On 7 April 2025, the Reserve Bank of New Zealand (RBNZ) released its access criteria for its Exchange Settlement Account System (ESAS). It also confirmed the application process was officially open to non-bank deposit takers (NBDTs). Applications for non-bank financial institutions are expected to open later in the year.

The announcement builds on recent RBNZ press releases, which stated that ESAS access would be expanded to non-bank financial institutions, including NBDTs and payment service providers (PSPs). You can read more about those previous releases, and the rationale for expanding ESAS access to non-bank financial institutions, here. 

Who needs to read it? Why?

NBDTs and PSPs that want to apply for an ESAS Account should take the time to read RBNZ’s refreshed ESAS criteria and application process. Access to ESAS allows for new commercial opportunities by improving operational capabilities and allowing for different or improved offerings. NBDTs can begin the application process now by submitting an expression of interest with the RBNZ.

PSPs that wish to make an application should familiarise themselves with the access criteria now. Although RBNZ has stated it will only be accepting applications from NBDTs and registered banks for the time being, it has indicated it intends to open up applications to other entities in the third quarter of 2025. PSPs can start positioning themselves to make an application now, including commencing their applications with Payments NZ to join a relevant clearing system. 

We also note that the press release explicitly states that all successful applicants will be eligible to receive the overnight deposit rate on their balances, putting an end to concerns that accounts held by some non-bank financial institutions would not be eligible.

Overseas deposit takers, and operators of designated financial market infrastructures, each of which are mentioned in the refreshed criteria, may similarly like to position themselves for making an application later in the year. 

This expanded access to ESAS is expected to introduce new opportunities, risks, and competition for non-bank financial institutions and registered banks alike. However, the fee structure and operational requirements will need to be considered by potential applicants when assessing these opportunities.

What does it cover?

In summary, the updated ESAS access criteria states that, to access ESAS, an applicant must satisfy business activity criteria, AML compliance criteria, prudential and governance criteria and operational criteria. An applicant will satisfy the business activity criteria and the prudential and governance criteria if, amongst other things, the applicant is a licensed deposit taker. Therefore, for NBDTs looking to apply for ESAS access, those two criteria will be satisfied immediately. PSPs on the other will need to evidence their satisfaction of this criteria. 

We note that the final access criteria has removed the “net benefit to New Zealand” business activity criteria for PSPs. PSPs will need to be a participant in a clearing system that settles in ESAS or have made an application to be a participant to meet the business activity criteria. PSPs will also be required to evidence appropriate management of prudential and governance matters.

The AML compliance criteria requires that an applicant be a reporting entity for the purposes of the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (AML/CFT Act), and that the applicant provides the RBNZ with “a compliance history demonstrating the applicant’s compliance, risk management, and overall prudence in countering financial crime under the AML/CFT Act”.  

The access criteria sets out operational criteria at a high-level, but NBDTs and PSPs a like will need to work closely with the Reserve Bank to determine what is required of them operationally to integrate with ESAS.

What next?

RBNZ is inviting applications from NBDTs interested in accessing ESAS. NBDTs interested in applying for an ESAS account should contact us for more information on the application process and the process for demonstrating compliance with all criteria.

PSPs that are interested in applying later in the year should start considering what steps they need to take to prepare for making an application. 

If you have any questions in relation to the development of ESAS access or are considering how these changes may affect your business, please contact one of our experts.