Setting up a bank account is one of the first things you’ll need to do when moving to Australia. Even if you only plan to be in Australia temporarily, like on a Work and Holiday visa, you’ll need the bank account to deposit wages, pay bills and keep your money secure.
Having an Australian bank account will give you easy access to your money without accruing international transaction fees. Plus you can easily set up automatic bill pay with online banking to take care of monthly expenses such as health insurance and rent. I’ve put together this guide to help in your quest to find a bank in Australia.
Selecting an Australian Bank
Australia has four major banks and numerous smaller banks. I recommend choosing one of the four, because they are likely to have more branches and ATMs throughout the country. This will really come in handy when you are traveling around Australia.
The four major banks are: National Australia Bank (NAB), Australia and New Zealand Banking Group (ANZ), Commonwealth Bank of Australia and Westpac Banking Corporation. Each bank offers similar accounts and services, though there are variations in fees and the prevalence of ATMs and branches.
Things to Consider When Selecting a Bank
When selecting an Australian bank, you should keep these factors in mind.
Account keeping fees are very common in Australian banks. The fee is generally $4 to $5 a month, though it can be waived in certain circumstances. For instance, if you deposit a minimum amount each month, usually $2,000, the fee is waived. Some banks also offer a break on the fee if you are under a certain age, usually 21-25. Or if you are new to the country you may be able to get the fee waived for the first 12 months of the bank account. However, personal banking accounts through NAB have no account keeping fees ever.
Look out for other fees, including: application fees, transaction fees, ATM fees, overdrawn account fees and fees for visiting a teller. You’ll also need to look out for minimum balance requirements and any fees you might have to pay for dipping below the minimum balance.
ATMs and Branches
The number of ATMs and branches that a bank has as well as the proximity to where you live and work are also important to consider when selecting a bank. You want to be able to easily access your money or visit a branch without having to go halfway across town.
NAB has about 3,400 ATMs and 730 branches across Australia. ANZ has about 2,600 ATMs and hundreds of branches. Commonwealth has about 4,000 ATMs and 950 branches. Westpac has about 3,000 ATMs and more than 1,000 branches included in the banks’ network that has service access through other banks around Australia.
Also check out the options for online banking and mobile banking apps. They’ll generally be pretty similar. But it’s good to read the fine print of what is offered and check if you’ll incur any fees. This is especially crucial when considering the process and fee for wire transfers to foreign bank accounts if you want to send money back home.
Credit Card Payment Network
Finally, it’s worth noting which credit card payment network (i.e. MasterCard, Visa, etc.) the bank is associated with. NAB and ANZ offer a Visa debit card, while Commonwealth and Westpac have a MasterCard debit card.
These cards allow you to make purchases under debit (usually called EFTPOS in Australia) and credit systems. But either way the card is run, the money will be directly debited from your linked bank account rather than through a credit network.
My Choice: NAB Personal Banking
I recommend banking with NAB for several reasons. First, they do not charge any application fees or monthly account maintenance fees. Also, I found their customer service to be incredibly helpful, whether online, in a branch or on the telephone. Their online banking platform and mobile app are very user friendly and give you incredibly convenient access to your account. NAB also has numerous branches and ATMs throughout the country. I never had any trouble accessing my money.
Setting up my account was simple, and I didn’t even need a minimum opening deposit. I opened the account a few days after arriving in Australia, but didn’t start putting money into the account until about a month and a half later when I finally got a job. There were no fees or hassle for having the account open with a $0 balance.
Opening an Australian Bank Account
Generally the process for opening a bank account is very straight forward. Most of the major banks allow you to open an account in person or online.
Visiting a Branch
When visiting a Australian bank branch, you’ll need to have your passport, another form of photo ID, a phone number and an Australian address. Your details can be updated later, so it’s fine to start with your hostel or hotel address. Just be sure you allow enough time for your debit card to be mailed to you, along with the letter stating your pin number for the card (these are mailed in separate letters, sometimes a few days apart).
But of course, you could always let the bank know you don’t think your card will be safe if mailed to your accommodation. Ask to leave a phone number they can call to let you know when to pick up your card from the bank branch.
As for the other form of photo identification, your state driver’s license or ID from the U.S.A. should work just fine. I was able to open my account with my passport and driver’s license.
In some cases this may only be required if you set up your account after being in the country for six weeks, but I needed it when I was in Australia for just a few days. Either way, it’s good to have it on hand.
Some banks allow you to set up an account before you even move to Australia. You can apply through the bank’s website and submit an online application form, which will need to include your passport details. I don’t think this is entirely necessary, but if it gives you peace of mind, it could be beneficial. If you’re set to transfer money from home to your Australian account, then this may be a good option so you have quicker access to your funds.
You will still have to visit a branch once you are in Australia in order to access your money. You’ll be required to show the passport linked to the account to receive a debit card and set up internet and telephone banking.
Selecting the Type of Bank Account
Everyday or Transaction accounts (known as checking accounts in the U.S.) are used to make payments, receive deposits, withdraw cash and so on. These accounts are aptly named, as they are used for everyday banking purposes. You will get a Visa or MasterCard debit card linked to your account to use at ATMs and make purchases anywhere Visa and MasterCard are accepted.
Savings accounts are also what they sound like: an account for storing savings. The money in these accounts will earn some level of interest at the end of the month. Most savings accounts are free to open and have no monthly account keeping fees.
I highly recommend setting up both a transaction account and a savings account. Be sure to also sign up for online banking with both accounts. When I lived in Australia, I put the majority of my earnings into my savings account so it could accrue interest. As I needed the funds, I would just transfer the necessary amount into my checking account so I could access it with my debit card.
You will have a BSB number as well as an account number for each account. The BSB number is a 6-digit number that identifies the bank and branch. The account number is the individualized number, usually 8 or 9 digits, associated with your individual accounts. You will give these numbers to anyone who is transferring money to you. Additionally, when you transfer money to another person’s or company’s account, you will need their BSB and account numbers to complete the transaction. This may seem uncomfortable or risky, but it is actually very commonplace. I never had any problems with money transfers to or from my account.
Using Your American Bank Account
This really depends on the terms and conditions associated with your account back home. Most banking institutions charge a foreign transaction fee just for using your card abroad or purchasing from a foreign merchant (even if you are still in the United States). The fee is often about 3% of the purchase price.
This is not the currency conversion fee, which is a fee imposed for exchanging one currency for another. This conversion fee can be done by the foreign merchant or by the credit card payment network. Note: you often get a better conversion rate when the credit card payment network does the exchange, so opt to pay in the local currency when paying with your debit or credit card from home.
Depending on what type of terms and conditions are associated with your bank account and debit or credit cards from the U.S., you might end up paying significantly more than necessary. And since you’ll be earning income in Australia, you’re better off putting it into an Australian account. It will be simpler for your employer to pay you in a timely manner. Plus, you’ll have easier access to your funds without having to worry about losing money with wire transfers to and from the United States.
Which Australian bank will you choose to set up your bank account?