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Written By
Sean Callery
Reviewed by
Shaun McGowan
Last updated21 January 2025
Compare term deposit rates up to 5.15% p.a. from authorised deposit-taking institutions (ADIs). See your best rates on term deposits from one month to five years.
Written By
Sean Callery
Reviewed by
Shaun McGowan
Last updated21 January 2025
Compare term deposit rates up to 5.15% p.a. from authorised deposit-taking institutions (ADIs). See your best rates on term deposits from one month to five years.
Deposit amount Duration Interest Frequency | |||
| Term duration | Highest rate with interest paid at maturity | Highest rate with interest paid monthly |
|---|---|---|
3 months | 5.00% p.a. from AMP Bank | 4.85% p.a. from BCU Bank (55+) |
6 months | 5.15% p.a. from AMP Bank | 4.95% p.a. from Qudos Bank |
9 months | 5.05% p.a. from AMP Bank, Bank of Sydney or Heartland Bank | 4.95% p.a. from Police Bank |
12 months | 5.00% p.a. from Heartland Bank | 4.90% p.a. from Illawarra Credit Union |
2 years | 4.70% p.a. from Judo Bank or Qudos Bank | 4.70% p.a. from Qudos Bank |
3 years | 4.60% p.a. from Judo Bank | 4.50% p.a. from Judo Bank or Qudos Bank |
4 years | 4.50% p.a. from Judo Bank | 4.40% p.a. from Judo Bank |
5 years | 4.50% p.a. from Judo Bank | 4.40% p.a. from Judo Bank |
Sean Callery, Editor
Term deposit rates in Australia are beginning to trend lower on average, as expectations rise that the Reserve Bank of Australia will cut the cash rate sooner rather than later in 2025. But based on our analysis, the best term deposit rates still represent good value compared to savings account rates, particularly on terms from 6 - 12 months. Now could be a good time to compare your options and consider whether locking in a rate is right for you.
Sean Callery, Editor
How to choose the best term deposit option
Interest rate
The interest rate on a term deposit dictates what return you’ll get from your money. A lot of people simply prioritise finding the highest rate available, but there can be situations where a term deposit with a lower rate could be more suitable, based on other factors explained here.
The term
The interest rate you earn on a term deposit can vary massively based on the term duration – even on accounts from the same provider. Remember, you won’t be able to access the money in a term deposit during the term (without penalties applying) so choosing a suitable term is key.
Interest payment frequency
For some savers, how often you receive interest payments is particularly important. An example could be if you will rely on the interest payments as income for day-to-day living. Just bear in mind that term deposits paying interest more frequently often have a reduced interest rate.
Min and max deposit
Check how much the provider actually allows you to deposit, and whether the top interest rate only applies to deposits above a certain amount. Where there is a maximum deposit amount, check if that applies per customer or per account. You may be able to spread funds across multiple term deposit accounts.
Rules (and penalties) for early withdrawal
Ideally you will choose a term that matches your plans for the money deposited, but it’s worth checking what happens (and what it will cost you) if you need to withdraw the money early for any reason. A reduced interest rate and/or fees usually apply.
Authorised deposit-taking institutions
Make sure the term deposit you choose is offered by an authorised deposit-taking institution (ADI). Only deposits with these providers (up to $250k per customer per provider) are guaranteed by the Australian Government’s Financial Claim Scheme.
Reinvestment options
Some term deposits allow you to build on your savings by reinvesting the interest earned. Also consider what happens when the term ends and what options the provider offers. Some banks offer a loyalty bonus if you roll your deposit over into a new term.
Get advice if you’re unsure
Term deposits are generally considered to be lower risk than other investments, but you may still benefit from getting financial advice before deciding if investing in a term deposit is the right approach for you and which type of account will be best.
Term deposit
High interest savings account
How to open a term deposit
You can usually open a new term deposit account online through the provider’s website. This should only take a few minutes, assuming you’re eligible and have your ID handy.
To open a term deposit, you’ll generally need to:
How do term deposits work?
A term deposit is a savings product offered by most banks in Australia that pays a fixed rate of interest on money deposited for a set period of time.
During the term, savers cannot withdraw money from their term deposit without penalties applying (fees or interest deductions).
When is interest paid on a term deposit?
There are usually a few different options for when interest is paid on a term deposit:
For shorter terms (1-12 months) some providers only pay interest at the end of the term. Choosing to receive interest payments more frequently usually means you’ll be paid a lower rate of interest.
What happens if I need to access the money before the end of the term?
Most term deposit providers require a month’s notice is a customer needs to withdraw funds early. There may be exceptions for customers who need to access money because they are experiencing financial difficulty.
If you withdraw funds early, you may be charged a fee or, more likely, be paid a reduced rate of interest depending on how long is left until the term deposit matures.
If you are saving for a particular goal, such as a first home buyer saving for a deposit, it's particularly important to consider the term length and whether it suits your plans.
Here is an example of the interest rate deduction applied by term deposit provider, Rabobank.
| % of term that elapsed when funds withdrawn | Interest rate deduction |
|---|---|
Less than 20% | 80% |
20-39% | 60% |
40-59% | 40% |
60-79% | 20% |
80-99% | 10% |
What happens at the end of the term deposit term?
When your term deposit ends (matures), you generally have a few options depending on the provider:
Is my money safe in a term deposit?
Money saved in a term deposit with an authorised deposit-taking institution (ADI) is guaranteed by the Australian Government’s Financial Claim Scheme, up to a value of $250,000 per person per bank. That means no matter what happens to a bank, each customer with a term deposit will be protected up to $250,000.
If you have more than $250,000 to invest, you could spread your savings across multiple term deposit providers covered by the scheme to ensure you are protected. If you are investing a large amount, consider discussing your options with a financial advisor first.
You should also make sure that the product you’re investing in is in fact a term deposit. The Australian Securities and Investments Commission (ASIC) warns that there are cases where scammers advertise fake investments as being ‘like a term deposit’ with ‘guaranteed high returns’.
There may also be legitimate investment products (e.g. managed funds) that seem similar to what a term deposit offers, but these are much higher risk, ASIC warns.
Which banks in Australia offer term deposits?
The following providers are authorised deposit-taking institutions who can offer term deposits that will be covered by the government’s Financial Claims Scheme.
Sean Callery is the Editor of Money.com.au. He has over 15 years of international experience. He is qualified with a Certificate IV in Finance and Mortgage Broking (FNS40821) and is compliant to provide general advice in Tier 1 General Insurance (RG 146) products.
Shaun McGowan is the founder of Money.com.au. He's determined to help people and businesses pay as little as possible for financial products, through education and building world class technology. Previously Shaun co-founded CarLoans.com.au and Lend.
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Rates and other product information are updated daily. Our term deposit interest rate comparison is based on products analysed by Money from banks covered by the Government’s Financial Claims Scheme. By default the table is sorted by highest interest rate, then provider name alphabetically. Check with the provider for full current account details, including rates, fees, eligibility and terms and conditions – and seek financial advice if necessary – to ensure the product is right for you. While this is an extensive list of the highest term deposit rates based on monthly interest payment available in Australia, we don’t guarantee that all products in the market are shown.
