RaboDirect touts new BankaRate term deposit offers a success as banks vie for domestic deposits

RaboDirect is touting its new online 'BankaRate' term deposit option as a success, with a six month deposit at 6% as the most popular offer, RaboDirect general manager Mike Heath said.

BankaRate offers a limited number of term deposit rates that are "typically" higher than offers from the major banks.

Banks have bee fighting for local term deposits in order to meet new Reserve Bank of New Zealand core funding ratio requirements for them to raise more funds from local sources, along with longer-term overseas borrowings. 

Heath's comments come after Kiwibank CEO Paul Brock told interest.co.nz this week that his bank's recently launched "Notice Saver" no-term deposit product had attracted "several hundred million dollars" within a few weeks of its launch.

See all deposit rates here for deposits up to one year, and here for one year and over.

Here is the release from RaboDirect:

Investors chasing great returns snapped up all RaboDirect’s six-month BankaRate term deposits in just 24 hours, says General Manager of RaboDirect, Mike Heath.

BankaRate offers a limited number of exclusive term deposit rates that are typically higher than comparable offerings from the major banks, on a “first in, first served” basis.

It was launched this week after a successful trial, and Mike Heath says that customers are benefitting from the increased competition between banks for retail deposits.

“The six-month term deposit rate, at six per cent, was the clear favourite of the BankaRate range. The first offer sold out within 24 hours,” he says.

RaboDirect then issued a second round of the same rate, which sold out overnight.

“As the country emerges from recession Kiwis are gravitating towards term deposits, which are typically viewed as a safer investment option. But while adjusting to an uncertain economic environment, people are not keen to lock their money away for long periods of time,” says Mike Heath.

“The six-month term deposit is particularly popular among New Zealanders – and having that top rate attached through BankaRate, from the country’s only triple A rated bank, makes it a really attractive proposition.”

The second set of BankaRate rates is now live on the RaboDirect website and is open to all RaboDirect customers.

“Customers can go online and choose the term deposit that suits them, and then follow some simple steps to purchase that rate. You can see how many special rates are left in real time, on the website,” says Mike Heath.

RaboDirect will offer BankaRate term deposits regularly up to Christmas, and may run rates sporadically in the New Year.