bank protect money

How Australian banks protect your savings

Your money is protected by the Australian Government Guarantee Scheme.

The Australian Government guarantees deposits up to $250,000 in Authorised Deposit-taking Institutions (ADIs) such as banks, building societies or credit unions. This means that this money is guaranteed if the institution collapses.

This cap applies per person and per ADI. If you have separate accounts with different protected banks with less than $250,000 in them, you will be covered for both accounts. If you have more than $250,000 in a single account, you won't be covered for the amount over $250,000. If you have $250,000 with two different "brands" but they're operated under the same ADI, you'll only get $250,000 in total.

It’s important to understand that the government guarantee covers the underlying ADI, and not different brands. Some ADIs offer multiple accounts under different brand names (such as Westpac and St.George). If you have multiple accounts under different brand names but all under one ADI, the guarantee only applies to the ADI and not the different brands.

Philip wonders if his deposits are guaranteed by the Government Guarantee

philip-case-study

Philip currently has $250,000 deposited into a bank account with NAB and another $250,000 deposited into UBank.

After doing some further research, Philip has realised that UBank is a brand under NAB, so he decides to move some of his money to a CommBank savings account. Commbank is not a brand under NAB.

You might need to double check with your ADI to make sure that you don’t fall into this trap. For joint accounts, each person is entitled to an individual guarantee. For example, for a joint account holding two people, the account is covered up to $500,000. Find out if your bank is a sub-brand of a larger ADI here.

What types of accounts does the guarantee cover?

The government guarantee covers a multitude of accounts, including:

What types of accounts doesn't the guarantee cover?

What happens if the bank goes bankrupt?

Are you still protected under the guarantee if your bank goes bankrupt? The short answer is yes. If your ADI is mentioned on the list below, it’s covered by the guarantee. So if you have money in an institution that goes bankrupt, you are protected so long as your account balance doesn’t exceed $250,000.

There are many Australian-owned banks and foreign subsidiary banks that are covered by the Australian Government Guarantee Scheme. The full list is below:

Australian-owned banks:

Foreign subsidiary banks

An exhaustive list of ADIs

Shirley Liu

Shirley is finder.com.au's publisher for banking and investments. She has completed a Masters in Commerce (Finance) and is the author of hundreds of articles. She is passionate about helping Aussies make an informed decision, save money and find the best deal for their needs.

Was this content helpful to you? No  Yes

Related Posts

Savings Account Offers

Learn about our information service
ME Online Savings Account

Maximum Variable Rate

2.95

Standard Variable Rate

1.30
Citibank Online Saver

Maximum Variable Rate

2.85

Standard Variable Rate

1.70
Bankwest Hero Saver

Maximum Variable Rate

2.60

Standard Variable Rate

0.01

Ask an Expert

You are about to post a question on finder.com.au:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com.au is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, read the PDS or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms and Conditions and Privacy Policy.

6 Responses

  1. Default Gravatar
    NomAugust 9, 2017

    Hi, do you know if UBank is covered by the government? Thanks!

    • Staff
      JasonAugust 9, 2017Staff

      Hi Nom,

      Thank you for your enquiry.

      Deposits on UBank are guaranteed free of charge under the Government Financial Claims Scheme of up to $250,000 per customer per institution.

      Please check out this page for a comparison of UBank Transaction and Savings Accounts for your reference.

      Kind regards,
      Jason

  2. Default Gravatar
    jamieJuly 24, 2017

    hi,just wondering if i invest in ipo wealth is it covered by the government or another identiy.

    • Staff
      ArnoldJuly 25, 2017Staff

      Hi Jamie,

      Thanks for your inquiry.

      IPO Wealth Fund is a private company and is covered by private entities.

      An investment in the IPO Wealth Fund (Fund) is not a bank deposit or liability of the issuer and is subject to a greater risk of loss of capital than a cash investment product. Target returns only. Returns are not guaranteed and there is a risk of negative returns. The contents of this document are not intended as financial product advice and have been prepared without taking into account your investment objectives, financial circumstances or particular needs. You should read the Information Memorandum (IM) for the Fund in full to consider whether an investment is appropriate for you. The IM for the Fund is available at http://www.vascofm.com.

      IPO Wealth Pty Ltd ACN 617 039 255 (IPO Wealth) is investment manager of the IPO Wealth Fund (Fund). IPO Wealth is authorized by D H Flinders Pty Ltd ABN 16 141 601 596 AFSL 477782 (D H Flinders) as a corporate authorized representative (No. 001253092) to provide investment management services in respect of the Fund and in no other capacity. Vasco Investment Managers Limited ACN 138 715 009 AFSL 344486 (Vasco) is a trustee of the Fund and the issuer of the Fund’s Information Memorandum (IM).

      IPO Wealth only provides its services in respect of the Fund to wholesale clients, as defined in s761G of the Corporations Act.

      Neither IPO Wealth, D H Flinders, Vasco or any other party guarantees any income or capital return of the Fund. We strongly recommend that you seek your own professional financial and legal advice prior to any investment decisions.

      Hope this information helped.

      Cheers,
      Arnold

  3. Default Gravatar
    TessMay 8, 2017

    Hi,

    I was just wondering if the government guarantee covers business accounts?

    Thank you.

    • Staff
      MayMay 8, 2017Staff

      Hi Tess,

      Thank you for your inquiry.

      Are you pertaining to the business bank accounts such as but not limited to savings/deposit/transaction accounts? If so, yes. As quoted from the page ASIC’s page relate on banking under “Government guarantee on deposits”

      The types of accounts covered by the guarantee are: savings accounts; call accounts; term deposits; current accounts; cheque accounts; debit card accounts; transaction accounts; personal basic accounts; cash management accounts; farm management deposits; pensioner deeming accounts; mortgage offset accounts, either 100 per cent or partial offset that are separate deposit accounts; trustee accounts; and retirement savings accounts.

      The Australian Government has guaranteed deposits up to $250,000 in Authorised Deposit-taking Institutions (ADIs) such as your bank, building society or credit union.

      If you’re unsure whether your business account is guaranteed, you’d be best to directly contact your financial institution.

      Cheers,
      May

Ask a question
feedback