Banking in Australia: Complete guide for expats

Australia has a very well developed banking system with many different banks to choose from, and an excellent range of products and services. However, it’s not likely to be quite the same as what you’re used to at home. From the names of account types through to the common fees and charges, banking in a new country can be confusing. This guide is here to help international residents in Australia navigate the banking system and make the most of their money.

We’ll look at popular Australian banks, account types and fees – and also some smart international solutions like Wise, which can help you hold, send, spend and exchange AUD alongside 40+ other currencies.

Overview of the banking system in Australia

There are plenty of banks to choose from in Australia, which tend to offer a broad selection of account types and good digital services. To find the best bank in Australia you’ll need to do a bit of research based on your specific needs.

Banking in Australia is highly regulated to help keep customers and their money safe. Services are overseen by bodies including the Reserve Bank of Australia – the central bank in Australia.

The Australian ‘big 4′ banks – the most popular and largest banks in the country – are:

• ANZ Bank Australia
• Commonwealth Bank of Australia – more often known as Commbank
• Westpac
• National Australia Bank – usually referred to as NAB

Bear in mind that Australian banks usually offer AUD accounts only, and you must be an Australian resident to open your account.

If you’re moving to Australia from abroad, you may be able to start your application for a bank account up to 14 days prior to moving, but you need to visit a branch to get verified and give your residential address before you can actually access services.

This may not be convenient if you want an AUD account as a non-resident. Alternative providers like Wise have been created to help meet the needs of people looking to manage their money across currencies, including holding, exchanging and spending AUD alongside other currencies.

Currency in Australia

The official currency in Australia is the Australian dollar. You’ll see this written as AUD, A$ or $. Each dollar is split into 100 cents, shown as c or ¢.

AUD bills are available in the following denominations $5, $10, $20, $50, and $100.

Coins available include 5¢, 10¢, 20¢, 50¢, $1 and $2.

If you need to exchange your home currency to AUD for your trip to Australia – or because you’re moving there – you can do so online and through digital providers, or through physical banks and exchange offices. Be careful to check the exchange rates you’re offered as these can include additional fees – a markup – which means you get less AUD for your home currency in the end.

When you’re researching currency exchange for Australia, take a look at providers like Wise, which offers the mid-market rate, with low transparent conversion fees. You can open a Wise account online or in an app, to hold and exchange 40+ currencies including AUD, all in one place. This makes it easy to see your balance across multiple currencies and manage your money when you live an international lifestyle.

Banking system in Australia

Australia has a very well developed banking sector with retail banks operating on local, regional and global levels. Financial services in Australia are well regulated, and overseen by many different bodies to keep customers safe.

Major banks like Westpac and ANZ offer good account services with broad branch and ATM networks, but as we’ve seen, these do tend to be limited to Australian residents. Non-resident accounts can be far harder to find from Australian banks. You can not usually open a bank account online in Australia as a newcomer as you’ll need to go to a branch for verification.

If you’ll be managing your money digitally you could also select a digital bank like ING Bank Australia. Or if you’d prefer a credit union to a bank you might like Great Southern Bank Australia instead.

Other providers, which aren’t banks, also offer specialist services. For example, Wise has multi-currency accounts and payment services which appeal to expats needing to manage their money across different countries and currencies.

Types of banks in Australia

Let’s have a quick look at the most common types of banks in Australia:

• Commercial banks like NAB and Commbank, which offer checking and saving accounts in AUD for individual customers
• Investment banks and private banking options – which can also be from commercial banks like Commbank and Maquarie, offering investment and wealth management solutions
• Credit unions – like Great Southern, which are member owned, offering accounts and credit services
• Online banks like ING which offer a full suite of digital services with no branch network
• Foreign banks operating in Australia which often only service enterprise level institutions, and do not have retail banking options

Bank account types in Australia

The most common account types you’re likely to see from Australian banks will include:

• Transaction accounts
• Savings accounts
• Business accounts

Each has their own uses – and many people have multiple different accounts to meet their transaction needs.

Transaction accounts

Transaction accounts are for day to day money management, and usually hold AUD only, with a linked debit card. You can normally manage your money largely online but some transactions can only be made in a branch.

Australian transaction accounts often have a monthly fee, but this can be waived in many cases by holding a specific amount in the account at all times. Other fees apply based on the way you transact, which can include transfer charges and ATM fees.

Savings accounts

Savings account products can include instant access account and term deposit options, which may get you a higher rate of return if you can leave your money for a longer time. Some banks also offer foreign currency savings products for customers who want to diversify their savings.

Savings accounts often do not have monthly fees but you’re likely to need to also hold a transaction account which might mean paying some fees anyway.

Business accounts

Most Australian banks offer business account products which may be offered to specific entity types. Products are often split up to suit sole traders or startups, SMEs or enterprise level clients, which gives the choice to pick one account and then trade up as your business needs change.

Account fees can be quite different when looking at business products compared to personal accounts.

Open an AUD account as a non-resident with providers like Wise and Revolut

To open a bank account in Australia you usually need to be an Australian resident. This makes it hard to open an account before you move to Australia – and can mean it’s impossible to open an account with an Australian bank if you’re a non-resident.

The good news is that providers like Wise and Revolut can offer a more flexible onboarding experience, with accounts you can open using a proof of address from your home country before you move to Australia. These providers aren’t banks – but they do offer safe services to manage AUD and other currencies, with a fully digital application process.

Open your account online or in an app and you can then get Australian account information to hold, receive, spend and send AUD payments easily. Plus you’ll be able to make international payments and order a card for day to day spending to keep on top of your money whichever currency you use.

Bank cards and payment methods

The most common payment methods in Australia include:

• Cash – used for small purchases and tipping, although digital payment methods are becoming more common
• Debit and credit cards – very widely accepted, including wallets like Apple Pay for mobile payments
• Digital wallets – wallets like Beem are very popular for splitting bills and making small, instant AUD payments to friends
• Buy Now, Pay Later (BNPL) – growing in popularity, options to get credit on purchases and repay in installments, often used in online shopping
• Local transfers – bank transfers and services like PayID are the most common AUD to AUD transfer methods
• International transfers – bank international transfers are used, but alternative providers like Wise also offer lower cost international payments in many cases

Cash

While cash is getting less popular in Australia, as in many other countries, it’s still an important payment method. It’s also convenient to have cash on hand for tipping and other small value purchases.

ATM fees can apply if you’re taking cash out in Australia, particularly if you make an out of network withdrawal.

Debit and credit cards

Using a card for a swipe or chip and PIN payment, or making a contactless payment with your card or phone are increasingly popular as payment methods. Debit cards are generally pretty cheap to use domestically, but fees of about 3.5% can apply if you use an Australian card overseas.

If you intend to use a credit card, you’ll need to build your credit history to get the best available deal. Bear in mind credit card fees can be very high, in particular cash advance fees and penalties if you don’t repay your bill on time.

Digital wallets

Digital wallets like Beem are used in Australia for instant local payments in AUD. These services are really helpful for splitting bills with friends, but not recommended for large or commercial payments.

Buy Now, Pay Later (BNPL)

BNPL services are common when shopping online and allow you to split the costs of a bill into installments, often with interest to pay. This is a form of consumer credit and should be used with caution – read the terms carefully so you know any fees that apply.

Local transfers

AUD to AUD bank transfers and PayID payments are often cheap or even free, but can have low limits on the amount you can send. BPAY is another popular option for local bill payments, which is often available through your bank’s digital banking services.

International transfers

Banks will usually offer international transfers which may have the transfer fee waived for online payments. If you need to make your payment in a branch you may pay a fee of around 30 AUD. Bear in mind that even when the transfer fee is waived, your payment isn’t normally free as you’ll have to pay an exchange rate markup.

Specialist providers which offer digital only payments can be a good solution. Providers like Wise have high value payments with low fees and the mid-market rate. Or you might try OFX, which has no limits and a 24/7 phone service if you need to talk through your payment. Other options include Remitly and Xe Money Transfer, which both offer a broad coverage with variable fees and rates.

Opening a bank account in Australia

Opening a bank account in Australia should be simple enough once you’re a resident there – but in many cases you’ll need to visit a branch to get everything set up. This is usually the case if you’re a new arrival, if you have non-standard documents or are a first time customer at a particular bank.

Once you’ve decided which bank to target, you’ll need to choose an account, check the account eligibility and prepare your documents before you go to your account opening appointment, Usually you must take along:

• Proof of your ID – like a passport
• Proof of address – like a utility bill
• Your tax information and ID
• Proof of legal residency in Australia – your visa or other relevant paperwork

Major banks in Australia

Australia has a healthy range of banks and other financial institutions, from regional and national banks, global organisations, credit unions, and digital providers. Here are some popular banks in Australia across all of these sub-types:

Westpac: Australia’s first bank and oldest company, one of the ‘big 4′ in Australia, and also the biggest bank in New Zealand.

NAB: Australia’s largest business bank, which offers individual and business services and also has a presence in the UK, US, Europe and beyond.

ANZ: Offers retail and business banking services in Australia and around 30 other markets globally.

Commbank: Large regional bank with 100+ years of history, and the largest Australian-listed company by market capitalization.

ING: Digital only bank providing a range of transaction and savings accounts, as well as credit, loans, insurance and super policies.

Great Southern Bank: Credit union model, offering a range of services – in discussions about a merger with P&N Group at the time of writing.

Banking services in Australia

• Transaction accounts – everyday accounts for the day-to-day needs, often including a debit card
• Loans – loan services are usually split by need – to buy a car for example, with other products for things like home renovation
• Mortgages – mortgages can come from banks or stand alone specialist services, all subject to meeting eligibility rules
• Savings – instant access and fixed term products in AUD, with some options in foreign currencies are usually available
• Investments – investment services can focus on wealthy individuals or people saving for retirement (superannuation)
• Digital banking – digital and internet banking options are usually available, but not all services may be offered without going to a branch
• Business banking – all major banks offer accounts, products, and services to businesses and freelancers in Australia

Banking hours in Australia

Most Australian banks open from 9:00 a.m. to 4:00 p.m. or 5:00 p.m on weekdays. There may be shortened opening hours on a Saturday, and branches are often closed on a Sunday.

Australian banking fees and costs

Here are some of the most common banking fees, and average costs in Australia:

• Monthly account maintenance fees: 4 AUD – 6 AUD on average, with ways to waive the fee often available
• ATM withdrawal charges: often no in network fee, but costs of 5 AUD if you’re overseas
• Foreign transaction fees: usually around 3.5% where applied
• International transfer fees: international transfers in foreign currency may have no transfer fee, but the exchange rate cost can be quite significant. Arranging a transfer in a branch may cost 30 AUD or more

The fees which apply to Australian banks may be unfamiliar. While you’re learning about the costs of banking in Australia, compare the costs of using Wise for your international transactions. Wise uses the mid-market rate and low fees on all transfers, which can keep down your overall costs significantly. There are no hidden fees, and you can see what your recipient will receive in the end before you initiate your payment.

ATMs and cash withdrawals

ATM network coverage and accessibility in Australia is very good. Most major networks are supported and you’re seldom far from a cash point.

Be aware of the daily withdrawal limits that apply to your card, and the limits the ATM operator imposes. These limits vary, but you may find you have to take out cash in multiple installments if the ATM limit is low – paying the fee multiple times if one applies.

Out of network ATM use usually has a fee, but as this may be set by the ATM operator your bank may not be able to tell you in advance what your withdrawal will cost. If you’re getting a cash advance from your credit card the costs can be even higher. Generally there’s a flat or percentage fee, plus instant interest to be paid – making this a costly way to get cash.

Online and mobile banking

All Australian banks have online and mobile banking services which offer comprehensive features to check your balance, make a payment, and manage your card.

Providers usually offer 2 factor authentication options for security and also have anti-fraud measures built into their operating processes. For higher value payments you may need to go to a branch to show your ID and verify a transaction, instead of using your banking app.

International banking services

Australian banks do usually offer international transfers and SWIFT payments, but multi-currency accounts and foreign exchange services may not be available from an Australian bank.

Wise can be a good alternative if you’re struggling to manage your international finances with your Australian bank. Open a Wise multi-currency account to keep your money in the currencies you need side by side and make payments digitally around the world with low fees and the mid-market rate. While bank transfer fees may be high and tricky to understand, Wise has transparent pricing which allows you to easily see the true cost of your overseas payment or currency conversion.

Building a credit history in Australia

As a newcomer to Australia you’ll want to build a local credit history to get a credit card, loans and other useful products in future.

Getting a credit card and building your credit history can be a good way to start. Some providers offer basic credit cards which you can apply for with a low credit score, or limited history, and with wise use build a good credit score.

Be careful to repay your bills on time, and don’t max out your cards to show responsible use of the credit facility you’ve been granted. You can check your credit score through various credit bureaus to see how you’re doing along the way.

Important banking complaints and problems in Australia

Most banking services in Australia work without issues. However, if you’re unlucky enough to run into problems you can make a complaint to the Australian Financial Complaints Authority (AFCA).

Some issues which come up in online reports include banks closing customer accounts abruptly, and without adequate explanation of why. This may occur if there is any suspicion of fraudulent use of an account, or if there’s any issue in the verification processes required to open and maintain the account for example.

Banking security and fraud in Australia

Australian banks do run high level security throughout their operations, but as criminals are constantly trying to find ways to profit it’s still important to take common sense precautions:

• Keep your banking information, passwords and PINs secret
• Review your transactions frequently and report anything that looks suspicious
• Get to know common banking scams and fraud tactics to be able to spot them if you see them
• Use 2 factor authentication on your phone, and do not use digital banking on open wifi networks
• Watch out for phishing and other common email and social media approaches
• Never feel pressurised into making a payment – check for legitimacy, and make complaints to your bank if you need to

Practical banking tips for expats

• Having an Australian bank account is helpful once you arrive in Australia – but opening an account with a provider like Wise can be a good plan to manage AUD services before you relocate
• You can not usually open an account with an Australian bank if you are not an Australian long term legal resident
• Read through your account fee schedule carefully as the costs of your new account might be very different to the costs of your home account
• If you need to manage your money across currencies or send international payments, use tools to track exchange rates, to convert or send at the optimal time
• Consider having several different accounts so you can choose the right account and card for specific transactions, in Australia or internationally

Conclusion: Banks in Australia

Australia has a strong banking system, with many choices for account and card services. However, features and fees may be very different to what you’re used to, so investing some time in researching the Australian banking system will really pay off.

Use this guide to get a feel for what to expect from an Australian bank, and also how a provider like Wise could help if you’re an expat living an international lifestyle. Choose Wise alongside your local Australian bank to manage your money across 40+ currencies with mid-market exchange rates, low, transparent fees and no ongoing costs.