Payment Systems

Home Expertise Payment Systems

The full spectrum of payments advice

Our payment systems team offers a comprehensive service, consisting of experts across a number of disciplines, including banking and finance, technology, privacy, competition/antitrust, consumer law, economic regulation and law reform.  

We understand the practical operations of payment systems and how these fit within the New Zealand regulatory landscape. Our work spans the full spectrum of payments advice, including in relation to payment service and software providers, payment switches and payment gateways, and arrangements for sponsor banks and merchant acquirers and electronic transactions. We are also at the forefront of developments in this area, advising on New Zealand's move towards open banking and technological advances overseas.

Payment systems

As with other areas of financial regulation, payment systems are heading for more extensive regulation. The Reserve Bank has recognised the economy's heavy reliance on certain key financial market infrastructures (FMIs), including payment systems, such as NZ Clear and the Exchange Settlement Account System, and in June 2019 it will release an exposure draft of the legislative framework aimed at regulating those 'systemically important' FMIs.

Internationally (eg Australia, UK and the EU), the trend has been towards heavier economic regulation of payment systems, including to promote competition. 

Open Banking

Open banking refers to technology (typically application programming interfaces, or APIs) used by banks and financial institutions to share customer data with third party service providers, enabling the provision of a range of different services, from alternative payment mechanisms to enhanced budgeting and accounting software. Open banking has the potential to increase competition in the financial services industry and give customers greater control over their personal data. However, open banking also raises concerns around privacy and cyber-security, which will require careful consideration.

The UK, EU and Australia have already taken steps to implement open banking, and the New Zealand Government has been watching closely. The Minister of Commerce and Consumer Affairs has been encouraging the industry to continue its progress towards developing an open banking framework. Most recently, this has led to Payments NZ releasing its API Centre, an industry driven initiative designed to centralise payment API standards in New Zealand and provide a sandbox environment for developers to test their open banking products against those standards.

Our experience

Our payment systems experience includes:

  • Acting for four major retail banks as shareholders in New Zealand's largest payment systems operator, Paymark, in respect of their participation in a mobile wallet initiative and the sale of that business to an EU-based payment systems operator.
  • Advising a major retail bank on the implications of open banking.
  • Advising a major retail bank in connection with its jointly developed payment app, the first of its kind in New Zealand.
  • Advising banks in connection with the procurement of e-commerce payment solutions, payment technologies and lending platforms.
  • Advising a large Australasian bank in connection with the development of various proprietary apps and related service offerings in compliance with New Zealand law
  • Assisting Northern Trust in respect of the supply of financial middle and back office platform services (including transfer agency, fund accounting and investment operations services) to various pension fund and financial services clients.
  • Advising a major retail bank on acting as a sponsor bank and the related merchant acquiring arrangements.
  • Acting for a major retail bank in relation to Commerce Commission investigations into the competition law implications of the structuring of credit card schemes and fees.
  • Acting for a number of major New Zealand retailers in relation to the implementation of both in-house loyalty schemes, and the establishment of relationships with third party loyalty scheme providers.
  • Acting for a major payment systems FinTech software provider in relation to contracts and joint ventures with financial institutions. 
  • Advising one of the world's largest multi-national banks on New Zealand's payment systems regulations.
  • Advising on the development of Zeal Systems as an open banking platform and the joint venture between major retail banks in commercialising this platform.
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