It's a hard life for savers. While the banks raise interest rates on those with risky mortgages, they've only lowered them for those putting their money into term deposits.

Term deposit interest rates have been declining since 2010, and are now at their lowest point in recent memory.

According to research by financial comparison company Canstar released on Wednesday, only 15 of 75 lending institutions have increased the interest rate on any of their term deposits since August, when the Reserve Bank lowered the cash rate to a record low of 1.5 per cent.

The major banks rely on deposits for around 60 per cent of their funding, while the figures are often higher for second and third-tier lenders. But for the most part, they're not paying much for this funding, even as the average differential on lending for mortgages swells to 350 basis points above the cash rate, a figure that's doubled since 2007.

Banks are charging a rate of around 5 per cent per annum for mortgages. But even five-year term deposits for a $25,000 deposit are only, on average, earning savers 2.73 per cent per annum, with the best-in-market rate being 3.15 per cent.

These rates are significantly below those paid by banks during the global financial crisis. Rates of above 3 per cent were common, even on short-dated term deposits, while rates over 7 per cent could be had for savers willing to park their money with a bank for a year or longer a decade ago.

No imminent change

Canstar group executive for financial services Steve Mickenbecker said it was the lowest he'd ever seen term deposit rates. While he believes savers in long-term deposits in previous years have done well out of it, putting your money into a five-year account would be a "brave call" now.

"Savers are the big losers from what's going on here," he said of the current monetary environment.

"At this stage, the Reserve Bank hasn't had to move on interest rates, because the banks have independently raised the rates on investor and interest-only borrowers. So the RBA can stand back and say the heat in the property market is being dealt with, so economy-wide interest rates don't have to rise.

"But that means investors haven't seen the benefit of a cash rate increase. And until inflation picks up, it's hard to see that changing."

At between 1.62 per cent per annum for 30-day term deposits and 2.73 for five years, most term deposits cluster around the cash rate, which was 2.1 per cent over the previous year in March. The RBA's 1.5 per cent cash rate is below inflation, in effect negative in real terms.

To bump up their deposit rates, savers need to work hard, Mr Mickenbecker said.

'Work harder with your savings'

Most banks offer introductory, higher rates on term deposits, which savers can use to make returns above 3 per cent, he said. "But once that rate disappears, you have to move to another institution.

"Another way is with bonus savings accounts – which have all sorts of conditions and a lack of flexibility, which can offer higher rates.

"But with all the ways, you have to work harder with your savings. And I suspect people are not doing so – because the big four banks haven't had to pay rates as high as those of the second-tier players."

With ratings agencies having downgraded Australian financial institutions recently, their wholesale funding costs will rise in coming years. It's possible this may see them trying to encourage domestic saving instead, by bidding up rates. But dramatic shifts are unlikely unless the RBA raises interest rates, Mr Mickenbecker said.

"Until inflation picks up and the RBA feels the obligation to move rates up to deal with that, I think we'll see relatively low interest rates. It all relies on stronger economic conditions."