The Reserve Bank of New Zealand is currently assessing just one full banking registration application, leaving the push for fresh competition in the sector moving at a crawl more than a year after a major parliamentary inquiry.
Two non-bank deposit taker licence bids are also under review. A newly approved NBDT is expected to be named soon. Yet the $30 million regulatory capital floor and the long runway to the Deposit Takers Act still shape who can even try.
The Single File Still Under Review
An RBNZ spokesperson confirmed the regulator is considering one full banking registration application under the Banking (Prudential Supervision) Act 1989. Two further applications seek NBDT licences under the Non-bank Deposit Takers Act 2013.
“For commercial reasons, we do not release the names of entities engaged in the application process. Once an entity becomes licensed/registered, we publish their name on the relevant register on our website,” the spokesperson said.
British-headquartered fintech Revolut has been working through the process since submitting in December 2024. After securing an Australian banking licence and a full UK banking licence earlier, Revolut’s New Zealand head Georgia Grange said the focus “remains firmly” on progressing the local application. “Securing a New Zealand banking licence remains an important part of our long-term strategy and commitment to the market,” she stated.
- One active full banking registration application
- Two NBDT licence applications under review
- One recent NBDT approval (name to be published)
- 27 registered banks and 14 licensed NBDTs at present
Interest.co.nz understands the newly approved NBDT belongs to Oxbury, a UK agricultural lender establishing a New Zealand subsidiary. Registering as a bank lets an institution take retail and wholesale deposits, lend, and use banking language. An NBDT can offer similar services but cannot call itself a bank under current rules.
That split in rights matters for brand and for customer trust. The single full-bank file and the pair of NBDT bids therefore sit on different tracks even though both aim at deposit-taking. Until the DTA removes the branding gap, the tracks stay separate.
The Capital Floor That Still Binds Applicants
Any entity seeking full banking registration today must still clear an absolute minimum of $30 million of regulatory capital. That capital sits first in line to absorb losses. Application fees run $21,000 for a New Zealand-registered bank or overseas branch or subsidiary, and $36,000 for other applicants.
Parliament’s Finance and Expenditure Committee urged the RBNZ in August 2025 to halt further capital increases, arguing they raised borrowing costs and suppressed competition. The same month the RBNZ proposed, and later confirmed, plans to reduce the minimum capital requirement for deposit takers from $30 million to $5 million, timed for 2028 under the new regime.
| Requirement | Current (pre-DTA) | From late 2028 (DTA) |
|---|---|---|
| Minimum regulatory capital | $30 million | $5 million |
| Application fee (NZ bank / overseas branch) | $21,000 | Under new DTA licensing |
| Application fee (other) | $36,000 | Under new DTA licensing |
| Use of “bank” word by NBDTs | Prohibited | Permitted once licensed |
An RBNZ spokesperson confirmed the $5 million figure remains scheduled for 2028. Any entity that applies for a full banking licence under the existing Act before that date must still meet the $30 million bar. The regulator has not paused processing. “We will continue processing applications under the current regime until that time,” the spokesperson said. Applications for licences under the Deposit Takers Act open from 1 June 2027, with priority for existing regulated banks and NBDTs.
The sixfold drop in the capital minimum is the clearest single change on the timetable. Until it lands, the fee schedule and the $30 million floor continue to filter who can afford to try.
How the Deposit Takers Act Creates the Holding Pattern
The Deposit Takers Act 2023 will place banks, building societies, credit unions and finance companies under a single prudential regime. Full effect arrives on 1 December 2028. All entities licensed under today’s rules must be relicensed by then.
- June 2027, Applications for new licences under the DTA open; relicensing of existing banks and NBDTs begins, with staggered due dates through 2028.
- 31 May 2027, Most DTA standards (capital, liquidity, governance, operational resilience and others) are scheduled to be issued.
- 1 December 2028, DTA fully in force; new capital settings including the $5 million minimum apply; restricted words open to all licensed deposit takers.
Final decisions on key capital settings from the 2025 review were announced in December 2025. They lower Tier 1 requirements for larger groups relative to the earlier 2019 path and remove Additional Tier 1 instruments, while introducing loss-absorbing capacity for the biggest players. The practical effect for new entrants is simple: the cheaper entry ticket and unified rules arrive together at the end of a long calendar.
Priority for existing regulated banks and NBDTs when DTA applications open in June 2027 further tilts the early queue toward incumbents. New names can still apply, yet the staged order means the first wave of relicensing will absorb supervisory capacity before fresh faces clear the gate.
Fintechs That Hit the Wall or Chose to Wait
The RBNZ declined one banking registration application over the past five years. That rejection went to New Zealand fintech Dosh. The regulator did not view Dosh’s proposed model as viable under current legislation. Co-founder Shane Marsh said the firm is weighing “the best way forward” and remains undecided on another bid. Waiting for the 2028 framework and the lower capital threshold is one option under discussion.
Emerge, another local fintech with clear bank ambitions, has not submitted a formal application. Co-founder Jovan Pavlicevic said the firm has held ongoing discussions with regulators and policymakers about available pathways.
- Revolut, application lodged December 2024, still under assessment; Australian and full UK licences already secured
- Dosh, registration declined; reviewing options including a possible wait for 2028 rules
- Emerge, no formal application yet; in discussions on pathways
- Oxbury, UK agricultural lender; NBDT licence recently approved for NZ subsidiary
On X, Revolut supporters have urged a faster NZ outcome after the Australian licence. The company’s own support channel has told customers there is “no confirmed timeframe” for the New Zealand banking licence and that updates will come through official channels. One investor analysis noted that regulators in several markets, including New Zealand, effectively waited for the full UK licence before advancing their own processes. That sequencing leaves New Zealand further down the queue even as Revolut builds local revenue and staff.
The pattern across the four names is consistent. One is inside the full-bank process, one was turned away, one is still talking, and one has taken the NBDT route. None has yet broken the oligopoly the Commerce Commission described.
Who Benefits While the Queue Stays Short
New Zealand still has 27 banks currently registered with the RBNZ. The four largest, ANZ, ASB, BNZ and Westpac, continue to dominate personal banking. The Commerce Commission’s market study into personal banking services concluded the sector operates as a stable oligopoly with no maverick provider. High profitability and limited innovation were flagged as symptoms.
The parliamentary inquiry that followed reached similar conclusions, highlighting weaker rivalry and the drag of capital rules on rural borrowers and smaller lenders. In the meantime, everyday pricing decisions such as mortgage test rates held after the OCR hike remain the preserve of the incumbents. A separate central bank push to keep cash services local shows how regulation continues to shape the physical footprint of the existing network while new digital challengers wait for clearer entry terms.
Entities that can fund $30 million of capital and navigate a multi-year process can still apply today. Most potential disruptors appear to be calculating that the cheaper, clearer DTA path is worth the wait. The result is that political pressure for more competition has so far produced almost no change in the number of full banks.
Why the Two Licence Paths Still Diverge
Full banking registration and an NBDT licence open different doors under the rules that still apply. The gap is not only about capital. It is about what each licence lets an entity say and do in the market.
| Feature | Full bank registration | NBDT licence |
|---|---|---|
| Retail and wholesale deposits | Yes | Yes |
| Lending | Yes | Yes |
| Use of the word “bank” | Allowed | Prohibited until DTA |
| Minimum regulatory capital today | $30 million | Lower NBDT settings |
| Current active applications | One | Two |
Oxbury’s recent NBDT approval shows the lighter path is open and being used. Revolut’s choice to pursue full registration shows the heavier path still attracts applicants with deeper capital and multi-market licences already in hand. Dosh’s declined bid and Emerge’s decision to stay in discussion rather than file both underline how few local fintechs are willing to clear the $30 million bar before 2028.
Once the DTA is fully in force, the branding distinction disappears for every licensed deposit taker. Until then the two tracks keep producing different competitive signals even when the underlying products look alike.
When Every Deposit Taker Can Say Bank
One concrete change is already locked in. In June 2026 the RBNZ announced that from 1 December 2028 all deposit takers will be able to call themselves banks once licensed under the DTA. Building societies, credit unions and finance companies that clear the new standards will gain the branding rights now reserved for registered banks.
We are satisfied that the DTA provides the necessary safeguards to extend the use of restricted words to all licensed deposit takers. This change supports improvements in the competitive landscape and a consistent approach across deposit takers.
Acting Assistant Governor Financial Stability Angus McGregor made that statement when the decision was released. The move removes a long-standing marketing handicap for NBDTs. It does not, by itself, create new capital or new competitors. It does mean that by the end of 2028 the public face of deposit-taking could look more crowded even if the number of entirely new full-licence banks remains modest.
For customers the change will be visible on branch signs, apps and advertising. For the 14 licensed NBDTs already on the register, and for any that join before the deadline, the right to use the word becomes a standard feature of the licence rather than a separate privilege.
What the Long Pause Means for Rivalry
The Commerce Commission found a stable oligopoly with no maverick provider. The parliamentary inquiry echoed that finding and tied weaker rivalry in part to capital rules. Those conclusions still describe the market while the application count stays at one full-bank file and two NBDT bids.
- Four large banks dominate personal banking pricing and product design
- Twenty-seven registered banks and fourteen licensed NBDTs form the full current field
- One declined full-bank bid in five years shows how rarely the gate opens
- Mortgage test rates and cash-access rules continue to be set inside the existing network
Lower capital, unified standards and open use of the word “bank” are all timed for the same date. The reform package therefore answers the competition critique and, at the same time, freezes the entry terms that produced the critique until late 2028. Rural borrowers and smaller lenders flagged by the inquiry remain under the current capital settings for the intervening years.
The Calendar Still Runs Longer Than the Rhetoric
The RBNZ has made clear it will keep processing applications under the old Acts until the DTA window opens. It declined one bid in five years and keeps applicant names confidential until success. Over the last decade it has not published historical application and approval tallies.
For now the arithmetic is straightforward. One active full banking application sits on the desk. The capital ticket stays at $30 million for anyone who wants in before the new regime. Lower barriers, unified standards and free use of the word “bank” all arrive together on 1 December 2028. Until then the existing register of 27 banks and the four-player core of the personal market continue to set the terms.
That is the irony built into the reform timetable: the measures sold as answers to the competition problem also write a multi-year pause into the system that keeps the pause in place.
