Ahead of the Reserve Bank's cash rate decision next month, ANZ has preemptively cut the interest rate on its popular Online Saver account. 

The base rate has been lowered from 0.10% p.a. to just 0.05% p.a. - the worst of the big four - taking the total rate on the account (including the 3-month introductory bonus rate of 1.5% p.a.) down to 1.55% p.a.

This means that after three months of holding the account, ANZ savers would only earn 0.05% p.a. which is the worst ongoing savings account rate of any of the big four. 

An ANZ spokesperson told Savings.com.au their rates remain "competitive".

“We regularly review our rates and look to balance the needs of our customers whenever we make any changes, while remaining competitive.”

Compare that with some of the interest rates being offered by neobanks like Xinja, who currently offer the highest non-introductory savings account interest rate on the market at 2.25% p.a. for their newly launched 'Stash' product.

Xinja has already attracted more than $30 million flowing into its Stash savings account, despite only launching one week ago. 

Xinja Bank founder and CEO Eric Wilson described it as a "ripper response" and said the feedback from customers showed how much support there is for a new way of banking.

"We're committed to the long game of staying lean and reducing costs and overheads to do the best by our customers," Mr Wilson said.

"Having happy customers will go a long way to helping us break the high-cost, high profit model of Australian banking."

The table below displays a snapshot of some of the highest non-introductory interest rates on the market. 

Rates
Features
Conditions
Other
Provider
000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
*Rate varies on savings amount
  • Deposit $500 per month to get bonus interest
  • 5.50% p.a. available on total savings up to $100k.
  • 5.00% p.a. applies to savings between $100k-250K.
  • Tiered bonus rates apply. (TMDs at ubank.com.au)
*Rate varies on savings amount

Save Account (<$100,000)

  • Deposit $500 per month to get bonus interest
  • 5.50% p.a. available on total savings up to $100k.
  • 5.00% p.a. applies to savings between $100k-250K.
  • Tiered bonus rates apply. (TMDs at ubank.com.au)
More details
010000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
  • Deposit at least $1,000+ each month from an external source
  • Make 5 or more eligible transactions
  • Grow your savings balance each month

Savings Maximiser (<$100k)

  • Deposit at least $1,000+ each month from an external source
  • Make 5 or more eligible transactions
  • Grow your savings balance each month
More details
010000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

Boost Saver

    More details
    Important Information and Comparison Rate Warning

    All products with a link to a product provider’s website have a commercial marketing relationship between us and these providers. These products may appear prominently and first within the search tables regardless of their attributes and may include products marked as promoted, featured or sponsored. The link to a product provider’s website will allow you to get more information or apply for the product. By de-selecting “Show online partners only” additional non-commercialised products may be displayed and re-sorted at the top of the table. For more information on how we’ve selected these “Sponsored”, “Featured” and “Promoted” products, the products we compare, how we make money, and other important information about our service, please click here. Rates correct as of July 27, 2024. View disclaimer.

    The move from ANZ follows in the footsteps of NAB, who just last week cut their savings account interest rates on its popular iSaver and Reward Saver accounts. 

    The out of cycle savings account rate cuts could suggest the banks are getting ready for a potential cash rate cut by the RBA when they meet for the first time this year in February.

    Currently, the markets are tipping the chance of an interest rate cut at almost 60%, with many economists believing the cash rate could fall as low as 0.25% by the year's end. 

    The chances of a cash rate cut next month hinge on the unemployment figures, to be released later today.

    ANZ has also today cut home loan rates on its Simplicity Plus (loan-to-value ratio of at least 80%) product from 3.24% p.a. to 3.12% p.a.

    The bank also reduced its Simplicity Plus home loan for borrowers with an LVR of over 80% from 3.58% p.a. to 3.38% p.a. 

    Many of ANZ's term deposit rates have also today been slashed by up to 10 basis points. Its best term deposit rate is currently 1.15% p.a. for a standard five-year term deposit.