Savers short-changed as banks scrimp on rate rises

Banks are defying political pressure by not passing on cash-raising higher interest rates to all savers as they hit mortgage holders with full, rapid-fire increases.

Complacent savers are still missing out as Australia's big four banks continue to offer the best rates to new customers or on bonus accounts that have strings attached.

All four - Commonwealth Bank, NAB, Westpac and ANZ - have passed on the latest full 0.25 percentage point hike to their variable rate mortgage customers but the coverage across their deposit products remains hit and miss.

That's despite mounting political pressure on them to pass rates on to both savers and mortgage holders, with the Australian Competition and Consumer Commission launching an investigation into the matter this year.

But RateCity research director Sally Tindall said the big banks had already sharpened their game before the ACCC investigation was flagged in January, with market competition, customer churn and a growing appetite for new deposits likely spurring them to offer better rates.

Despite that, she told AAP there was still a tendency to "pick and choose" which products to lift rates across, with new customers and conditional accounts enjoying the best deals.

After the last 0.25 percentage point hike on Tuesday, Westpac and NAB both passed on the full increase to their main savings accounts.

But ANZ only applied the full increase to their relatively new Plus Save account, leaving their other main accounts unchanged.

Commonwealth Bank passed on the full hike to its online saver and its kids saver accounts but only lifted rates on its popular bonus saver account by 0.15 per cent.

Ms Tindall said it was now possible to source an ongoing rate on a savings account above four per cent from the major banks - above the RBA's official rate - but customers would likely need to meet the terms and conditions on these bonus accounts.

These conditions aren't necessarily onerous and may just ask customers to grow their balances each month and make no withdrawals.

But Ms Tindall said the higher rate accounts tended to have more complex conditions attached.

"We recommend picking one that suits you - don't pick a deposit account that doesn't have terms and conditions you can easily meet," she said.

On their standard online saver accounts, banks are also offering competitive rates to new customers but rates for existing customers can be less than half the official cash rate.

Looking beyond the big four, smaller banks are offering the most competitive rates on deposits. 

The highest ongoing rate on offer is a Bank of Queensland product for young adults, coming in at 5.15 per cent.

For adults, ING's Savings Maximiser account attracts the highest ongoing interest rate at five per cent.