On 31 March 2025 the Reserve Bank of New Zealand (RBNZ) announced its board had approved revised access criteria for its Exchange Settlement Account System (ESAS), that will open ESAS eligibility to more non-bank entities. These changes follow two consultations last year in relation to expanding the criteria for which entities can access ESAS. For further information on these consultations please see our previous article RBNZ proposes criteria for increased ESAS access.
The new criteria will open access to ESAS accounts in two phases (prior to this ESAS accounts were only available to registered banks and certain government organisations):
- First, to licensed non-bank deposit takers in New Zealand; and
- Second, to other entities that meet the access criteria. The RBNZ expects this to include payment service providers, overseas deposit takers and operators of designated Financial Market Infrastructure.
There is limited information or guidance about what entities will fit within phase two as the revised access criteria are yet to be published, but the RBNZ expects this to occur in the coming weeks. It additionally remains to be seen what information will need to be provided in the application process to satisfy RBNZ that the applicant meets the new criteria and does not pose a threat to the operational capacity of ESAS.
Increased access to ESAS represents a significant opportunity for non-bank financial institutions both in terms of managing liquidity and developing innovative payments products and services.
Depositor Compensation Scheme provisions commence
Also of interest to deposit takers (including non-bank deposit takers and registered banks), various provisions of the Deposit Takers Act 2023 (DTA) relating to the Depositor Compensation Scheme (DCS) have commenced today, 1 April 2025, in accordance with the Deposit Takers Act Commencement Order 2025.
The DCS provides certain protections for depositors and will fully come into force from 1 July 2025. In preparation for this, provisions of the DTA have now commenced that relate to RBNZ information gathering powers, updates to the functions of the RBNZ and allowing for certain standards (including depositor compensation and information disclosure) to apply during the transitional period until the DTA comes fully into force.
The substantive sections of the DTA relating to the DCS will come into force on 1 July 2025, and we will provide a further update on this closer to that time. For further information on the DTA, including the DCS, please see our previous article Changes to the regulation of deposit takers in New Zealand.
If you would like to discuss or remain informed on developments relating to ESAS access or the DTA/DCS, please get in touch with our financial services regulation team.
This article was prepared by Andrew Suggate (senior associate) and Thomas Carr (solicitor)
