The New Zealand government is making moves to revamp its payment infrastructure by introducing a system that tracks payments in real time.
The government has tasked the Reserve Bank of New Zealand (RBNZ) to oversee the initiative. The move has the potential to be the most transformative initiative the country has taken up in decades.
It could also mark a significant turning point for banks, financial technology (fintech) firms, small and large-scale businesses, and even individuals who send and receive money on a daily basis.
Read on as we explore the government’s long-term plan and what it means for the payments sector in New Zealand.
Real-Time Payments Make Life Easier
While New Zealand’s payment systems have been strong and reliable over the years, they are also old-fashioned compared to other countries.
Traditional bank transfers are slow and unbearable for many customers. These transactions can take hours and sometimes even days to go through.
The systems that banks use were designed decades ago, in an era when payments weren’t instant and everything moved at a more manual pace.
Digital commerce has now taken over the market. People can shop online, and businesses can move money around faster, leaving customers restless when they cannot make instant transactions.
Because of these changes, older payment systems can no longer cater to the needs of the average modern-day customer, and the cracks are becoming impossible to overlook.
Looking to make life easier for its citizens, the government announced that the RBNZ will oversee the transition to a modern payment infrastructure.
They realise that the changing customer needs have made it difficult for the private sector to handle the massive increase in demand without back-up.
This is not the first time the government has tried to modernise its payment system. They have previously tried implementing the Next Generation Payments (NGP) initiative from Payments NZ.
While it sparked useful conversations about how to move forward, there was no clear plan to prioritise real-time payments. They were more focused on making payment security impenetrable, improving customer experience, and encouraging the sector to embrace new technologies.
Payments NZ’s plan drew mixed reactions from the industry. There were those who supported the work they put in for the benefit of society.
However, the commercial benefits were not clear enough for the banks expected to fund the initiative, so the entire plan fell apart, even as consumers and businesses were frustrated by the outdated systems.
How Real-Time Payments Could Impact the Betting Sector
Real-time payments can be applied to every industry that deals with sending and receiving money, including the betting sector.
Kiwis who love to indulge in their pastime on the online gambling platforms featured on Bettingtop10.co.nz expect transactions to be fast and seamless.
That includes funding their betting accounts or making a withdrawal, and the demand for friction-free payment systems has increased since mobile betting became popular in New Zealand.
Real-time payments have the potential to transform the betting experience across the country.
Kiwi bettors want to be able to place wagers as soon as they fund their accounts, and real-time payments ensure they do not have to suffer unnecessary delays.
Being able to access and withdraw winnings with a minimum of fuss is just as important to bettors. In most cases, it determines whether or not they continue to use a betting platform.
For many players, fast access to their winnings helps build trust, which gives operators who offer immediate payouts the edge in a highly competitive market.
Why Real-Time Payments Matter More Than Ever
By integrating real-time payments into the financial sector, customers will be able to clear funds within seconds. It also removes the uncertainty that comes with unnecessary delays.
While customers and businesses have plenty to gain from the incorporation of real-time payments, banks also stand to benefit from streamlined operations.
New Zealand banks usually process transactions in batches, but real-time payments will bring an end to a system that has shaped the sector for decades.
They will need better infrastructure to pull it off, but it will be worth it in the long run. It will reduce operational costs and make them more compliant with the authorities.
Incorporating real-time payments could also help New Zealand rub shoulders with some of the global powerhouses, including the United States.
The US has not had a stable or consistent plan for open banking for several reasons. Without a clear roadmap, the country’s open banking system has been stagnant and unpredictable.
Unlike New Zealand, where the government is starting to set clear rules, the US is hardly making concrete moves to sort out its open banking system.
The closest the US has come to a stable system was in 2024, when the Consumer Financial Protection Bureau (CFPB) issued an open banking rule requiring banks to share specific types of customer data.
It briefly seemed like the US would fix the broken system, but political change put a pause on the initiative before ultimately leading to rescission.
