Commonwealth Bank drew attention after announcing that it will increase the introductory rate on its popular NetBank Saver; however, experts warn that there is a major catch.
CBA has increased the rate by 0.25 percent to 4.0 percent, the highest introductory rate of the big four banks, but it plummets to a current rate of 1.60 percent after five months.
The move is “out of step” with recent Reserve Bank rate hikes and an effort to attract new customers, according to Canstar Group financial services executive Steve Mickenbecker.
“CommBank’s savings rate hike out of cycle with the Reserve Bank’s rate hikes gives savers a long-awaited glimmer of hope,” he said.
“If the country’s largest bank is chasing savings, perhaps the worm is turning and savers could wait for their share of future increases. The banks have been awash in savings, but there was always going to come a time when they would have to start competing for deposits.”
It may be a good deal, but new customers should be aware of the 2.40 percent drop after the honeymoon period, according to RateCity research director Sally Tindall.
“At 4 percent, the new CBA introductory rate is designed to attract attention, but customers would do well to read the fine print,” he said.
“After five months, the rate hits rock bottom, an all-powerful warning that is likely to ensnare some customers.”
It’s the “prime time” for savers to start looking for the best deal to maximize their cash, according to Ms Tindall.
“If the bank isn’t willing to give you the new customer rate, then it might be time to take your hard-earned savings to a competitor who is willing to reward you,” he said.
Bank of Queensland’s Future Saver tops the list for the highest ongoing savings with a rate of 4.75 per cent, according to RateCity, followed by Virgin Money’s Boost Saver (4.60 per cent) and ING’s Savings Maximiser (4. 55 percent); however, all of these accounts come with monthly terms and conditions.
For those who don’t want to worry about monthly terms and conditions, ANZ and Bankwest top the list with a rate of 3.75 per cent.
Westpac’s Life account tops the list of major banks, with a rate of 3.75 percent, followed by GoalSaver from CBA and Reward Saver from NAB, which have a rate of 3.25 percent.
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