A transaction account is an account you use for day-to-day banking such as paying bills and getting your wages.
Transaction accounts are often called 'everyday accounts'.
When you choose a transaction account, compare the account features and choose a no-fee or low-fee account.
What to look for in a transaction account
Most transaction accounts come with a debit card for withdrawing cash and making purchases.
Low-fee or no-fee
Some transaction accounts charge monthly account-keeping fees and other fees for things like ATM withdrawals and internet banking.
Think about your spending habits and choose the account with the lowest fees. For example, if you often use ATMs, choose an account that has low or no ATM fees.
The best option is a no-fee account.
Basic bank accounts
If you're on a low income, you may be able to get a 'basic bank account' which has:
- no account-keeping fees
- free monthly statements
- no minimum deposit amount
- no overdraft fee
For information about eligibility, see the list of basic bank accounts on the Australian Banking Association website.
Debit versus credit cards
When you use a debit card to pay for things, you are spending the money in your account. If there's no money in the account, you can't make a purchase.
When you use a credit card, you borrow money that you will have to pay back with interest.
Using a debit card is less risky than using a credit card, because you can't run up a debt.
Some debit cards are 'dual network cards', which means you can also use them as a credit card. If you do use your debit card as a credit card, you could be charged high interest. You might end up paying more than you would on a regular credit card.
If you are switching from a credit card to a debit card to avoid debt, make sure your debit card does not have a credit option.
Contactless payments
Most debit cards have a contactless payment option, like Visa's payWave or Mastercard's PayPass. This means you don't have to insert or swipe your card or use your PIN for transactions under $200.
Many accounts also have 'digital wallet' options such as Google Pay and Apple Pay. These allow you to pay for things with your smartphone or smartwatch instead of using a card.
Check what your options are when you choose your transaction account.
Overdraft fees
If you withdraw more money than is in your account, it's called going into overdraft.
If you go into overdraft, you may have to pay hefty fees and interest.
Make sure you regularly check your account balance. Leave enough in your account for any automatic payments that you've set up, like direct debits.
You have the right to share your data between banks and service providers of your choice. Find out if your bank is accredited at the Consumer Data Right.
Compare transaction accounts
Compare transaction accounts to find the one with the lowest fees and a debit card that suits your needs.
Your current provider's default transaction account may not be the best option.
Comparison websites can be useful, but they are businesses and may make money through promoted links. They may not cover all your options. See what to keep in mind when using comparison websites.
Compare these features:
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Account fee |
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Account access |
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Contactless payments |
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Overdraft fees |
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International transactions |
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Branch fees |
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Cheque fees |
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Review regularly for better features
Banks often offer new accounts with competitive features. Compare the fees and features and consider switching bank accounts if you find one that suits you better.