Macquarie Bank faces $14m penalty over confusing welcome rate promotion

How the promotion worked

In 2022, Macquarie Bank described its savings offer in promotional material as a “welcome variable rate” or “bonus”, according to the regulator. The wording could lead customers to believe the offer would be paid in addition to the standard variable rate.

In proceedings in the NSW Supreme Court, Asic alleged that customers received only the standard rate once it exceeded the promoted rate, with no bonus added. Macquarie is set to pay a $14m penalty imposed by the court.

Bonus rates can have conditions

A 2023 study by the competition regulator found 71% of bonus interest accounts did not receive the bonus rate in a given month because customers breached conditions. The conditions were often opaque, according to the study.

Savers may lose an advertised rate if they do not deposit money each month or grow their balance. Some products also require customers to make no withdrawals. Kirkland said higher advertised rates may be limited to a set period or depend on customers meeting conditions.

Why clear disclosures matter

Australia’s official interest rate is now 4.85%, an 18-year high, as elevated inflation persists. Zhong said clear and honest rate disclosures matter particularly in that setting because small wording differences can influence major decisions.