Banking in Australia really isn’t that different to banking anywhere else in the world. It helps however to have an idea of what you are looking for before shopping around for your first Australian Bank Account.
There are currently over 20 banks in Australia with the ‘big four’ being the Australian New Zealand Bank (ANZ), the National Australia Bank (NAB), the Commonwealth Bank of Australia (CBA) and Westpac (websites for these are listed below).
There are many websites offering to set up your Australian bank account for a fee of $50 or more, however if you do a little digging, you’ll discover that most banks will allow you to set up your account remotely (even when abroad). You can then pick up your ATM card and PIN in the local branch of your bank once you arrive in Australia.
Most banks will provide your ATM card/PIN within 5 working days of you opening your account so factor this lead time in making sure you have at least a couple of weeks’ worth of funds to allow you sufficient time to get yourself sorted when you arrive in Australia.
When finalising your account details in the Branch (and picking up your card), you’ll need 100 points of ID to open your account. This is satisfied by showing both your passport and drivers licence (some of the banks only require your passport if you’re opening your account within six weeks of your arrival in Australia).
Factors to consider when banking in Australia – Choosing your Australian bank account
Choosing your bank is a big commitment which you’ll likely not want to change to frequently. With this in mind make sure you do some shopping around.
Compared to banks in other parts of the world, Australian banks have a number of ‘features’ that may be surprising to some.
Australian Bank Fees
Firstly, many banks charge a monthly account maintenance fee just for the privilege of holding an account with them. Fee free transaction or current accounts are available although to qualify for a fee free account you typically have to transfer a minimal amount (say $2000) into your account each and every month.
It’s worth noting that the interest paid on fee free accounts is usually a lot lower than the interest paid on the accounts on where a monthly account maintenance fee is payable. If you’re likely to have a lot more than $2000 paid into your account each month, it may make sense to pay the small monthly fee to earn the additional interest payable on your account. The monthly fee is often also used to offset ATM fee’s which are often payable when using some of the cheaper accounts (see below).
Australian Banks ATM network:
Most Australian banks charge a fee of $2 if you use a different bank’s ATM card in their machines.
At time of writing, the Commonwealth bank offers the highest number of ATMs in the country. However check the ATM locators on the bank’s website to see if there’s an ATM located where you’re likely to be making the most withdrawals.
Foreign transaction fees
Are you likely to use your ATM card from outside of Australia? If so keep in mind that foreign withdrawal fees are expensive relative to many of the other banks around the world.
Current fees charged by each of the big four banks (as of July 2013) are listed below however please note that these can change on an almost daily basis so please do your own research before choosing your account.
Charges listed are for that bank’s basic account; some of the banks offer other accounts with lower foreign transaction/withdrawal fees, but these are all subject to higher monthly account fees. Accounts with limited free electronic transactions are also excluded.
Australian Current / Transaction Account Basic Account Fee Comparison
* Commonwealth Bank accounts are fee free if you deposit $2k per month ($1k if you’re 21-24 & no fee if you’re under 21)
** Westpac Choice account is fee free if you deposit $2k per month ^ Commonwealth Bank’s Smart Access account does not include in branch transactions (an additional $2 per transactions).
Australian Savings Accounts
Most banks will offer to set up a savings account when you’re opening your current account.
Current accounts generally pay minimal interest, especially the basic low fee/fee-free ones.
Online savings accounts, on the other hand, are currently paying approximately 4.5-6%. Current rates for savings accounts linked to the current accounts listed earlier are below*:
* Several other financial institutions may offer better rates than the above; these accounts are listed because they’re linked to the current accounts mentioned, and they have no minimum balance requirements or limitations on withdrawals.
Home pages for the big 4 banks: