Members Equity (ME) Bank was created by a group of industry super funds in 1994. This means that all profits are distributed back to the super funds that own the bank. ME offers its customers savings and transaction accounts, term deposits, home loans, personal loans, credit cards, car loans and insurance. With no ‘bricks and mortar’ branches, ME is an online-only bank.

ME has won various awards, including for Best Customer Experience at the Australian Lending Awards.

What savings accounts does ME have?

The ME Online Savings Account has no account-keeping or withdrawal fees. No minimum balance is required to open the account. You can earn a low base rate, but can also claim bonus interest. In order to qualify for the Online Savings Account’s bonus interest rate, you need to two things:

  • Have an ME Everyday Transaction Account
  • Use your Everyday Transaction Account card to make at least one ‘tap and go’ payment every seven days (processed in the same calendar month)

The bonus interest is calculated at the end of the month. Purchases made in a calendar month which are processed in the next calendar month (for reasons beyond ME's control) are not eligible purchases for bonus interest. If, at the end of the month, you have qualified for the bonus, you will see two interest payments for your Online Savings Account: one for the base interest rate and one for the bonus rate.

There are no monthly fees charged to your ME online savings account, nor any ATM or monthly fees.

What should I look for when choosing a bank account?

Before you begin comparing bank accounts to find the one that best suits your needs, it’s helpful to make a list of the features you want from your day-to-day banking.

You might want to consider things like:

  • How many transactions do you make each week/month?
  • Do you need extras like a cheque book?
  • Do you want internet banking?
  • Do you want a bank with branches and tellers?

If you make a lot of ATM and/or EFTPOS transactions each month, you might want to look at accounts that give you unlimited electronic transactions for a low (or even no) monthly fee. If you also want to make online purchases, then you might want to consider an account that comes with a debit card.

Do you think it’s likely that you’ll keep a high account balance from month to month? Then think about an account that pays good interest on your money, but still gives you the convenience of a regular everyday transaction account.

Also consider setting up a weekly or monthly direct deposit into your account – perhaps from your employer – especially when you’re first starting to save. It means you don’t have to think about it; you can just let your savings grow each week from your pay.

A few words on interest

When you’re ready to open a savings account, watch out for ‘bonus’ interest rates. These rates may be very competitive or better than average, but may only last for a limited time, or if you meet certain conditions (see below). There’s nothing wrong with opening an account to get a bonus interest rate, but make sure that when the bonus rate ends, the interest rate is still competitive.

Naturally, you’ll want to earn the best interest possible on your money. However, interest rates will depend on what kind of saver you are. Some accounts have bonus interest rates that offer higher-than-standard interest rates, but will likely come with set conditions you have to meet in order to qualify, such as making minimum deposits or not making withdrawals. If you don’t meet the requirements, then your interest rate drops, sometimes to zero. So it\'s a good idea to work out how much you can save each month so you know whether you will be eligible for the higher interest.

Or you might prefer to keep it simple by choosing a ‘no-strings-attached’ account. In that case, look for a good standard interest rate that will keep your savings growing without you needing to meet any extra requirements.

Remember, too, your savings account needs to return interest (after tax) at an annual rate that is higher than the annual inflation rate, in order for you to see a benefit in real terms on your savings. This is because interest earned on your savings accounts is treated as income, and so you will need to pay income tax on any interest that your account earns.

It can also be a good idea to review your interest rates every six to 12 months, and make sure they’re still competitive. You may find that there is a better account, with a higher interest rate, available somewhere else.