How to Understand the Fees on Your Australian Bank Account

When you open a bank account in Australia as an international student, it feels simple at first. But then you check your balance and notice money has disappeared for reasons you don't understand. Bank fees are one of the easiest ways to leak money without realizing it - especially when you're managing money far from home for the first time.

This is general information only, not financial advice. The Afrovo team is not a licensed financial adviser. For detailed advice on your specific account and fees, check ASIC MoneySmart or contact your bank directly.

What Are Bank Fees?

Bank fees are charges your bank takes from your account for services, transactions, or account maintenance. Some fees are obvious (you see them coming). Others are sneaky and buried in your account terms. The good news: most student accounts have low or zero monthly fees, but you need to know where the hidden charges hide.

Let's break down the main types of fees you'll encounter.

Monthly Account Fees

What They Are

Some banks charge you just to have an account open. This might be called an "account keeping fee" or "monthly service fee" - typically between AUD $5 and $15 per month. Other banks, especially those with student accounts, charge nothing.

How to Check

Open your online banking app or log into your account online. Look for a statement from the past month. Scroll to the bottom and search for words like "account fee", "monthly fee" or "service fee". If you see a regular charge every month, that's a monthly fee. If you don't see one, you're lucky - your account is likely fee-free on this.

How to Avoid It

When you're choosing a bank account, ask directly: "Is there a monthly fee?" Some banks waive the fee if you keep a minimum balance (often AUD $500-$2,000) or pay your salary into that account. Compare a few banks before you commit. Read the student bank account guide for account options.

ATM Fees

What They Are

When you withdraw cash from an ATM that doesn't belong to your bank, you may be charged a fee. This is usually AUD $2-$3 per withdrawal. Some ATMs charge both your bank and the ATM operator charges you a fee - that's two bites out of your money.

How to Check

After you withdraw cash, check your balance immediately (in the app or at another ATM). If the amount withdrawn is more than you asked for, you've been charged a fee. It shows up as a separate line on your statement.

How to Avoid It

Use ATMs run by your own bank. Most banks have a network of "in-network" ATMs where withdrawals are free. If your bank is small, you might have fewer free ATMs - this is worth checking before you open an account. Plan your cash withdrawals so you visit an in-network ATM. If you must use an out-of-network ATM, ask the screen before you confirm: it usually shows the fee upfront.

Overseas Transaction Fees

What They Are

If you use your Australian debit card overseas or buy something online from a foreign merchant (like a website based in the US), your bank may charge a foreign exchange fee (usually 2-3% of the amount) plus a transaction fee (AUD $5-$10). This adds up fast if you're buying things from home or sending money internationally.

How to Check

If you've made a purchase or withdrawal overseas, check your statement. Look for a line that says "international transaction fee" or "foreign exchange fee". The amount will be deducted separately from the purchase price.

How to Avoid It

Use a money-transfer service registered with AUSTRAC to send money home instead of using your debit card. For online shopping from overseas, some banks offer a fee waiver if you use their international debit card or account features. Check with your bank. For a detailed guide, see our post on comparing money-transfer services safely.

Dishonour and Overdraft Fees

What They Are

If you try to withdraw or pay more money than you have in your account, the bank may charge you a "dishonour fee" (AUD $15-$35) or allow you to go into overdraft, which charges interest on the amount you've borrowed. Some banks charge both.

How to Check

If you've ever received a message that a payment has been rejected or "bounced", check your statement. A dishonour fee will appear as a single large charge. If you've been allowed to go negative, your balance will show a negative number, and you'll see interest charges on your next statement.

How to Avoid It

Set up a balance alert on your phone. Most banks let you get a notification when your balance drops below a set amount (like AUD $100). This gives you time to move money in before a payment bounces. Never allow your account to go into overdraft unless you've agreed to an overdraft facility - even then, it's expensive. Check the Fair Work site for pay and work rights if you're waiting for a late wage.

Transfer Fees

What They Are

Some banks charge a fee every time you transfer money between your own accounts, to another person's account, or to an international account. Domestic transfers (to another Australian account) are usually free, but some banks charge AUD $10-$20 per international transfer.

How to Check

If you've sent money to a mate or back home, check your statement for a line saying "transfer fee" or "bank fee-international transfer". It will be listed separately from the amount you transferred.

How to Avoid It

For transfers within Australia, use your bank's standard transfer - it's free. For sending money home, use a registered money-transfer service (AUSTRAC-registered) instead of a bank transfer; they're usually cheaper. See how to compare money-transfer services for details.

Cheque Fees

What They Are

If your bank still offers cheques (some do, some don't), you may pay to order them, deposit them, or have them dishonoured. This is rare for students, but worth knowing.

Inactivity Fees

What They Are

Some accounts charge a fee if you don't use them for a set period (usually 12 months). This is uncommon in student accounts but can happen.

How to Check

Read your account's terms and conditions (ask your bank for a copy, or find it online). Search for "inactivity".

A Simple Fee Comparison Table

How to Keep Fees Low: A Checklist

Read your account's product disclosure statement (PDS) before you open it. Ask your bank directly about every fee type listed above. Choose a student account with no monthly fee. Set up balance alerts so you never overdraw. Use only in-network ATMs. Send money home via AUSTRAC-registered providers, not your bank.

Scam Warning

Scammers sometimes pose as your bank and claim there's a "fee dispute" or "unusual activity" and ask you to "verify" your details. Your real bank will never ask for your password, PIN or full card number via email, text or phone call. If you're unsure, hang up and call your bank's official number (on the back of your card). Report suspicious messages to Scamwatch.

Frequently Asked Questions

Q: Are student bank accounts always free?

A: Most are, but not all. Some waive the monthly fee but still charge ATM or transfer fees. Always ask. Check the product disclosure statement (PDS) or talk to the bank directly before you open an account.

Q: Can I dispute a fee my bank charged me?

A: Yes. Contact your bank's complaints department and explain why you think the fee was wrong. If they refuse, you can lodge a complaint with the Australian Financial Complaints Authority (AFCA) for free. ASIC MoneySmart has a guide to how to complain about a financial service.

Q: Why does my bank charge me to withdraw money from another bank's ATM?

A: The ATM owner charges your bank a fee to use their machine, and your bank passes that on to you. It's the cost of convenience. In-network ATMs are free because they're part of your bank's network.

Q: If I don't use my account for a year, will I lose my money?

A: No. Your money stays in the account. But some banks charge an inactivity fee. Check your account terms. Money you don't claim after seven years may go to the ATO's Unclaimed Money scheme - you can reclaim it, but it's easier to just use your account.

Q: What's the difference between a fee and interest?

A: A fee is a one-off or regular charge for a service (like ATM access). Interest is money you owe if you borrow from the bank (like an overdraft). Both cost you money, but interest compounds over time if you don't pay it back.

Summary

Bank fees are designed to catch you off guard. The good news is that most are avoidable if you know what to look for and plan ahead. Choose a student account with no monthly fee, use only in-network ATMs, keep a balance buffer to avoid overdraft fees, and use a money-transfer service for sending money home.

Start by reading your account's terms and conditions, then set up balance alerts on your phone. Check your statement every month and ask your bank about anything you don't understand. For a wider look at managing your money as a student, visit our student finance hub and explore ASIC MoneySmart's free guides to banking fees and charges.

Your money works hard enough without the bank taking bites out of it. Now you know where those bites come from - and how to protect yourself.