitors’ fees, stamp duty, and so on.
Which banks have scrapped their cashback deals?
In May 2023, the Commonwealth Bank of Australia announced that it would be discontinuing its $2000 cashback offer from 1 June. Just a few days later, NAB announced it would be discontinuing its own $2000 cashback after 30 June 2023. By the end of the month, Bankwest announced its $2000 cashback would also end 31 May, and Westpac announced it would be ending its $3500 cashback, and ING would also be ending its $3000 cashback, both from 30 June. And in August 2023, it was announced that ANZ would be halving its cashback deal from $4000 to $2000 as of 26 August 2023.
The discontinuation of these offers came on the heels of a record $21 billion worth of home loan refinancing in March 2023. In June 2023, a total $266.96 billion worth of loans have been refinanced since May 2022, when the current rate hiking cycle began. These refinancing volumes could likely make offering discounts and cashbacks an expensive exercise for the banks.
RateCity research director, Sally Tindall, said that cashback deals are “dropping like flies” due to the current market churn putting pressure on the banks’ profit margins.
“While there’s still a handful of banks holding on to these sweeteners, customers can’t expect them to last forever. Borrowers hoping to maximise a refinancing deal with a cashback hit should consider making the move soon – but be smart about it. Households looking for long term relief are likely to be better off looking for an ultra-low rate and haggling with their new bank to waive any associated fees.”
Which banks are still offering cashback deals?
While cashback offers have proven to be tempting for many refinancers (and a few first home buyers), it’s important to look beyond the deals on offer and to carefully consider the overall value of each home loan. Looking at the interest rates, fees, features and benefits can help you compare home loan deals and find the best option to suit your needs.
List of lenders still offering home loan cashback deals at March 2023 vs August 2023
| Max cashback | ||
| Lender | Mar 23 | Aug 23 |
| AMP | $4,000 | GONE |
| ANZ | $4,000 | $2,000 |
| Bank of China | $3,000 | $4,288 |
| Bank of Melbourne | $4,000 | $2,000 |
| Bank of Queensland | $3,000 | $3,000 |
| BankSA | $4,000 | $2,000 |
| BankVic | $4,000 | GONE |
| Bankwest | $3,000 | GONE |
| bcu | $4,000 | GONE |
| CBA | $2,000 | GONE |
| Credit Union SA | $2,500 | GONE |
| Defence Bank | $4,000 | GONE |
| Geelong Bank | $2,000 | GONE |
| Great Southern Bank | $3,000 | GONE |
| Greater Bank | $4,000 | GONE |
| Heritage Bank | $4,000 | GONE |
| HSBC | $3,288 | $3,288 |
| imb bank | $3,000 | $3,000 |
| ING | $3,000 | GONE |
| LCU | $1,500 | GONE |
| Loans.com.au* | N/A | $4,000 |
| ME Bank | $4,000 | $4,000 |
| MyState Bank | $3,000 | GONE |
| NAB | $2,000 | GONE |
| Newcastle Permanent | $3,000 | GONE |
| People's Choice | $4,000 | GONE |
| RAMS | $4,000 | $4,000 |
| Reduce Home Loans | $10,000 | $10,000 |
| Regional Australia Bank | $2,000 | GONE |
| St. George Bank | $4,000 | $2,000 |
| Summerland Credit Union | $3,000 | GONE |
| Suncorp Bank | $4,000 | GONE |
| ubank | $5,000 | GONE |
| Westpac | $3,500 | GONE |
| P&N Bank | $2,000 | GONE |
Source: RateCity.com.au. *Note: loans.com.au cashback offer only available through comparison websites.
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Product database updated 05 Nov, 2024
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