Commonwealth Bank of Australia (ASX: CBA) shares have been a great option for passive income over the years, but I think there are plenty of better ASX dividend share options today.
CBA faces a more difficult operating environment these days following the Federal budget changes.
It's possible the ASX bank share may not see as much loan demand for the foreseeable future, following changes to negative gearing and capital gains tax (CGT) discounts announced in the most recent Federal Budget.
CBA's annual dividend per share is only expected to increase by 1% year-over-year in FY27 to $5.15 per share. That translates to a grossed-up dividend yield of 4.4%, including franking credits.
In my view, the following two businesses are better picks for passive income.
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Medibank Private Ltd (ASX: MPL)
Medibank is the largest private health insurer in Australia, with its main brands of Medibank and ahm.
Private health insurance is an industry with useful tailwinds, including ageing demographics and a rising population. This helps support Medibank's policyholder numbers and underlying net profit, which are key drivers of the dividend.
The FY26 half-year result was a great example of its ability to pay attractive and growing dividends.
In HY26, the business revealed that revenue grew 5.5%, segment operating profit grew 5.9%, and group operating profit increased 6%. This helped the business fund a 6.4% increase of the interim dividend per share to 8.3 cents.
The ASX dividend share's expansion into other areas of healthcare can also help grow and diversify its earnings, giving further support for the dividend. Medibank Health segment profit increased by 28.5%, which includes community and acute healthcare. One recent initiative included increased ownership of Amplar Health Home Hospital.
According to the projection on Commsec, the business is forecast to pay an annual dividend per share of 22 cents in FY27. That translates into a potential grossed-up dividend yield of 6.2%, including franking credits, at the time of writing. That's a noticeably better yield than what CBA shares offer.
Dexus Industria REIT (ASX: DXI)
Dexus has a very large exposure to Australia's real estate market, so why not just invest in a compelling passive income option from the real estate space?
Dexus Industria is a real estate investment trust (REIT) that is invested in high-quality industrial warehouses. Its real estate portfolio is located across major Australian cities, with a goal to provide securityholders with sustainable income and capital growth.
There is strong demand for industrial properties as a result of growing e-commerce usage, data centres and so on. This is helping drive pleasing rental growth for the business. In the first six months of FY26, the ASX dividend share saw like-for-like income growth of 7.4%, with rental escalations, strong re-leasing spreads and higher average occupancy.
The business is paying an annual distribution per security of 16.6 cents in FY26, translating into a distribution yield of 6.8%, which is much stronger than what's on offer from CBA shares.
