Xinja Bank, an Australia-based neobank, announced on Thursday it will move the interest rate on its Stash savings account to 1.8%, effective May 11th.
Xinja reported launched Stash, a savings account linked to your Bank Account (transaction account) designed for customers to save by separating money from daily spending Bank Account, with a 2.25% interest rate in January when Australia’s official cash rate was 0.75%. Since then, the Reserve Bank of Australia (RBA) has cut rates twice, with the first on March 3rd to 0.50% and then to 0.25% on March 19th, but Xinja has not dropped its rate until now. Speaking about ht interest cut, Xinja Founder and CEO, Eric Wilson, stated:
“We held the rate at 2.25% despite successive rate cuts from the Reserve Bank, and we are probably the only bank to have done that. We thought it was the right thing to do to protect our current customers rather than chasing new ones, and we achieved it through hitting a pause on opening any new Stash accounts.”
Xinja noted that Stash remains a ‘no strings attached’ account: no complex terms or conditions must be met to earn 1.8% interest; there’s no minimum balance required, no minimum spend, and customers do not have to access their account a set number of times to ensure they qualify for the rate. Stash customers will earn 1.8% on every dollar in Stash, up to a maximum of $245,000. The money is at-call and interest is calculated daily, as well as, paid monthly.
The Stash rate cut comes just two months after Xinja Bank announced it was hitting the “pause” button of opening new Stash Savings Accounts in order to maintain current rates for existing customers. Through the pause, Xinja Bank will hold the Stash savings account interest rate at a market-leading 2.25%, no strings attached. Interest is paid from the first dollar, up to $245,000, calculated daily and paid monthly.