Household term deposit balances have flat-lined since early 2024. But now that bank offer rates are rising, with 4%-plus rates even offered by some main banks, will that encourage savers to move back?

Rising wholesale rates have driven rising fixed home loan rates. They have also brought higher term deposit (TD) rates as well. But mostly only for rates one year and longer. Rates shorter have remained very stable, and quite low.

As the table below shows, a number of banks now offer 4% or higher TD rates for two years and longer. In fact both ANZ and Westpac now offer some of the highest rates for those terms, and it is unusual to find main banks offering market-leading term deposit rates.

We are also seeing the return of finance companies offering even higher rates. They had stepped their offers back as they learned how the fees related to the Depositor Compensation Scheme (DCS) applied to them. And with some signs of improving loan demand, they find they need to offer more to attract the funds they require.

This could well mean that borrowers will be effectively paying for the DCS costs, unexpected because some, including us, thought those costs would likely fall on savers. The early 2026 evidence is that this isn't so.

As we are in the middle of rate change activity by institutions, that is, some have moved already, others have yet to move, there remains an open question as to where this will all settle. We will be looking for a bank to adopt a 4% rate for 18 months - or even one year. Savers will start to be motivated by interest rates if, or when, that happens. Savers are reticent to park cash funds for terms longer than one year. Most is parked for less than one year, and with rates in that timeframe being quite low, and seeming to hold low, we have seen funds no longer moving into term deposits.

When you invest, always check how interest is compounded. Depending on how much you are committing, compounding more often is materially better. But some banks advertise their "interest at maturity" rates different to their compounding rates, which for some can be set a little lower. Both Kiwibank and Rabobank do this, although most other main banks don't.

Use the calculator at the foot of this article to see the differences.

We should also point out that after-tax returns can be enhanced for some savers with higher tax rates by the choice of PIE structures. Not all institutions offer these, but most of the main banks do.

Always ask a bank for a better rate. Many bank staff have discretion to offer more than the advertised rate. (And check your bank's app offers as they too are often enhanced to retain you). We have been surprised to hear recently of even big banks agreeing to a small boost, when asked.

Use the term deposit calculator here, or the one below the table, to calculate your expected net after-tax returns.

The latest headline term deposit rate offers are in this table after the recent changes over the past three weeks. The yellow colour code is for those under 4% and has spread comprehensively. Bolded rates are the "best-bank", the highest carded rate from any bank at this time. The blue-coded rates are those under 3%.

This table only lists institutions covered by the Depositor Compensation Scheme.

for a $25,000 deposit March 19, 2026	Rating	3/4 mths	5/6/7 mths	8 - 11 mths	1 yr	18mth	2 yrs	3 yrs
Main banks
ANZ	AA-	3.10	3.45	3.40	3.70	3.80	4.10	4.40
	AA-	3.00	3.45	3.55	3.50	3.65	4.00	4.15
	AA-	3.00	3.45	3.45	3.60	3.65	4.00	4.10
	A	3.10	3.55	3.40	3.55		4.00	4.10
	AA-	3.00	3.45	3.50	3.75	3.80	4.10	4.40
Kiwi Bonds. 'risk-free'	AA+		2.25		2.50		3.00
	Rating	3/4 mths	5 / 6 / 7 mths	8 - 11 mths	1 yr	18mth	2 yrs	3 yrs
Other banks
Bank of Baroda	BBB-	3.35	3.65	3.60	3.60	3.60	3.65	3.85
Bank of China	A	3.30	3.60	3.50	3.70	3.80	3.90	4.00
Bank of India	BBB-	3.25	3.70	3.70	3.70	3.80	3.85	3.85
China Constr. Bank	A	2.70	3.20	3.20	3.20	3.25	3.25	3.45
Co-operative Bank	BBB+	2.90	3.45	3.50	3.60	3.65	3.90	4.10
Heartland Bank	BBB	3.00	3.45	3.70	3.60	3.85	4.00	4.15
ICBC	A	3.25	3.60	3.50	3.65	3.70	3.75	4.00
	A	3.05	3.50	3.45	3.60	3.65	3.85	4.10
	BBB	3.00	3.45	3.55	3.55	3.75	4.00	4.15
	BBB+	3.00	3.45	3.50	3.55	3.60	3.85	4.00
Non-Bank Deposit Takers	Rating	3/4 mths	5 / 6 / 7 mths	8 - 11 mths	1 yr	18mth	2 yrs	3 yrs
Community institutions with DCS protection
First Credit Union	BB	3.40	3.80	3.80	3.80	3.70	3.70
Heretaunga Bldg Society		3.05	3.55		3.75		4.15
Nelson Building Society	BB+	2.75	3.40	3.50	3.55	3.80	4.00	4.15
Police Credit Union	BB+	3.00	3.45	3.45	3.50	3.55	3.65
UnityMoney	BB	3.00	3.45	3.40	3.35	3.50	3.55	3.55
Wairarapa Bldg Society	BB+	3.10	3.45	3.45	3.75	3.75	3.85
Finance companies with DCS protection
Christian Savings	BB+	3.00	3.50	3.55	3.60	3.75	4.10	4.15
Finance Direct			4.10		4.25	4.35	4.50	4.60
General Finance	BB	3.40	3.65	3.85	4.15	4.35	4.45	4.65
Gold Band Finance	BB-		2.75	2.75	4.10	4.30	4.40	4.60
Liberty Financial	BBB	3.10	3.80	3.80	4.00	4.10	4.20	4.30
Mutual Credit Finance	B+				4.15	4.25	4.35	4.50
Welcome			4.00	4.00	4.05	4.15	4.25	4.30
Xceda Finance	B+		3.70	3.90	4.10	4.30	4.40	4.45