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Rural Bank Term Deposits

Name: Rural Bank Term Deposits
Creator: Savvy
Published: 2022-09-26T16:37:12+09:30

Explore Rural Bank's term deposit offers and interest rates to help you compare your options with Savvy.

Written by , updated on September 11th, 2023

Rural Bank was formed in 2000 as a partnership between Bendigo Bank and Elders Ltd. It was previously known by many of its rural customers as Elders Rural Bank but changed its name in 2009 to become simply Rural Bank.

It's now a fully owned subsidiary of the Bendigo and Adelaide Bank, offering a range of retail banking services including term deposits and farm management deposits to customers throughout Australia.

Discover if Rural Bank is the best place to park your savings by comparing their interest rates here with Savvy. Find out if their terms suit your personal needs before starting your investment journey right here with Savvy.

*Please note that Savvy does not represent Rural Bank for its term deposit products.

Rural Bank term deposits explained

What term deposits does Rural Bank offer?

Rural Bank offers term deposits ranging from one month right up to five years.

Rural Bank term deposit interest rates

Term length offered	Interest rate $500 to $4,999	Interest rate $5,000 to $500,000
1 month	0.05% p.a.	0.10% p.a.
2 months	0.05% p.a.	0.10% p.a.
3 months	0.05% p.a.	0.20% p.a.
4 months	0.05% p.a.	1.20% p.a.
6 months	0.10% p.a.	0.75% p.a.
9 months	0.10% p.a.	2.00% p.a.
1 year	0.15% p.a.	2.50% p.a.
2 years	0.15% p.a.	2.80% p.a.
3 years	0.15% p.a.	2.85% p.a.
4 years	0.15% p.a.	2.90% p.a.
5 years	0.15% p.a.	2.90% p.a.

(Effective 26 September 2022)

The interest rates listed above are for interest paid at maturity or annually (for deposits of 12 months or longer). For those wanting interest to be paid more frequently, such as monthly or quarterly, interest rates are slightly lower. There is also an online-only term deposit on offer, known as the Rural Bank ONE Online Personal Term Deposit, with interest rates slightly higher than those quoted for terms of three, six and 12 months only.

Minimum and maximum deposit limits

The minimum amount you can invest is $500, although the interest rates on offer for amounts between $500 and $5,000 are very low. The maximum investment amount is $500,000, although for a farm management deposit this is set at $800,000. The ONE online term deposit comes with a maximum balance of $2 million.

Farm management deposits and FMD offset accounts available

Rural Bank also offers farm management deposits (FMDs) and a FMD offset account. These specialist term deposit accounts are designed by the ATO to offer farmers a way to even out their income over good seasons and bad. In good years, funds can be tucked away for a minimum of 12 months. No tax is payable on that income until the funds are withdrawn during lean years. In this way, farmers can even out their income and not pay excessive tax in boom years, only to drop into negative income figures during leaner times.

A FMD offset account works in a similar way to a term deposit. However, rather than interest being earned on the deposit, the deposit acts as an offset to a home or business loan, thus reducing the interest paid on these long-term loans.

FMDs offer a fixed rate of interest with interest paid either quarterly, half-yearly or at maturity depending on the term chosen. However, variable rate FMDs are also available. Rural Bank interest rates for FMDs are very reasonable and comparable with the best interest rates offered by other smaller banks.

Business and SMSF term deposits

Rural Bank also offers term deposits for businesses, trusts and self-managed super funds, which are known as DIY Super term deposits. These are available for three, six or 12 months at the same interest rates as those for online personal term deposits through Rural Bank ONE.

Notice for early withdrawal

If you decide to withdraw funds from your term deposit prior to the maturation date, you’re required to give 31 days’ notice. A reduction in interest will result, which will be calculated by allocating the interest rate which is nominated as the bank’s ‘interest earning at call’ rate. This rate could be far lower than the rate you’d previously been quoted.

How do I open a Rural Bank term deposit?

Rural Bank online term deposits can only be opened online, as their name suggests. As part of the online application process, you’ll be required to submit identification documents to prove your ID. The documents you’ll require will depend on the type of term deposit you wish to open online.

Standard term deposits can be opened by calling the customer service team or by visiting your nearest Rural Bank branch. Applications can also be made at Bendigo Bank and Community Bank branches.

What are the requirements for opening a Rural Bank term deposit?

The requirements for opening a term deposit with Rural Bank are as follows:

The minimum age limit to open a term deposit account is 12 years old
For children under the age of 12, a term deposit can be opened in the child’s name as an informal trust account with the minor as a beneficiary
You’ll need to be an Australian citizen or permanent resident
You’ll need to provide satisfactory identification depending on whether you’re applying as a private individual, a trust, a business or a DIY super fund
For an individual, 100 points of ID will be required which could include your passport and driver’s licence

The pros and cons of Rural Bank term deposits

PROS

Interest can be paid to another account

The interest earned on your term deposits can either be paid into an account with Rural Bank or to a bank account you hold with another bank.

Competitive interest rates

Some of the interest rates on offer from Rural Bank are very competitive and offer good value for your savings.

Wide range of account types

Rural Bank can cater to almost all the needs of their customers in the agricultural sector, with personal and business term deposits, farm management deposits and offset deposits and many other savings options available to farmers.

CONS

Limited terms for online accounts

For those wanting to open an online term deposit account, you are limited to terms of three, six and 12 months only.

Low interest rates for small deposits

The interest rates on offer for small deposits under $5,000 are not impressive, so for small deposits, you may need to look elsewhere to get a better deal.