A new report has found that Australian banking customers are losing up to $6.1 billion a year by not shopping around to find the best value banking options.
The report by analysts InfoChoice, which looked at the cost difference between mortgage, car loan, credit card and savings products offered by the big four banks, along with the four most competitive products offered by other financial institutions; found that if Australian banking customers shopped around for the lowest interest rates and fees they could save approximately $5.4 billion on their home loans, $257 million on credit cards and $482 on other personal lending.
According to InfoChoice chief executive Shaun Cornelius, when it comes to banking, it pays to shop around.
“By shopping around for better deals and looking outside the majors, Australians can ensure competition remains in the sector and push the cost of banking down even further,” he said.
Cornelius said when looking at the complete cost of banking, including service and transaction fees, ATM fees and interest rates, the cost savings are considerable when comparing the major banks to smaller lenders.
“By simply moving to the lowest priced products in each category, a big four customer could save more than 19 percent, or $3,800, on their annual banking costs,” he said.
Such a saving is based on a customer with a $300,000 mortgage, a $25,000 car loan, just over $2,000 in credit card debt and a typical transaction account.
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