Media releases
Westpac reduces interest rates
12 August 2025
Westpac has announced interest rate changes for home loan and deposit customers following the Reserve Bank of Australia’s decision to decrease the cash rate by 0.25% to 3.60%.
For home loan customers:
- Westpac will decrease home loan variable interest rates by 0.25% p.a. for new and existing customers, effective 26 August.
For deposit customers:
- Westpac Life total variable rate with bonus interest will decrease by 0.25% p.a. to 4.25% p.a., effective 22 August*.
- Westpac eSaver total variable rate with a five-month introductory rate will decrease by 0.25% p.a. to 4.25% p.a. for new customers applying online, effective 22 August**.
Speaking about the change, Westpac Chief Executive, Consumer, Carolyn McCann said: “Following the Reserve Bank’s decision, we’re making further reductions to home loan interest rates. We know many people continue to manage cost of living pressures and three rate cuts this year will no doubt provide some relief to household budgets.”
Westpac analysis shows this rate change, together with the previous reductions announced in February and May, means customers could be saving an extra $266 per month or $3,192 per year based on a $500,000 home loan with principal and interest repayments.
“We’re seeing customers use the extra breathing room in a variety of ways – from paying down their loans faster to building up savings buffers or covering everyday expenses,” McCann added.
Westpac customers paying principal and interest will be notified directly about what this will mean for their repayments and how they can make changes, which includes via the app, the website or by contacting the bank.
“We’re here to support customers. Whether it’s reviewing your home loan or understanding your savings options, we encourage customers to get in touch with us. Our team is ready to help,” McCann said.
Support for customers:
Customers can visit the Westpac website for more information about our latest home loan or deposit rates. They can also call us on 132 032 or visit their local branch. Those experiencing financial difficulty can contact Westpac Assist for personalised support on 1800 067 497.
Tips for managing home loan repayments for variable rate customers:
- Plan ahead. Customers can use a mortgage calculator to work out how much their repayments may cost after an interest rate change or use it to see what the impact of any further changes may mean for their mortgage. Westpac’s Mortgage Repayment Calculator can be viewed here.
- Get ahead. Customers may be able to reduce the total term and interest costs of their loan by continuing to make repayments at the current level if they’re able to. This can be done through our app, online banking, visiting a branch or calling our team. Another option is splitting their monthly repayment in half and paying every two weeks instead. By paying more frequently, customers are reducing the principal amount sooner, as they will make the equivalent of an extra month’s repayment each year.
- Maximise offset accounts. An offset account is an eligible transaction account linked to a customer’s mortgage account. The balance of this linked account is ‘offset’ against the home loan balance when loan interest is calculated, so could reduce the amount of interest paid. For customers without an offset, now could be a good time to check if their loan offers this feature and consider if it’s right for them.
ENDS
*Westpac Life changes
The standard variable bonus rate on Westpac Life will decrease by 0.25% p.a.
**Westpac eSaver changes and digital offer conditions
The total variable rate for new eSaver customers applying online consists of the standard variable rate of 1.00% p.a., a five-month introductory rate of 2.90% p.a., and a bonus rate of 0.35% p.a. This total variable rate of 4.25% p.a. is available for new eSaver accounts opened online by sole applicants who have never held an eSaver account before.
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