HOW BANKS IN AUSTRALIA WORK, INFORMATION FOR MIGRANTS
Opening a new bank account is one of the many musts you need to do when you move to Australia. With a bank account, you can withdraw and deposit money, pay for your necessities using your account, and use it for online or mobile banking. Some banks have the ability to transfer your current funds to a newly opened account before you move to Australia.
One of the many available banks in Australia is Westpac. Westpac is Australia’s very first bank, and they consist of a team of banking specialists who can help you with your banking needs when you move to Australia. They have a variety of banking products to choose from depending on your needs, including regular savings account and checking account. Westpac is also very convenient to those who wish to migrate to Australia as they allow people open bank accounts with them, even 12 months before your arrival (criteria and conditions apply).
To see what Westpac has to offer, visit westpac.com.au
Types of bank accounts in Australia
A transaction account is similar to your basic bank account. You can deposit, withdraw, pay your bills and manage your expenses. In some countries, they call the transaction account either current account of checking account. The money stored in this type of account generally do not accrue any kind of interest. When choosing which type of bank account fits your needs, you have to compare the following:
- Fees and charges (normally based on the number of transactions on your account)
- Minimum balance you need to maintain to keep the account from closing or from being charged with a fee
- The number of ways you can access your account (online, mobile, ATM)
- Options give like Credit/Debit card
This type of account pays you a certain amount of interest for the fund held in this account. A savings account is best for those who would like to grow their money in the bank. The money you deposit here is usually what you won’t be using for your everyday needs. Some banks restrict the way you can access your funds, so that you won’t be tempted to withdraw it.
Most people have both savings account and transaction account, and almost always transfer funds between the two. With online and mobile banking, doing this has become much easier. In some cases, there are certain banks that only have online facilities for their savings account, while others have a higher bonus interest if you maintain a certain minimum balance or deposit regularly.
To know which savings account is best for your needs, you need to compare:
- Loan fees and any conditions for acquiring bonus interest or potentially an introductory offer
- The fees related to keeping an account, making transactions, overdraws, dishonour fees and other direct debit fees
- The different ways to access your funds
- The ability to link it to another account
If you have a bigger amount of money, perhaps coming from the sale of your assets before your move to Australia, and you wish to deposit this in the bank with a fixed interest rate, then a term deposit might be the right kind of account for you.
With this type of account, your money will be deposited for a certain term and will accrue a fixed interest rate. This type of account is suitable for those who would like to lock their money away, and don’t need it anytime soon.
You normally choose how long you won’t be able to access your account (between one month and five years), with a corresponding fixed amount of interest. Upon maturity (when your term expires), there are usually options on available on what you can do with your money including:
- Rolling your initial investment over plus the interest if you don’t give the bank instructions on what to do with your money
- Withdrawing the interest earned as a bonus, and leaving the initial amount in a new term deposit the bank makes
- Withdrawing all of it
Note: Some banks allow the interests earned in a term deposit to be deposited in another account. In case you need to access the account before its maturity, then you will have to pay a certain fee to be able to access your account.
The rates will vary from bank to bank, so it’s best to shop around. Visiting the banks’ sites can also help you see how much interest they offer, and also, depending on the amount you’re investing in, the bank may give you a better rate if you negotiate with them directly.
Opening and operating bank accounts
Once you have made up your mind on what type of account you prefer, you can open a new one online, over the counter, or via phone call. In any case, you will need to provide paperwork before your account becomes fully operational.