Types of bank accounts in Australia

Everyday banking or transactional accounts 

Everyday banking or transactional accounts are designed for day-day-day banking with ready access to your money. In other countries, they may be called a checking account or current account. 

Transaction accounts are likely to be the account you use to make direct deposits into, pay bills online, withdraw cash and, if you’re working, it’s usually the account your employer pays your salary into. 

Some everyday accounts may earn interest, but the interest rate is usually lower than you’d earn with a savings account.

Westpac Choice is an everyday account that may be suitable for people who have recently arrived in Australia. If you've arrived here within the last 12 months, and choose to open a Choice account, you'll pay no monthly account-keeping fee for your first year (usually $5 a month). After that, the monthly fee will continue to be waived if you meet certain criteria, such as minimum monthly deposits (i.e., $2,000 per month). Other fees and charges may apply, so be sure to check out the terms and conditions.

As a Westpac Choice everyday bank account holder, you’ll receive a linked Debit Card to access your money at ATMs, or to shop online and in-store. We won’t charge you ATM fes to withdraw cash at any major bank ATM in Australia (including Westpac, St.George, Bank of Melbourne and BankSA). ATM providers may, however, charge a fee for withdrawals.

Once you arrive in Australia, you can open a Westpac Choice account online or in a local branch in just a few minutes. If you open online, you may still be required to visit a branch to verify your ID.

For a list of documents that we accept, refer to Identification Checklist.

Savings accounts

There are a few different types of savings accounts, but generally a savings account is for money you don’t plan to spend immediately. A savings account allows you to deposit money and earn interest on the balance.

Savings accounts typically earn a higher interest rate than everyday accounts. They provide a convenient way to manage your money – usually online – and to save for a future goal. 

Savings accounts come in various forms, with different levels of access to your money – they usually don’t have a linked Debit Card to access your cash at ATMs. 

To save you time, if you want a Westpac transaction account for your everyday banking, plus a separate account for your savings, you can open both accounts online in one application. 

When you open a savings account or term deposit online, you’ll also need to open a transaction account to transfer funds in and out of it, if you don’t already have one. 
 

Term deposits: a long-term savings account

Term deposits are another type of savings account. The main difference between a term deposit and other saving accounts is that a term deposit account allows you to lock money in an account for a fixed term. You earn interest on the balance as long as you don’t withdraw the money before the fixed term ends.

Term deposit accounts provide a fixed interest rate for a set period of time. They may be useful when saving for a larger purchase, like buying a car.

Remember, your money is less accessible during the term, and there could be minimum balance requirements. There may be fees and charges associated with breaking the term early before it has matured. The interest rate on these accounts will depend on the length of time you choose. 
 

Business bank accounts

If you’re running a business, it’s important to keep your personal finances and your business bank accounts separate. A business bank account is designed for business owners, sole traders and directors to manage business finances. 

Your business might require a transactional account with a linked Debit Card for everyday banking, a term deposit for long-term saving, a savings account to fund future growth, or a combination of all. 

Westpac’s Business One transaction account has no monthly fee and gives account holders the flexibility to bank online, on mobile, by phone or in a branch. There’s the ability to see all your banking in one place, so you can manage your personal and business accounts with a single sign in. It’s also possible to set up bank feeds to accounting software such as MYOB and Xero, to help keep seamless business records. 

Business One is suitable for a sole trader, partnership, company, association, SMSF or trust operating in Australia with an Australian address. 

Westpac also offers a not-for-profit transaction account with no monthly fees for charities and other not-for-profits. 

If you’re a sole trader, 1-director and existing Westpac customer, you can open a business bank account online. If you’re not a sole trader, 1-director or existing Westpac customer, you’ll need to open an account at a Westpac branch. The documents you’ll need to open a business account will vary depending on your business structure. 
 

Managing your bank account

To get the most out of your bank account, consider minimising bank fees by choosing no or low fee accounts, and adhering to any conditions that waive fees (such as making minimum deposits). If you set up direct debits to come out of your account on the same day you get paid, you can often avoid direct debit fees by ensuring there’s always sufficient funds in your account.

Finally, avoid ATM fees by choosing a banking provider with a large network of ATMs. Westpac’s personal and business transaction account customers can make cash withdrawals without Westpac fees at about 7,000 ATMs around the country, including at Westpac, St.George, Bank of Melbourne and BankSA ATMs. As at 1 August 2024, this is the largest combined fleet of fee-free ATMs at any of the four major banks in Australia. 
 

Keeping your account secure

No matter which types of bank accounts you choose, it’s important to take steps to keep your account secure. Keep your Debit Card and PIN secure and don’t share it with anyone. Make a habit of checking the details on your bank statement and look for any payments that you don’t recognise. 

Westpac offers security features including Card on Hold* to temporarily lock your linked debit card if you lose it, facial recognition to sign into the app, and dynamic CVC – a temporary Card Verification Code on your digital card that changes every 24 hours. 

Westpac also has 24/7 fraud monitoring to help keep customers and businesses safe, as well as a Fraud Money Back Guarantee to ensure you’ll be reimbursed for unauthorised card transactions.^{^}
 

To sum up

Various types of bank accounts in Australia serve distinct purposes, so being well-informed about the features of everyday bank accounts, savings accounts and business accounts could help you choose the right one for your personal or business banking needs.