Canstar's 2026 Term Deposit Awards recognise the bank and customer-owned bank delivering the strongest combination of competitive interest rates and product features across their term deposit offerings. We assess across a range of term lengths and deposit amounts, scoring both the rates on offer over a six-month observation period, and the full customer journey, from application through to maturity.

We recognise two winners – one from the banking sector and one from the customer-owned banking sector, which includes mutual banks, credit unions, and building societies. We assess them separately because they tend to compete in different ways. In this year's assessment, customer-owned banks were generally more competitive on rate, while banks offered stronger digital and self-service features.

As a consumer, it's important to know that, whether you choose to do business with a bank or a customer-owned bank, your deposits are protected in the same way under the Financial Claims Scheme (the FCS) – the regulatory framework treats them equally to ensure the safety of your money.

The market this year

Australian household savings have reached a record $1.74 trillion as of April this year, representing approximately 8% growth year-on-year. Despite cost-of-living pressures, Australians are increasing their savings, suggesting a preference for capital security over higher-risk investments in the current environment.

The term deposit market remains divided between established banks and smaller challengers. While the big four banks hold the largest share of household deposits, they generally offer lower standard interest rates. At the close of our six-month observation period, the highest rate offered by a big four bank for an 8-to-13-month term was 5.25%, compared to a market-leading rate of 5.55%, on offer from multiple customer owned banks at the time. Mid-tier lenders, credit unions, and mutual banks continue to compete for market share by offering higher yields.

In broader industry developments, term deposit maturity has come under increased scrutiny over the last year. Many consumers signing up for term deposits don't realise that when a promotional rate ends, their deposit can automatically roll over into a significantly lower standard rate – sometimes without clear notice. New industry safeguards introduced in 2025 now require banks to provide clearer disclosures around interest calculations and maturity handling, and ASIC has standardised communication requirements for 31-day notice products.

Our methodology goes further. When looking at term deposit rates, we don't just look at a single term – we score across a broad range. This means that we can identify where a provider appears competitive by offering an appealing intro rate, only to offer a much lower rate when the term deposit rolls over. We also evaluate the way that providers inform customers about maturity across all term deposit products, not just the product types covered by the new regulations, to ensure providers are keeping customers informed before their rates expire.

The assessment follows a customer's journey with a term deposit from start to finish, weighted to reflect what matters most at each stage.

The largest share of the score (90%) goes to the management phase – this is primarily the interest rate offered across various terms and deposit amounts, assessed over 26 observation dates across a six-month period. This means a provider can't score well on a single competitive rate snapshot; they need to offer consistent pricing over time.

The remaining score covers the application experience (3%), including account opening options and tools to help choose the right term; customer support (2%), including access to service representatives; and the maturity experience (5%), covering rollover options, maturity alerts, and any costs associated with retrieving funds at the end of the term.

We assess banks and customer-owned banks separately because the two operate in different competitive environments – big four banks tend to compete on scale and brand, while customer-owned banks often compete on rate and service. Separating them ensures a fair comparison.

To be eligible, a provider must be an authorised deposit-taking institution (ADI) offering term deposits available directly to individuals – not limited to a specific age group or membership. This year, we assessed 83 products across 70 providers.

Interest rates are the biggest factor in term deposit value, but they're not the only one. What happens at maturity matters too – if your term deposit automatically rolls over into a lower standard rate, the value you locked in can quietly disappear. Check whether your provider sends maturity alerts and what rate applies if you don't act before rollover. If you're not satisfied with your rollover rate, you'll be pleased to know that most providers offer a period of time where you can make adjustments without penalty, even if your deposit has rolled over.

The gap between big four banks and smaller providers can be meaningful. At the close of our observation period, the difference between the highest big four rate and the market-leading rate for an 8-to-13-month term was 0.30%. That number may seem small, but on a large deposit, that difference of 0.30% can mean much more money in your pocket.

If you need access to your funds before maturity, check the early withdrawal terms. Some providers offer more flexibility than others, and penalties vary.

Before making a decision, review the relevant terms and conditions and product disclosure statement from the provider.

With a background in Telecommunications and Financial Planning, Luke brings a breadth of experience to his mainly insurance based portfolio of Star Ratings and Awards.

Returning to university to complete his Bachelor during Covid, Luke is passionate about delivering actionable data to assist Australians in making informed financial decisions. Luke is delighted to discuss the minutia of each product he researches, determined to fully comprehend the details. He revels in improving efficiency, adopting new technologies and methods to better achieve high quality results.

Luke values expertise in all forms and is excited to have found a group of like minded individuals in the Canstar Research Department. You can follow Luke on LinkedIn.

Alasdair is Canstar's Deputy Finance Editor, specialising in home loans, property and lifestyle topics. He has written more than 200 articles for Canstar and his work is widely referenced by other publishers and media outlets, including Yahoo Finance, The New Daily, The Motley Fool and Sky News. He has featured as a guest author for property website homely.com.au.

In his more than 15 years working in the media, Alasdair has written for a broad range of publications. Before joining Canstar, he was a News Editor at Pedestrian.TV, part of Australia's leading youth media group. His work has also appeared on ABC News, Junkee, Rolling Stone, Kotaku, the Sydney Star Observer and The Brag.

He has a Bachelor of Laws (Honours) and a Bachelor of Arts with a major in Journalism from the University of Queensland. When he is not writing about finance for Canstar, Alasdair can probably be found at the beach with his two dogs or listening to podcasts about pop music. You can follow Alasdair on LinkedIn and X, and view his articles here.