Most Australians use transaction accounts for everyday banking. However, financial comparison data shows that sticking with the same account for years can come at a cost. Although convenient, these accounts often offer no interest and charge unnecessary monthly fees, which can add up over time.
Transaction accounts are the most common banking product in Australia, with 95% of people holding one and nearly 30% keeping the same account for more than 20 years. In 2024, most major banks in Australia offer no interest on transaction accounts. Some also continue to charge monthly fees unless certain requirements, such as minimum deposits, are met.
A review of the top 10 banks by household deposits highlights how inconsistent the returns are. Only Macquarie (2%) and Suncorp (0.01%) offer interest on transaction account balances. Three of the big four banks still charge monthly fees, up to $5, unless customers meet set deposit conditions. These fees can often be avoided, but doing so requires effort that many people do not realise is necessary.
Remaining loyal to a bank might seem harmless, but the reality is often different. When customers use the same bank for other financial services such as credit cards or home loans, they might overlook better deals offered elsewhere. Experts warn that staying with the same provider out of habit or forgetfulness could cost thousands over time. Fee-free options and higher interest rates are often easily accessible with other providers.
Three common mistakes are costing people money. First, paying account-keeping fees unnecessarily when free options are available. Second, leaving large balances in accounts that earn no interest instead of transferring them to accounts that earn interest or help offset a loan. Third, failing to regularly check direct debits and account conditions, which can lead to fees for unused services or hidden charges like overseas transaction fees.
Banks are becoming more competitive by offering rewards and international features such as travel perks and lower fees on everyday card use. However, without reviewing your banking setup, it is unlikely you will benefit from these offers. In today’s digital era, leaving your account on autopilot could end up being a costly mistake.
