ANZ and NAB have cut the rates today to 0.15 and 0.11 per cent, respectively, following introductory rates.
Canstar’s finance expert, Steve Mickenbecker, believes investors can shop around to find a better deal as some providers are still offering around 2 per cent on savings accounts.
“The introductory rate of 1.95 per cent on offer from ANZ and 2.11 per cent from NAB may sound appealing enough, but savers have to be aware the honeymoon is over after a few short months to be replaced with the reality of a 0.15 per cent or 0.11 per cent interest rate,” said Mr Mickenbecker.
“All four of the major banks reduced their online savings rates to 0.30 per cent in the aftermath of the June cash rate cut. There’s now an expectation that the other two banks will follow ANZ and NAB’s lead with similar cuts,” continued Mr Mickenbecker.
How low can it go?
Australia is facing the prospect of zero rates for savers, which would mean savers are paying the banks to hold cash reserves, according to Mr Mickenbecker.
“There are plenty of zero rates around the world and you think people are going to pay you to have money sitting in their vaults?” said Mr Mickenbecker.
“But apparently the wheels haven’t fallen off in Japan and some European countries when they have gone to zero rates, so it can happen,” continued Mr Mickenbecker.