Knowledge Centre

Offset account balances rise 13.7%

30/09/2025

Borrowers are making greater use of their offset accounts and paying less interest as a result, based on the latest data from Australia’s banking regulator, APRA.

The total funds held by offset accounts in the June 2025 quarter was 13.7% higher than June 2024. Furthermore, offset balances represented 11.2% of all mortgage-related funds (outstanding home loans plus redrawable amounts) in June 2025, compared to 10.4% in June 2024.

What’s an offset account?

It’s a bank account linked to your home loan. Whatever money you keep in it is counted against your loan balance, which means you pay less interest. For example, if you owed $500,000 on your home loan and kept $20,000 in your offset, you’d pay interest on only $480,000 (i.e. $500k minus $20k) – not the full $500,000. On a 30-year loan at 5.68%, that could mean saving over $100 per month*.

When an offset account is useful:

• If you keep a good amount of savings or regular cash flow in your account.
• If you want the flexibility to access your money anytime, while still reducing interest.

When it may not be worth it:

• If your balance is usually low – the fee for an offset account might cost more than the interest you save.
• If a basic home loan with a lower interest rate would leave you better off.

* This example is for illustration only and does not take into account your personal circumstances. Savings will vary depending on your loan, interest rate, fees and charges. This information is general in nature and should not be taken as personal financial advice.