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The major bank has introduced a multiple offset feature in response to growing broker and customer feedback.
National Australia Bank (NAB) has announced that brokers can now help homeowners save money on interest annually by offsetting their mortgage across up to 10 different accounts.
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As of Monday (24 February), customers can use the self-service features in the NAB App to switch their current accounts structure into multiple offset accounts.
The new feature also allows customers to see how much they are saving on interest throughout the life of the loan.
Customers using multiple offsets linked to their Tailored Home Loan have the option to allocate funds for specific purposes, such as bills or major purchases. NAB said they can also separate money for everyday expenses to help avoid overspending and to manage their cash flow more clearly.
The offsets are also intended to help customers save for short and long-term needs like education, home renovations or retirement.
According to the major bank, the launch of multiple offsets was driven by an increase in demand for offsets by NAB customers since the pandemic, with around 70 per cent of new homeowners now offsetting their loan, up from 50 per cent in 2022.
Offset balances have increased by 65 per cent since the pandemic, reaching $48 billion, NAB added.
Commenting on the launch, NAB’s executive, broker distribution, Adam Brown, said that multiple offsets were introduced in response to broker and customer feedback and would enhance the ability for homeowners to manage their savings while giving brokers a new option to add value to customer conversations.
“Multiple offsets support the popular ‘bucketing’ strategy that many customers use to manage their savings and ease cost of living pressures. Customers who like to distribute funds across several accounts will no longer need to make a sacrifice between bucketing their savings and having it all in one account doing the heavy lifting on interest. They’re perfect for customers who are looking to make every dollar count,” Brown commented.
“Brokers are always there to guide customers to get great outcomes when it comes to home lending. Having multiple offset accounts provides more options for customers to manage their money and benefit from their saving habits.”
NAB’s executive, home ownership, Andy Kerr added: “Many Australians bucket their money into different categories to manage their budgets. With multiple offset accounts, they can continue doing this while also saving even more on their home loan interest. They no longer have to sacrifice one for the other.”
"We know traditional offset accounts have been homeowners’ secret weapon during times of higher interest rates and cost of living, and multiple offset accounts take those savings to the next level," Kerr said.
Westpac rolls out multiple offsets
NAB is the second major bank to launch multiple offsets this month, following hot-on-the-heels of Westpac, which announced a similar move last week.
Westpac will roll out multiple offset account options to home loan customers for no additional fee, as already offered by subsidiaries St.George, Bank of Melbourne, and BankSA.
The new feature – available by request through brokers on behalf of eligible customers – will enable customers with an eligible home loan to manage up to 10 offset accounts online from March or by visiting a branch/calling the bank.
Its move similarly came after the big four bank noted a strong trend of borrowers saving money in offsets.
Around $66 billion is now held by Westpac Group borrowers in offsets, with Westpac recording a 37 per cent increase in offset accounts opened over the past five years, as well as a 63 per cent increase in offset account balances over the same period.
Customers at all of the big four banks can offset their mortgage across at least one account.
ANZ offers one offset account, which customers can link eligible loans to for a fee of $10 per month.
The Commonwealth Bank of Australia (CBA) offers the Everyday Offset account as its main offset account option, letting customers link up to 99 offset accounts to a single eligible home loan.
[Related: Westpac offers multiple offsets, tweaks rates as competition rises]
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