If a person has $50,000 in their offset account and a $750,000 loan, they will only be charged interest on $700,000.Sally Tindall, director of data insights at Canstar, said offset accounts are a popular choice for many Australian mortgage holders."For many customers, it's one of the most powerful tools borrowers have to reduce the amount of interest they pay on their mortgage — but only if it's working as intended." However, offset accounts are often associated with higher interest rates, additional account fees or a combination of both.ASIC encouraged Australians to check whether their offset account was actually set up following their initial request In just over a month, a customer paid more than $3,500 in additional interest because their offset account was not linked, ASIC found.Tindall said: "When you've spent years building up savings in your offset, the last thing you want is for those dollars to be sitting in an account that's not actually reducing your interest bill.""But don't stop there, do some quick maths to make sure the interest you're being charged is on the amount you actually owe, factoring in the offset balance."Customers with complaints or questions should contact their bank directly