Non-banks can call themselves banks
The Reserve Bank says all deposit takers licensed under the Deposit Takers Act will be able to call themselves banks.
Thursday, June 4th 2026, 9:03AM
All deposit takers will be able to call themselves banks if they become licensed under the Deposit Takers Act.
Use of the words 'bank', 'banker' and 'banking' is restricted under current law to help the public identify which entities are subject to prudential regulation. When the DTA comes into full effect on December 1, 2028, all licensed deposit takers, including entities currently licensed as non-bank deposit takers (NBDTs), will be able to use these restricted words. Overseas banks that do not have a physical presence in New Zealand can continue to use restricted words, as is authorised under the DTA.
“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, which was largely supported in consultation feedback,” Acting Assistant Governor Financial Stability, Angus McGregor says.
As well as introducing the Depositor Compensation Scheme, the DTA provides for new supervision powers and a framework for managing and resolving a deposit taker in financial distress. The DTA also gives RBNZ greater power to monitor deposit taker stability and step in if a deposit taker’s financial situation or business practices are putting depositors’ money, and New Zealand’s financial system, at risk.
“The DTA provides for closer regulation of all deposit takers and gives us new powers to make sure entities able to call themselves banks are doing the right things to keep depositors’ money safe,” McGregor says.
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