Payments every day arrives in Aotearoa New Zealand
22 May 2023
From Friday 26 May, electronic bank payments made on public holidays and weekends can now go through on the same day, every single day of the year.
365-day payments or seven-day payments processing, a significant industry change project led by Payments NZ, will now be the norm for ANZ, ASB, Bank of China, BNZ, Citi, HSBC, ICBC, Kiwibank, TSB and Westpac – these banks collectively offer financial services to the majority of consumers in Aotearoa New Zealand.
Payments NZ Chief Executive Steve Wiggins says the change is the next step in modernising the country’s payments system, allowing for both consumers and businesses to pay and be paid any day of the year – including weekends and public holidays.
“We’re excited to see the next evolution of payments in Aotearoa, which is the end of the traditional ‘five business days’ model for electronic bank payments,” says Wiggins.
“Previously, banks could only send and settle payment transactions on business days. But from this weekend, consumers and businesses will be able to transact every day of the year and no longer need to wait for a traditional business day.”
The move to 365-day payments will impact direct credit transactions, direct debits, automatic payments, and bill payments.
“For New Zealanders, things like buying or selling through platforms like TradeMe could be easier as electronic payments made between participating banks will now go through on the same day,” says Wiggins.
“We could also see improved cashflow for small-to-medium businesses over weekends and public holidays. In a highly connected, always-on world, we know people will appreciate the option to be able to pay or get paid any day of the year – and now they can.
“This has involved a huge effort from the industry including the Reserve Bank of New Zealand Te Pūtea Matea. The payments system that supports this change transacts over $1.5 trillion of payments annually.
“In order to innovate their processes and enable this major change for payments in Aotearoa, Payments NZ, the banks and the Reserve Bank introduced significant changes into the existing payments system while still maintaining its security and integrity.
“365-day payments are only one component of the payments ecosystem of the future. We’re leading several other projects, such as open banking and ongoing investigations into next-generation payments capabilities, which will make Aotearoa’s payments system truly world-class.”
The change will primarily affect retail payments. High value transactions, such as house settlements, will continue to operate under the existing ‘five business days’ model and will not be impacted by this change.
Preparing for change
As organisations and businesses start shifting to 365-day payments, it’s more important than ever for consumers in Aotearoa to understand how this change could impact them personally.
“The main thing we want New Zealanders to know is that from Friday 26 May, electronic bank payments like automatic payments and direct debit payments may come out on their actual due date, which could be a weekend or public holiday. So, please plan for this change,” says Wiggins.
“It’s important for consumers to check the automatic payments they have set up themselves to see if there will be any impact on due dates.
“Check their direct debits too. These are regular bank payments set up and controlled by businesses like utility providers or the gym, so if they need to make any changes, discuss them with the businesses who helped set up those direct debit payments.
“Our participating banks have been contacting customers recently about how these changes will impact them. If anyone hasn’t received any information from their bank or would like more, it’s recommended they visit their bank’s website,” says Wiggins.
For more information about this initiative, see our Q&As.