The Reserve Bank of New Zealand – Te Pūtea Matua (RBNZ) has released an Issues Paper titled Modernising New Zealand's Retail Payment System, in which the RBNZ identifies key issues with New Zealand's retail payment system and makes the case for adapting it for today's digital world and modern global standards.

The RBNZ is seeking feedback from industry stakeholders on the Issues Paper by 27 October 2026.

The RBNZ's analysis of current issues

The Issues Paper begins with an introductory section setting out an overview of the payments system, key terms, previous stakeholder engagements and timing requirements.  The RBNZ then analyses the current state of New Zealand's retail payment system, in two parts.

Part 1: System performance and capability gaps

The RBNZ identifies certain key issues with system performance and capability gaps, including:

  • Reliance on legacy systems restricting competition and innovation, leaving New Zealand without features that are standard in payment systems worldwide

  • Limited innovation and competition leaving users without modern features, such as rich data or modern point-of-interaction methods like QFC or NFC 'tap and go' payments

  • Limited development of modern systemic fraud and scam features

  • A need to improve cross-border payment capability and improved payments capability to support emerging payment technologies

  • The need to improve payments systems to support resilience and economic sovereignty.

Part 2: Strategic leadership gap, fragmentation and misaligned incentives

In Part 2 the RBNZ identifies structural governance challenges that have allowed the capability gaps described in Part 1 to persist.  New Zealand currently lacks a single authority (or coordinated group of authorities) with a clear mandate to provide system-wide strategic leadership.  The RBNZ considers this gap is compounded by a fragmented regulatory landscape: payments regulation is currently spread across seven pieces of legislation, spanning prudential soundness, market conduct, competition, infrastructure oversight, anti-money laundering and data-sharing, with no overarching system-level description of roles and responsibilities.  The RBNZ's view is this results in misaligned incentives and an environment that is difficult to navigate for both incumbents and new entrants.

What is the RBNZ proposing?

The Issues Paper sets out a vision for New Zealand's payment system, to be reliable, efficient and aligned with the evolving needs of New Zealand consumers and businesses.  To achieve this vision, the RBNZ sets out three core principles for reform:

  • Effective strategic leadership with a clear mandate

  • A coherent and navigable regulatory framework

  • Governance arrangements that reflect broader public interest objectives.

The paper presents a spectrum of options across legal/governance and platform dimensions, drawing on comparable jurisdictions including Australia, the UK, Singapore and Sweden, with governance reform identified as the minimum necessary first step.

If you would like to discuss the Issues Paper or any aspect of New Zealand's payments regulatory framework, please get in touch with our financial services regulation team.

This article was prepared by Andrew Suggate (partner) and Lily Rose Hosseini (law clerk).