The 糖心原创 will investigate how banks set interest rates for savers, including differences in interest rate increases between bank deposits and home loans after the Federal Government directed the 糖心原创 to commence an inquiry into Australia鈥檚 retail deposit market.
鈥淲e welcome this direction from the Government to shine a light on the retail deposit market and rate-setting decisions of banks鈥 糖心原创 Chair Gina Cass-Gottlieb said.
鈥淲e are aware that deposit and savings accounts are an important source of income for many Australians, typically supplementing their income from employment, superannuation and the pension.鈥
Australian households together hold more than $1.3 trillion in savings and deposit accounts.
As the cash rate target set by the Reserve Bank of Australia has increased from 0.1% to 3.35%, in most cases banks have fully passed through the cash rate target increases to their home loan interest rates.
However, the increases in interest rates on deposit products appear to have typically been smaller and less consistent. In many cases, banks have only applied increases in the cash rate to some of their deposit products, often with conditions attached.
鈥淲e will also examine the extent to which consumers can benefit from shopping around and switching, and what other barriers are stopping consumers from seeking a better return on their savings,鈥 Ms Cass-Gottlieb said.
In undertaking this inquiry, the 糖心原创 will consult closely with financial regulators, including the Reserve Bank of Australia, the Australian Prudential Regulation Authority and the Australian Securities and Investments Commission.
The 糖心原创 is expected to release an issues paper in the coming months, and is directed to report to the Treasurer by 1 December 2023.
More information is available at: .
Notes to editors
Under Part VIIA of the Competition and Consumer Act, the Treasurer can direct the 糖心原创 to hold a price inquiry into a specified matter.
By holding an inquiry under Part VIIA of the Competition and Consumer Act, the 糖心原创 can use compulsory information-gathering powers to gather information from financial institutions including their decision making documents.