Media releases
Westpac cuts interest rates by 0.25% p.a.
18 February 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 4.10%.
For home loan customers:
- Westpac will decrease home loan variable interest rates by 0.25% p.a. for new and existing customers, effective 4 March.
For deposit customers:
- Westpac Life total variable rate with bonus interest will decrease by 0.25% p.a. to 4.75% p.a., effective 28 February*.
- Westpac eSaver total variable rate with a 5-month introductory rate will decrease by 0.25% p.a. to 4.75% p.a. for new customers applying online, effective 28 February**.
Speaking about the change, Westpac Chief Executive, Consumer, Jason Yetton said: “Today’s decision will be welcome news for mortgage customers. By reducing the standard variable home loan rate by 0.25 per cent per annum, customers will save an extra $90 per month, or $1,080 per year, based on a $500,000 home loan with principal and interest repayments.”
“Customers could use this as an opportunity to get ahead on their mortgage by putting the extra savings into their mortgage repayments, or into their offset account to help reduce the interest on their loan.
“However, we know that Australians are still managing the higher cost of living, and we would encourage customers who need assistance to contact us. We also have a range of tools available in our app to help customers manage their money, including a budget planner, bills calendar and savings finder,” said Mr Yetton.
In making interest rate decisions, Westpac considers a range of factors, including the needs of both borrowers and savers.
“Savers can continue to access competitive products, with headline interest rates still above the official cash rate,” said Mr Yetton.
“Customers with a Westpac Life account can also receive bonus interest by boosting their balance by just one dollar each month. We’re continuing to alert customers to this through our app, with 85 per cent of balances receiving this rate.”
Today’s announcement comes days after the bank reduced some of its fixed rate home loans, providing competitive rates for customers who are looking to lock in their rate. This means an owner occupier with a packaged home loan and a 70% LVR can secure a two-year fixed rate term from as low as 5.59% p.a. with principal and interest repayments.
Westpac is also introducing the option for eligible home loan customers to set up multiple offset accounts with no additional fee, providing more choice and control in how they manage their finances.
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 maintain this. 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 base rate on Westpac Life will decrease by 0.25% p.a..
**Westpac eSaver changes and digital offer conditions
The decrease to the Westpac eSaver total interest rate is comprised of a 0.10% p.a. decrease to the standard variable rate for new and existing customers and a 0.15% p.a. decrease to the five-month introductory variable rate for new customers. An online bonus variable rate of 0.35% p.a. is unchanged. This total variable rate of 4.75% 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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