Westpac Life account holders under 30 will be able to access the higher interest rate if they increase their monthly balance and make five debit transactions with a linked Westpac spending account.

If customers are unable to grow their monthly balance, a base rate of 2.40% p.a. will apply, which is still ahead of many competitors' rates.

The special interest rate will apply to balances up to $30,000.

The linked transaction account attracts a $5 monthly fee if customers do not deposit at least $2,000 a month (e.g. their pay), but that fee is waived if they are under 21 or a full-time tertiary student, a pensioner or Commonwealth health care card holder.

Currently, the Westpac Life interest rate sits at 1.00% - a 0.40% standard variable rate, and a 0.60% bonus rate if customers grow their account balance every month.

Compared to other banks, the 3.00% rate would make Westpac notably higher than even introductory rates.

Westpac's head of savings and investments Kathryn Carpenter said COVID-19 has encouraged many young Australians to reassess their finances.

“Building savings can already be challenging for young adults who are only just starting their
financial journey, particularly in an environment like this where many are also now navigating
changes to their income or employment," she said.

"It’s clear this has been a turning point for many younger Australians, who are thinking more about owning a space of their own in the future and prioritising saving for a deposit."

Research commissioned by Westpac also found COVID-19 has made two thirds of young Australians motivated to save for their first home.

The research also found nearly half are planning to save more than they did before the pandemic hit, and 85% have chosen to cut back spending or hold off on large purchases.

The survey attracted a total of 2,376 responses from 23 March to 4 June, and an additional survey attracted 1,176 responses from 18 May to 22 May.