A properly linked offset account should reduce the balance used to calculate interest on your home loan – but a recent ASIC review shows that’s not something borrowers should simply take for granted.
As we highlighted in our email on 31 July, ASIC reviewed eight banks representing more than 70% of Australia’s home loan market and found weaknesses in how all eight set up, monitored and managed offset accounts.
Between September 2023 and August 2025, banks paid more than $55 million in compensation for offset failures, with further compensation expected.
The problem can be hard to spot
ASIC also warned that common loan changes, such as refinancing or switching loan products, can result in an offset account becoming disconnected from the loan.
And when an offset isn’t working correctly, your repayments may not change.
Instead, more of each repayment can go towards interest and less towards reducing your principal – potentially leaving you worse off without realising it.
That’s why it’s worth checking that your offset is properly linked to your loan and that you’re receiving the interest savings you expect. If you’re unsure, We can help you understand your loan structure and what to check with your lender.
