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A quick guide to banking in New Zealand

Banking in New Zealand

Moving countries and moving banks is always a big step. While the New Zealand banking system is one of the safest and most stable in the world, there may be a few differences from the banking system in the country you are moving from.

To help make things a little easier, here is a quick summary of how banking works in New Zealand.

Currency

  • New Zealand Dollar (NZD) - there are 100 cents in 1 dollar, also written as $1.
  • New Zealand dollar notes come in denominations of $5, $10, $20, $50 and $100.
  • New Zealand coins come in denominations of 10c, 20c, 50c, $1 and $2.
  • If you are paying for something in cash, prices are rounded up or down to the nearest 10c. For example, you would pay $2.90 if the total comes to $2.94, but $3 for a total spend of $2.97.

Ways to bank

In New Zealand, many individuals use internet and mobile banking to manage their money when and where it works best for them. At ASB, we have a number of options that enable you to access your money 24 hours a day, 7 days a week.

Different banks and branches have different opening hours, and at times you may want to visit in person. You can find ASB branch opening times here or book an appointment using the ASB Mobile Banking app.

Opening your New Zealand bank account

Opening a bank account might seem overwhelming but it's our goal to make it as easy for you as possible. We take care of the switch and will work with your current bank to arrange a smooth transition.

You can join ASB online or by making an appointment at your nearest ASB branch.

New Zealand's anti-money laundering laws require us to verify every customer's identity. This means you'll need to provide some documents to verify your identity and address before you begin using your account. Here's a full list of accepted documents.

If you need help with providing this documentation, get in touch with our team.

Paying and receiving money from overseas

International Money Transfers are a secure electronic transfer of money between accounts held with different banks around the world. It usually takes 1-3 business days to process an International Money Transfer, but it may take longer depending on the country and banks that the money is being transferred between.

Here are the details you’ll need to electronically transfer money from overseas to your ASB account.

At ASB we do not accept or sell foreign currency cheques, also known as a foreign draft or bank draft.

We no longer use cheques in New Zealand for making payments in New Zealand dollars (NZD).

Paying for things in New Zealand

Carrying large amounts of cash is less common in New Zealand. Most retailers offer EFTPOS terminals for customers to pay for goods or services using an EFTPOS card, debit card or credit card. EFTPOS terminals are widely available throughout New Zealand wherever you’re likely to spend money e.g. supermarkets or petrol stations.

When you pay at an EFTPOS terminal, the terminal machine will ask which account you want to use - cheque, savings or credit. In some cases, you may be able to pay from different accounts using the same card depending on the button you select.

Some EFTPOS terminals offer contactless technology that enables you to pay by debit card, credit card or compatible mobile phone. Retailers may charge additional fees when using a credit card and/or contactless payment option.

Payments are processed seven days a week in New Zealand, meaning that payments made on weekends and public holidays will be processed the same day. This includes direct debits, automatic payments and transfers to other banks but excludes large payments like house settlements, and international payments, which will be processed on business days.

When cash is required, there's usually an ATM (Automatic Teller Machine) nearby. Major New Zealand banks do not charge a fee for using an ATM belonging to other major New Zealand Banks.

Interest

In New Zealand we use interest as compensation for both borrowing money and for savings and investment products. Interest is paid by the person in possession of the money to the owner of the money. The amount of interest paid is determined by:

  • The length of time the money is invested or borrowed; and
  • The interest rate, which is an annual percentage (also referred to as per annum or p.a.) applied to the amount.

There are two main types of interest, simple and compounding.

  • Simple interest is when the interest rate is applied to the original amount. For example,
    • Lending: If you borrow $100 from a bank for one year at a 5% interest rate, then you would pay the bank $5 total in interest for the use of the $100 you borrowed for the year.
    • Saving or investing: If you put $100 into a bank savings account with a 5% interest rate for one year, the bank will pay you $5 total in interest as compensation for the privilege of looking after your money for the year.
  • Compounding interest is when the interest rate is applied to both the original amount and the interest to date. You can find out more about compounding interest on sorted.org.nz.

Interest rates are influenced by the risk of the borrowing and can change over time. Home lending (also known as a mortgage) and savings accounts usually have lower interest rates than credit cards and car loans which are considered riskier.

Security and scams

Although one of the safest countries in the world, like many countries, New Zealand is not immune to people carrying out fraudulent activity including online and telephone scams. You can find more information about staying safe online here and we have guides in Easy English and additional languages here.

New Zealand banking terms

View the banking and finance terms used in New Zealand:

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The Code of Banking Practice

New Zealand has a number of laws to help protect consumers. In addition, we have signed up to The Code of Banking Practice that sets out principles of good banking practice.