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New Zealand Cards & Payments Market Report
- Published Date: February 2022
NEW ZEALAND CARDS & PAYMENTS MARKET
A comprehensive analysis of the cards, payments and consumer banking market in New Zealand, with expert commentary backed by reliable data.
With interchange fees set to be capped as this report goes to press, the industry is rethinking its profit pool mix.
On the acquiring side, Worldline's acquisition of a major local player has put it into direct competition with Eftpos NZ. However, QR codes may prove a game-changer, with WeChat Pay considering New Zealand a key market and the country's Covid tracking app deploying the technology, which may pave the way for a payments use case.
Lessons from this 2022 New Zealand payments report
How New Zealand'spayment ecosystem has been evolving.
What the pandemic has changed at the POS.
How merchant service fees here differ from Australia.
The effects of the incoming interchange regime.
NEW ZEALAND COUNTRY REPORT | KEY FACTS
- New Zealand has long been one of the world's most advanced electronic payments markets.
- Cash use is low, and consumers are quick to embrace new technology.
- With strong consumer penetration and merchant acceptance, the payment cards market is well established.
- Cards are the primary payment method: there were about 400 transactions per adult in 2020, making New Zealand one of the global leaders on this metric.
- Contactless has contributed to increased card use but has also led to increased charges for New Zealand merchants.
- The number of contactless-enabled terminals increased from 36 percent in January 2020 to 52 percent in December.
- Merchants must pay merchant service charges for contactless transactions but not for chip or magnetic-stripe transactions with debit cards.
- Retail banking, consumer finance and payments are largely controlled by four Australian lenders: Westpac, ASB, ANZ and BNZ.
- Competition in the payments market in New Zealand is set to intensify with the launch of Open Banking, which allows nonbanks live access to bank systems in order to provide tailored payment services to consumers.
- New Zealand is one of the most profitable credit cards markets in the world. Credit quality is high, while fees and charges are still unregulated.
- Issuers tend to take a segmented approach to credit cards: rewards cards, no-frills cards and balance transfers are key competitive products.
New Zealand Payments Research | Report Contents
TABLE OF CONTENTS
Demographics and the economy.
Payments environment.
Cards market.
Mobile payments.
Profit pool.
The networks.
Key retail banks and issuers.
Acquiring and processing.
Online acquiring.
Regulatory and other cards market information.
New Zealand Country Report Data Tables
(All 2015-24F unless otherwise stated)
1: Demographic and economic indicators.
2: Ownership of key consumer devices.
3: Internet usage by population.
4: Access points: 2015-22E.
5: Account penetration.
6: Consumer payment trends.
7: B2C e-commerce payment methods.
8: Total card payment metrics.
9: Contactless cards metrics.
10: Credit card numbers.
11: Total credit cards metrics.
12: Credit card profitability indicators.
13: Debit card numbers.
14: Debit card metrics.
15: Prepaid/e-money card metrics.
16: Profit pool including credit card numbers, billed volumes, outstandings, interest incomes, net interest revenues, merchant revenues, card fee revenues, other non-interest incomes, total revenues, net credit losses, operating expenses, total expenses, pre-tax profits, merchant service charges, rollover rates, APR, net credit losses to outstandings, operating costs to revenues, ROA (pre-tax profits to outstandings).
(All 2015-22F below unless otherwise stated)
17: Networks' credit card market shares.
18: Networks' credit card data numbers.
19: Networks' credit card billed volume.
20: Networks' number of credit card transactions.
21: Networks' average credit card transaction value.
22: Credit card interchange fees by network.
23: Networks' debit card market shares.
24: Networks' debit card data numbers.
25: Networks' debit card billed volume.
26: Networks' number of debit card transactions.
27: Networks' average debit card transaction value.
28: Debit card interchange fees by network.
29: Key credit card issuers market shares by credit card numbers: 2017-22F.
30: Key issuers market shares in credit card outstandings: 2017-22F.
31: Key debit card issuers market shares by debit card numbers: 2017-22F.
32: Merchant acquirer credit card market share: 2021E.
33: Credit card merchant service charges: 2015-24F.
34: Merchant acquirer debit card market share: 2021E.
35: Debit card merchant service charges: 2015-24F.
36: Credit card issuer/issuing processor relationships: -
37: Credit card acquirer/acquiring processor relationships: -
38: Credit card issuing processor market shares by card numbers: 2021E.
39: Credit card acquiring processor market shares by the number of POS transactions: 2021E.
40: Online merchant acquirer market share. 2021E.
New Zealand Country Report | Selected Extracts
Demographics and Economy
According to the World Bank, New Zealand has one of the least regulated market-based economies in the world. It ranks first in the list of easiest countries to start a business and second in the list of easiest countries in which to do business.
Payments Environment
New Zealand's payment ecosystem has been continually evolving with consumers adapting to innovations and alternatives such as payment cards, mobile and online payments at an ever-increasing rate.
Cards market
This payment cards market enjoys both strong consumer penetration and merchant acceptance. The average adult made about 400 card transactions in 2020, making New Zealand one of a select few countries worldwide where, as a statistical average, each person uses a card more than once per day.
Mobile Payments
Global heavyweights such as Google and Apple are starting to make their presence felt in this market with digital wallet offerings. A 2020 survey conducted by Visa showed that almost 40% of New Zealanders were willing to use mobile payments.
Profit Pool
New Zealand has a robust and established credit cards market which compares positively with global counterparts. Verisk Financial Research's analysis reveals steady profitability over the period covered in this report, with profits estimated to have reached $256 million in 2021.
Card Networks
New Zealand's competitive credit cards market is represented by four international networks: Visa, Mastercard, American Express and UnionPay. The New Zealand debit cards market remains dominated by domestic debit scheme Eftpos.
Key Retail Banks and Issuers
Banking in New Zealand is dominated by domestic institutions controlled by Australian Banks: ANZ, BNZ (owned by NAB), Westpac and ASB (owned by CBA). The largest domestically owned retail banks are Kiwibank and Cooperative Bank.
Acquiring and Processing
All four of New Zealand's major banks – ANZ, Westpac, BNZ and ASB – provide merchant acquiring services for both Visa and Mastercard credit card transactions. Two players dominate processing at the POS in New Zealand: Worldline (formerly Paymark) and Eftpos NZ. The former, by some distance, leads the market.
Online Acquiring
New Zealand is a developed B2C e-commerce market worth about $4 billion. More than half of the adult population made purchases online in 2020. Platforms (eg, marketplaces and app stores), as opposed to standalone company-branded websites, tend to be the sales method of choice.
Regulatory and Markets Information
In May 2021, a new law (the Financial Market Infrastructures Act), to regulate and supervise payment and settlement systems emerged from parliament. Under the new law, the RBNZ and the Financial Markets Authority (FMA) will be joint regulators of most financial market institutions.
New Zealand Payments Report | Entities Referenced
Afterpay
Air New Zealand
Alibaba
Alipay
Amazon
American Express
Apple Pay
ASB
Auckland Savings Bank
Australia and New Zealand Banking Group
Bank of New Zealand
BankDirect
BNZ
Bud
Buy-Line+ Online
CBA
CECS
Citibank
Click
Commerce Commission
Consumer Electronic Clearing System
Cooperative Bank
Credit Union Central
Datacom
Diners Club
Eftpos
EziBuy
Farmers
Financial Markets Authority
First Credit Union
Fitbit Pay
FlexiGroup New Zealand
Flo2Cash
Flybuys
FMA
Garmin Pay
GFG Group
Google Pay
Heartland Bank
HSBC
Humm
ICBC
IMF
Ingenico
International Monetary Fund
International Telecommunication Union
ITU
JCB
Kiwibank
Latitude Financial
Laybuy
Loyalty New Zealand
Mastercard
Mightyape
NAB
National Australia Bank
Nelson Building Society
New Zealand Bankers Association
New Zealand Post
New Zealand Wine Society
NZBA
NZPost
Online Eftpos
OPEN
Open Payments Enabled Network
Oxipay
PartPay
Paymark
Paymark Click
Paymate
Payment Express
Payments Direction
Payments NZ
PayPal
PayStation
payWave
Poli Pay
Project NEXT
Rabobank
RBNZ
Reserve Bank of New Zealand
Rugby World Cup
Samsung Pay
SBI
SBS Bank
Settlement Before Interchange system
Smartpay
Square
Statistics New Zealand
Stats NZ
Stripe
The Warehouse GrabOne
Trade Me
TSB
TWG
UniCard
UnionPay
VeriFone
Visa
Visa Accelerator Program
Visa Installments
Warehouse Money
WeChat
WeChat Pay
Westpac
Westpac Internet Payment Solution Plus
Windcave
WIPS Plus
Worldline
YouGov
Zip
MORE ASIA-PACIFIC CARDS & PAYMENTS REPORTS
Reports include detailed market and competitor intelligence on payments cards, e-money, acquiring, retail banking, and consumer credit in the Asia Pacific region. Analysts use primary and secondary source data and conduct in-depth interviews with senior industry executives and finance experts.
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