A bank account, also called a transaction account, is the main way people receive payments, withdraw cash and make payments.
Just about everyone, from children to adults to businesses, has a bank account with a financial institution, credit union or building society.
Bank accounts are different from savings accounts in that they’re not designed to accumulate money. Instead, this is the account which you use for your everyday spending.
Learn more about bank accounts
Latest in bank account news
What is a bank account?
A bank account is an everyday account used to manage your finances. Everything from paying bills to depositing your income to withdrawing cash is managed through a bank account. Bank accounts allow you to make payments in a number of ways:
- Online shopping
- Electronic payments
- Digital wallet (e.g. Google Wallet, Samsung Pay, Apple Pay)
- Direct debit
- Branch access
What fees apply to bank accounts?
Fees can differ from one bank account to another, but the main ones you may incur are:
- Monthly account-keeping fees
- ATM fees (for your bank's ATMs and potentially even more for using another bank's ATMs)
- Phone banking fees
- EFTPOS fees
- Internet banking fees
- Branch fees
- Paper statement fees
- Overdraft fees (if you withdraw more than what is available in your account)
Yes, this sounds like a lot of fees, but the good news is that most banks offer a basic bank account that has:
- No account-keeping fees
- Free monthly statements
- No minimum deposit amounts
What are some tips to get the most out of a bank account?
Use a debit card over a credit card - Bank accounts usually come with debit cards, which can usually be used the same way as a credit card, both online and in-store. It’s generally a good idea to use your debit card instead of your credit card if you don’t want to be hit with interest on your purchase; when you use a debit card, you’re spending your own money rather than credit.
Be stringent with security - Unfortunately, fraudsters are quite common. Once someone has your bank account details, they could use it to spend your money. It’s worthwhile changing your codes and passwords often and avoid using predictable passwords or PINs (like your name or date of birth). Always check your bank statements to make sure you’ve been charged correctly for things, and there aren’t any charges on there that weren’t authorised by you. If there is a suspicious transaction, always contact your financial institution immediately.
Keep essential funds in your bank account - People sometimes keep large amounts of money in their bank account, which can be a mistake. It’s usually better to keep only required funds in your bank account and move larger amounts to a savings account, where they can earn interest. You generally don’t need to access large amounts day-to-day, so always budget and designate funds to where you think they best belong.
Check out online and mobile platforms - Most banks, credit unions or building societies have apps or websites for mobile banking or internet banking. These platforms allow you to do things like view your balance, pay bills and transfer money on the go.
What are the pros and cons of having multiple bank accounts?
- Different accounts for different purposes - If you like to be organised, then you may prefer having different accounts for different purposes. For example, you could have one bank account for day-to-day expenses (such as petrol and food), another account for rent or mortgage repayments and another account for your child’s pocket money. For some people, this level of organisation could be one way to budget effectively.
- Access special features and bonuses - Often, a bank, credit union or building society will offer special rewards, bonuses or benefits for opening a bank account, for example a lower introductory fee or waived account-keeping fees. Opening up more than one bank account could increase these benefits. Banks also sometimes offer package deals. For example, the bank could offer you perks if you take out multiple banking products (including a bank account). It’s important to do your research on any financial product before signing up and make sure you’re signing up to one that best suits your situation, not the one with the most attractive perks.
- Multiple bank accounts can just be plain confusing – If you’re not overly organised or lose track of things easily, then multiple bank accounts might not be for you. Constantly moving and sorting funds can be complicated and time-consuming. If you prefer more of a hands-off approach to your bank funds, then one bank account is probably the way to go.
- You can be hit with multiple fees – Bank accounts often come with a mixed bag of fees, from account-keeping fees and overdraft fees to ATM fees. So, having multiple bank accounts could increase your risk of paying more fees. If you’re opening multiple accounts to take advantage of features and benefits, then be aware that banks sometimes charge fees. If you’re paying this fee across multiple accounts, the benefits may not be worth it in the end.
Which bank account is the best?
Bank accounts are offered by basically every bank, credit union and building society and they’re largely the same across the board.
There is no “best” bank account for everyone, always do your research to make sure you’re getting one that suits your individual needs.
Frequently asked questions
Opening a bank account for a child
Can you close a bank account over the phone?
Can you open multiple bank accounts?
Linking paypal to your bank account
Can you open a bank account from another country?
How to open a bank account for a baby
How to close a bank account
Can I find my bank account number online?
Yes, you can find your bank account number by logging into your online banking and clicking on the relevant account.
Can foreigners open bank accounts in Australia?
How to close a bank account online
Opening a bank account for someone under 18
How to transfer money to another bank account
Transferring money to another bank is often called a bank transfer, and it can be done a few different ways.
Customers generally need three pieces of information to transfer money to another bank account. Customers need the account name, BSB and account number of the account they wish to transfer money to.
One way of transferring money to another bank account is in a branch with the help of a staff member; they will often give you a receipt as well as confirmation of the transfer.
Transfers can be also made via internet banking and phone banking.
Some banks also allow customers to make transfers via partnered ATMs, especially if the account is with the same bank.
Can I open bank accounts for my children?
A common question for new parents is, ‘Can I open a bank account for my child?’
The short answer is yes – as a parent you can open a bank account for your child.
Once you’ve compared your options and found a bank account that suits your needs, the process is relatively simple.
As the bank account is for your child, you’ll need to provide some documentation such as proof of ID, including your tax file number.
You will also need a copy of your child’s birth certificate, and in some cases you may also need to sign a guarantee of indemnity.
Depending on the bank and whether you’re an existing customer, you may be able to open a bank account for your child online. However, you may still need to go into a branch to prove your identity.
Are bank accounts frozen when someone dies?
Yes, Australian bank accounts are frozen when someone dies. If you want to close the account of somebody who has died, you might have to provide proof of death and a copy of the will. You might also have to prove your relationship to the deceased person.
If you have a joint bank account with somebody who has died, you will generally be entitled to all the money in the account. Again, you might have to provide proof of death if you want to change the bank account from a joint account to a one-person account.
Can I start a bank account online?
Yes, most lenders that operate in Australia will let you set up a bank account online. The process is usually simple and takes five to 10 minutes. You will probably need to provide a passport or birth certificate, as well as a driver’s licence, Medicare card or another form of secondary identification. Requirements differ from lender to lender, so some institutions might ask for more or different forms of ID.
Can you deposit money into somebody else's bank account?
One of the easiest banking tasks in the world is depositing money. You can even deposit money into someone else’s bank account if you wish.
The basic information you need to deposit money into a third-party bank account is:
- Payee’s name
- Bank, building society or credit union (though this isn’t necessary)
- BSB (or bank code, which is the branch identifier)
- Account number
Including the name of the financial institution isn’t necessary – particularly with online banking – because the BSB will identify this for you.
A handy tip is to record yourself (or add a personal message) in the transaction description or reference. This will show up on the recipients account, letting them know who’s paid them the money.
How can I find bank accounts in my name?
To find ‘live’ bank accounts in your name, you’ll have to ask individual lenders, which involves contacting them one by one and proving your identity each time. To find ‘unclaimed’ bank accounts (those that have been inactive for at least seven years), you can use this website.
How do I open a bank account for a child?
There are few better ways for a child to learn about money management than through savings. And there’s a plethora of bank accounts designed specifically for young people and children.
A bank account for a child can be opened online, over the phone or in a branch in a few easy steps. The minimum age a child can open a bank account for themselves usually ranges between 12 and 14.
If the child is too young to open the account, you can do it for them as their legal parent or guardian.
To do this, you would need to be over 18, have an Australian residential address and currently reside in Australia (or have proof of residency).
You would also need to provide:
- Identification for yourself and the child
- Your tax file number (TFN) or TFN exemption
Depending on the bank account, you might be able to choose what level of access the child has to their bank account (online and via the phone).
How can I wire money to a bank account?
You can wire money to an Australian bank account either through your own bank or by using a money transfer company such as Western Union or MoneyGram. Either way, you’ll need the other person’s name, BSB number and account number. If you use a money transfer company, you might also need to provide the recipient’s address for large payments.
Can I close my bank account over the phone?
In most cases, you can close a personal or business bank account over the phone. In fact, this is the best way to ensure you’ve closed an account properly.
By speaking to a banking representative, you can capture and close out any pending transactions, or interest owing/payable on the account being closed.
In the instance where the account is a joint account, or you have multiple bank accounts you want to close, your bank may send you a form that you need to fill out and return.
Either way, you would be advised over the phone of the steps you need to take. Calling your bank ahead of closing an account is often a smart course of action.