We were pleased that our industry work was able to continue during the COVID-19 lockdown, and we were able to keep up the momentum by moving this work online. That has meant as we head into the second half of 2020, good progress has been made across our work programme. Find out more below.

Payments Direction

Toward the end of last year, we facilitated an industry working group to consider a range of new and existing opportunities and challenges the payments industry may face over the coming years.  We did this to check-in on the current direction of the programme following a significant period focused on establishing the API Centre.

The working group discussions led to a need for us to dedicate time to considering current payment system capabilities, potential gaps, and desired future capabilities. Importantly, the group wanted to better understand how both the newly identified and existing opportunities could fit together in the context of an overarching payments ecosystem roadmap and payments modernisation plan.

We’ve been working with the industry group to develop that overarching roadmap since early this year and we were pleased to be able to continue this work remotely during lockdown.

We will shortly begin engaging with a wider range of stakeholders to share the work that has been done to date, and to get further input on the work done so far. Alongside this, we’ll also be looking to finalise the roadmap and our 2021-22 work plan for the programme.

Management Committees

We’ve made significant progress with our core clearing systems work over recent months. The Bulk Electronic Clearing System (BECS) Management Committee has signed off on the business requirements and agreed on the rules and procedures for SBI365. This is an ongoing significant project that would enable Kiwis to make and receive electronic payments between accounts at different banks every day of the year. Participants are now finalising some details around the timeframes for implementation.

Meanwhile, our High Value Clearing System (HVCS) team has been working with SWIFT and the Reserve Bank of New Zealand (RBNZ) on how we transition our current HVCS payment message types to ISO20022. Once this initial work has been completed, we’ll start engaging with Participants for the next phase.

We’re also supporting the RBNZ’s Payment System Replacement (PSR) project, which launched in February, by making required amendments to our rules and procedures. These changes reflect the new ESAS 2.0 system Participants will be operating in.

API Centre

It’s been a big year for the API Centre with the publication of version 2.0 of our API standards for Payment Initiation and Account Information. This was a significant milestone for the centre and a positive step towards our shared vision of seeing new and enhanced payments-related innovations for Kiwis.

After having received a lot of interest in our standards from across the ecosystem, and to encourage further diverse involvement and participation with the API Centre, we also recently waived the annual fee for being a Community Contributor for the first 12 months. One of the key benefits of being a Community Contributor is the opportunity to get in and use our sandbox, which is powered by Middleware NZ, to test innovations against our standards in a secure test environment. V2.0 of our API standards are now also available in the sandbox, alongside v.1.0.

As we look to the future, we’re currently in a consultation phase with Standards Users and our wider API-enabled ecosystem to get their feedback on future priority areas the centre should be focusing on. This feedback will be used to help inform the development of the rest of our work programme for the 2020/2021 financial year.

Regulatory radar

Our Chief Executive, Steve Wiggins, presented Payments NZ’s submission on the Financial Market Infrastructures (FMI) Bill before Parliament’s Finance and Expenditure Select Committee in early May. Payments NZ governs two of the payment clearing systems – Settlement before Interchange (SBI) and the High Value Clearing System (HVCS), that are likely to be proposed for designation as financial market infrastructures under this law.  

Our submission focused on three key areas we asked the committee to consider when determining the final content of the Bill. The Select Committee is to report back to the House on their progress with the Bill on 12 August.

Making connections

We were pleased to be able to keep connecting with our stakeholders and the industry during lockdown by moving meetings online. Now that we’re at Alert Level 1, we’ve been able to resume in-person external meetings, while ensuring we continue to follow good health and safety protocols.

Notably, we’ve now returned to quarterly in-person meetings with the Reserve Bank of New Zealand following a period of weekly online updates during the lockdown. Representatives from the Reserve Bank were also able to join our June Board meeting.

Earlier this year we signed a memorandum of understanding with the Emerging Payments Association Asia. The association is heading up industry discussions with the APEC Business Advisory Council (ABAC) and APEC Financial Forum (APFF) to understand the opportunities for open banking and API standardisation across the Asia-Pacific region. Both our General Manager Strategy, Jane Retimana and Chief Executive, Steve Wiggins, joined the ABAC/APFF panels to share insights on New Zealand’s own API standards journey.  

Steve also attended an engagement session with The Digital Council for Aotearoa New Zealand, which looked at getting input from a wide range of representatives from across the financial sector into digital and data-driven issues and opportunities facing New Zealand.

We’ve also been busy planning out how we can continue to deliver industry events safely and effectively for the rest of the year. Over the past few months, we had been re-assessing whether it was still possible to go ahead with our conference, The Point 2020, in November in light of COVID-19.

Although we’re now at Alert Level 1, cases of COVID-19 are continuing to rise globally and unfortunately the impact of the pandemic on New Zealand in the coming months is still unknown. Given the uncertainty over whether we’d be able to deliver a full conference experience this year, we made the decision to cancel the conference.

We are, however, now working on an online event series that we can bring to the industry earlier than November. The programme will focus on the impact of COVID-19 on the payments industry, and the challenges and opportunities in New Zealand as we begin to look at economic recovery.  We also hope to include in-person networking opportunities, should it remain possible and safe for us to do so.

We’re aiming to bring the industry this new event in the coming months and look forward to sharing the details once finalised. If you know someone who might be interested in receiving updates about this event, make sure they sign up to our mailing list.