The Big Four Banks
Australia’s four largest banks—Commonwealth Bank (CBA), Westpac, ANZ, and NAB—dominate the market. They offer full-service banking: savings accounts, loan products, investment services, and branches nationwide. Big Four banks charge higher fees but offer extensive branch networks and customer support. Most employers transfer wages to these banks, and mortgages often flow through them.
Online and Challenger Banks
Newer online banks (Up, ING, Wise) offer lower fees, better interest rates, and mobile-first experiences. They have fewer physical branches—everything operates via app. These are ideal for tech-savvy users comfortable banking online. Many don’t offer loans or investment products, but for day-to-day banking and transfers, they’re competitive. Some online banks (ING) require you to meet criteria (direct deposit, card spend) to avoid monthly fees.
Savings Accounts and Interest
Standard savings accounts offer minimal interest (often 0.01–0.50% p.a.). High-interest savings accounts (linked to online banks or Big Four) pay 3–5% p.a. if you meet criteria: regular deposits, no withdrawals, or maintaining a minimum balance. Shop around—rates change monthly. Compare on rate aggregator sites before opening an account.
Transaction Accounts
A transaction account is your everyday spending account—debit cards, online transfers, bill payments. Big Four banks’ transaction accounts usually charge monthly fees (AUD 10–14). Online banks often offer free transaction accounts. Compare fee structures, ATM access, and overseas transaction rates before choosing.
Opening an Account as a Newcomer
You’ll need a valid passport, proof of Australian address (utility bill, lease, letter from accommodation), and your TFN (if you have one—some banks allow applications without TFN, issuing it later). Most Big Four banks allow in-branch applications; many online banks require online identity verification via video or government ID upload. Processing typically takes 1–3 business days.
Transferring Money Internationally
Use international transfer services for large transfers. Big Four banks charge high fees (AUD 10–50 plus unfavorable exchange rates). Specialist providers (Wise, OFX, Remitly) offer cheaper rates and better value. For ongoing international payments, set up a Wise account—it offers multi-currency holding and low fees.
FAQ
Q: Do I need a TFN to open a bank account? A: Most banks request it, but some will open accounts without one. You’ll need to provide it later for tax and superannuation.
Q: Are my deposits protected if the bank fails? A: Yes, the Financial Claims Scheme protects deposits up to AUD 250,000 per depositor per bank.
Q: Can I open an account online from overseas? A: Some online banks do; Big Four typically require arrival in Australia.
Q: What’s the cheapest way to send money home? A: Specialist providers like Wise offer rates 3–5x better than traditional banks.
Sources
- ASIC: Banking Services
- Reserve Bank of Australia: Financial System
- Australian Prudential Regulation Authority: Banking
- Services Australia: Financial Services
This article is informational only and not financial advice.