ME Bank announced it will be passing on a 25 basis point increase to one year term deposit products, pushing the highest available rate to 5% p.a.

This is the first time an Australian bank has offered an unconditional and ongoing 5% rate during this high rate period, and ME overtakes Judo, the previous market leaders which moved to 4.90% p.a last week.

Transport Mutual Credit Union has a special offer of a 5% p.a rate on one year products for new deposits, but savers will need to fill out an application form via email to be considered.

It's also offered only for new customers to the mutual bank.

Given current expectations that the cash rate is set for further increases, it's likely the coming weeks will see more providers with term deposit rates starting with a 5.

Current highest one year term deposit rates in Australia

Deposit size Interest rate
ME $5,000-$2,000,000 5.00% p.a
Transport Mutual $1,000-$99,999,999 5.00% p.a*
Judo $1,000-$999,999 4.90% p.a
Firstmac/Goldfields Money $5,000-$5,000,000 4.85% p.a
AMP $25,000-$5,000,000 4.80% p.a

*Special offer for new customers, external accounts only

ME rate changes

Rates are slightly lower for ME customers who choose to receive interest payments monthly rather than annually or at the term conclusion.

No establishment or account keeping fees apply to ME's range of term deposit products

Term length Deposit size Payment frequency Interest rate (Percentage point increase)
One year-18 months $5,000-$2,000,000 End of term 5.00% p.a (+0.25)
One year-18 months $5,000-$2,000,000 Annually 5.00% p.a (+0.25)
One year-18 months $5,000-$2,000,000 Monthly 4.95% p.a (+0.25)

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