Dropping like flies: NAB joins growing list of banks cutting savings rates

Australia’s third largest bank, NAB, has today cut rates on a range of savings, retirement and term deposit accounts.

NAB is the 30th bank to drop savings rates following the November 3 RBA rate cut. It’s also the third big four bank to cut savings rates in the space of a week, according to the RateCity.com.au database.

NAB Reward Saver

At least one deposit and no withdrawals per mth for max rate.

NAB iSaver

NAB Reward Saver – change in interest earned, 1 January 2020 to today

Someone with $50,000 in a NAB Reward Saver account was getting a max rate of 1.61 per cent at the start of the year, earning approximately $67 a month in interest. Today someone with the same balance would get a max rate of just 0.55 per cent and earn approximately $23 a month.

Note: assumes mthly conditions are met for max rate. Interest is calculated on an average mth.

RateCity.com.au research director, Sally Tindall, said: “Savings rates are dropping like flies. Thirty lenders have already cut rates with plenty more banks set to follow.”

“The big question now is how long will Westpac hold out, and will they cut their market-leading savings rate for young Australians?” she said.

“Westpac is currently offering 3 per cent for people aged between 18 and 29, although in the current climate, a rate like this has got to have a target on its back.

“Savers have to be on their toes if they want to keep their interest rate competitive. This typically means jumping through hoops to qualify for bonus interest each month, or bouncing from bank to bank chasing introductory rates,” she said.

Big four banks conditional savings rates

Source: RateCity.com.au. Note rates are for balances under $50K.

Big four bank: standard savings rates

Source: RateCity.com.au

Highest ongoing savings rates (excludes accounts specifically for younger Australians)

Source: RateCity.com.au 

Compare savings accounts