Consumers urged to shop around for term deposits

16 April 2009

Abacus – Australian Mutuals, the industry body for credit unions and mutual building societies, welcomes today’s announcement by the Australian Securities and Investments Commission (ASIC) about help for consumers to get the best out of their term deposits.

ASIC notes that there has been significant growth in term deposits and that term deposits are now one of the most used investments by investors and consumers.

"Consumers and investors should be shopping around for the best deal and the best service, so we welcome ASIC’s new investor and consumer guide on term deposits," says Abacus CEO Louise Petschler.

"In recent data from Canstar Cannex, credit unions and building societies on average offer much better returns than the big four banks on 3-month and 6-month term deposits."

Currently the average interest rate for a $10, 000 3-month term deposit in a building society is 3.75 per cent and for a credit union, it’s 3.39 per cent - compared to 2.16 per cent at the major banks.

"The data just backs up what we have been saying all along: that being mutuals, credit unions and building societies exist to look after their customers. Mutuals aren’t publicly listed, so they aren’t trying to maximise profits for shareholders. Instead, they’re involved in the business of providing better rates, fairer fees, responsible lending practices and outstanding member service," Ms Petschler said.

"The measure that matters most to mutual ADIs is customer satisfaction and on this measure we strongly and consistently outperform the major banks in monthly Roy Morgan Customer Satisfaction polls. Our strong, member-focused banking alternative already meets the needs of more than four and a half million Australians."

For more information:

Pamela Eldridge
Media Adviser – Public Affairs
02 8299 9094, 0423 843 790
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Luke Lawler
Senior Policy Adviser
02 6232 6666, 0418 213 025
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