An Online Bank Australia V The Big Four: Who should you bank on?

Banks are like a universal language when it comes to our finances. Unless you’re under the age of about 16, chances are you are a member of a bank. You actually have to have a bank account if you ever want to get a job or buy things online or just live in general. The good thing is that it is completely up to you which bank Australia offers you want to hold an account with.

One of the most common reasons people give for being a member of a certain bank is that their parents were members so it was just easy. This is completely understandable as, a lot of the time, your parents are the ones who set your bank account up for you. Why wouldn’t they choose the same one?

Coming into adulthood though, you are now allowed to make your own decisions based on what suits you and your adult needs. Once you start making some real money of your own and making plans to use that money for specific endeavours, it might be a good idea to look at the benefits you get from your bank and if you can get better ones elsewhere.

As we’re now in a time where technology knows far fewer boundaries than it used to, online banks are starting to gain popularity within society. An online bank Australia offers very similar services as a traditional bank, however, there are a few differences that may determine which road a person goes down: online or traditional.

We’re going to talk about the pros and cons of online banks and how well they stand next to more traditional banks like the Big Four.

The Big Four Bank Australia

The term ‘The Big Four’ is a colloquial name used to describe the 4 major banks in every country that is dominated by just 4 institutions. Fun fact: there are 37 countries in the world in which the banking industry is dominated by just four major banks.

The big four banks in Australia include:

  • Australia and New Zealand Bank (ANZ)
  • National Australia Bank (NAB)
  • The Commonwealth Bank of Australia (CBA)
  • Westpac Banking Corporation

These banks are the largest in Australia by market share as, between them, they hold 80% of the home loans market in the country. More than $600 billion of the $750 billion that Australian households have in cash deposits sits with one of the big four banks. The popularity of these banks and the amount of trust Australians put in them to look after their money definitely shows that they are doing something right. However, it could also be a few million cases of ‘changing banks is too hard’ that’s keeping the big four where they are in the market.

Benefits of the big four and other traditional bank Australia

They have a wide range of options

Whether you’re looking to open a personal savings or checking account, a business checking account, a pensioner security account, or even a trust fund, it is very likely that traditional banks will offer all of these services. They’ll also offer these services all in the one place along with further wealth management and investment services as well.

They are convenient

The leading banks in Australia have brick and mortar locations and ATM’s all over the country. The ATM’s are free for customers to use and are available for use 24 hours a day, 7 days a week. They allow you to withdraw cash, deposit cash, check your account balance and transfer funds at any time of the day.

You can have both

All of the big traditional banks offer online banking services as well. This is something you have to set up manually after opening your account but it will let you set up extra accounts, pay bills, receive online statements and make international payments.

Cash deposits

Cash is the most traditional form of currency and is something that a traditional bank Australia still works with. Although the use of physical cash has diminished significantly in recent years, it’s still nice to know that we have the option to make cash deposits. You can walk into any bank Australia branch and make a cash deposit, or you can make one at any respective ATM. This is something that online banks are currently unable to offer.

Face-to-face service and help

This is a huge bonus for new customers or those opening a new type of account. Direct physical communication can sometimes be invaluable for customer service and problem resolution. Many people take comfort in the fact that they can just walk into a branch and ask for help instead of trying to solve the issue themselves or sitting on your mobile, waiting to talk to a customer service agent.

Disadvantages of a traditional bank Australia

Low to no interest rates

Traditional banks offer, if at all, quite low-interest rates on savings accounts, especially compared to an online bank Australia. The reason that traditional banks offer lower interest rates on savings compared to online banks is that they have much higher overhead costs.

Limited accessibility

The big four banks in Australia do have call lines open 24 hours for some issues. However, if you have a particular query or issue outside of the banks regular trading hours, you may have to wait until the next day before you can seek help. If you’re travelling or unable to make it into a branch during standard hours of operation, you won’t be able to conduct your business. If your working hours are the same as the banks then visiting a branch can also prove to be quite difficult.

Less efficient

Getting in the car, driving to a bank Australia branch and standing in line to be served can be inconvenient at the best of times. Just like most things, it is generally more efficient to do your banking online where you can make use of all the bank’s services without having to get up from your desk.

Larger account minimums

A traditional bank Australia will generally require you to maintain a much higher monthly balance in order to avoid being charged monthly fees. Many traditional banks require a minimum deposit of $2,000 per month to have the fees waived. Whereas online banks, if they have one at all, have an average minimum of about $350.

ATM fees

You won’t be charged a fee if you’re using an ATM from your bank. However, if you are withdrawing cash from smaller, independent ATM’s, you can be charged around $2.50 for every transaction you make. This means that if you’re in a place where there isn’t an ATM for your bank around, it could actually end up costing you money.

Advantages of an online bank Australia


Online banks are open for business anywhere you have an internet connection: it could be from the comfort of your own bed if you choose. If the internet services aren’t available, customer service is generally provided around the clock via telephone. You will never have to drive to a branch and stand in line to ask questions about your service.

Better interest rates

As we mentioned before, an online bank Australia has much lower overhead costs than a traditional bank. Therefore, they can offer higher interest rates on savings accounts and lower mortgage and loan rates. Some online bank accounts can also be opened with no minimum deposits and carry no minimum balance or service fees.

Studies have even shown that for every billion dollars Australian’s deposit into certain traditional banks instead of online banks, $7.5 million is lost. That means that for any amount you have in a traditional bank savings account, you’re missing out 7.5%. That’s money staying in the bank’s pocket instead of your own, which is where it belongs.


An online bank Australia will typically have more inclusive websites that offer a comprehensive set of features that may not be found on the websites of traditional banks. These features may include budgeting and forecasting tools, financial planning opportunities, investment tools and loan calculators. Many online banks will also offer free online bill paying, online tax forms and tax preparation.

Strong online interface

In addition to the range of services offered on an online bank Australia website, they will generally have a superior online website interface compared to the websites of traditional banks. This is due to the fact that all of your interactions with an online bank are done through its website. Therefore, online banks typically have very sophisticated websites with plenty of features and a very fast response time.

Ease of use

Online bank accounts are easy to set up and require no more information than a traditional bank does. A lot of the time, all they’ll ask for is proof of identity. As everything is done online, you don’t need to print out forms, fill them out and then scan them or take them to the branch. Unless you want to do that, of course. Another advantage of using online banking is that you can select to have your payee information retained. This means that you don’t need to re-enter information on subsequent checks to the same payee.

Opening an account is quick and easy

This is closely linked to the ease of use of online banks. This is because opening an account with an online bank Australia will be one of the easiest things you do with your day. If you feel like opening an extra savings account on a Sunday night after spending too much on the weekend, you can. That account could then be ready to go by Monday morning. You never have to wait for normal operating hours to start to make requests as online banks’ operating hours never stop.

Disadvantages of an online bank Australia

Bank relationship

Traditional banks come with the opportunity to form personal relationships with the team at the bank or particular branch. Having these relationships can be an advantage when you need a loan or a special service that may not normally be offered to the public. A bank manager will usually have some discretion when it comes to altering the terms of your account, especially if you are a valued customer. If you have a personal relationship with your bank it may also be easier to solve certain problems such as undeserved fees or a lost or stolen card.

Websites can go down

Even the internet has tough days. Therefore, it is possible for your online bank’s website to go down on the odd occasion. While it’s rare, it’s not completely unheard of for these websites to have technical failures. These failures could render the website inaccessible. This could force you to sit on hold to customer service as it’s likely that there would be an influx of calls if this were to happen. Website failure may also mean that you are unable to make important, time-sensitive transactions.

Which should you choose?

While there aren’t too many drawbacks of an online bank Australia, the two listed are quite substantial. All points listed here are things worth considering when making your decision about whether you want to bank traditionally online. It is not our place to offer advice, but instead, offer the quick online facts that can help you choose what’s best for you.

We will say that online banks are looking to be the wave of the future in terms of the way society’s internet usage is progressing. There are more and more people moving from a traditional bank Australia to an online bank and online banks are challenging the competition of the big four banks. However, these traditional banks still hold the majority of the market share and they are definitely using the advance in technology to expand and modify their services.

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So, in summary, it is completely up to you. If you have recently changed from a traditional bank to an online bank, or you are thinking about doing so, we’d love to hear about your experience and opinion. Head over to Quick Online Loans to apply for a loan or pop over to our facebook page to leave us a comment!