On Jul. 15, 2025, NZ CB announced the second phase of the ESAS application process will open in Sep. 2025 for interested payment service providers, overseas deposit takers and operators of designated financial market infrastructures (FMIs).
Information on the phase 2 application process and guidance on requirements to meet the access criteria will be published on NZ CB's website in Sep. 2025.
NZ CB published document titled ESAS access review: risk assessment framework for ESAS - consultation paper re a new risk assessment framework (RAF) it is proposing.
Said that this new framework is to evaluate applications to bank with NZ CB directly.
Context
NZ CB's exchange settlement account system (ESAS) is currently used by 12 major banks, 5 large institutions, and NZ CB to settle transactions immediately, irrevocably.
It receives regular approaches from a variety of institutions seeking access to ESAS.
Proposal Overview
Broader access could enable and encourage welcome innovation in financial system.
It may also pose risks; proposal seeks to provide a fair and transparent way to assess an ESAS applicant’s risk profile as well as considers relevant international standards.
This paper provides overview of issues NZ CB needs to consider as it contemplates allowing new participants into its ESAS; NZ CB is also presenting its objectives for ESAS and where these objectives may be further supported by a wider access policy.
A proposed access policy will be the subject of a subsequent public consultation.
It is also consulting on a new RAF that it thinks could help it to assess risks of opening up access to ESAS; RAF is intended to take a comprehensive view of the potential risks as well as map them in a way that supports the development of transparent criteria.
Next Steps
NZ CB said it intends to analyze feedback and then consult on a revised ESAS access policy before end of Sep. 30, 2023, and announce the final policy by Dec. 31, 2023.
Said that NZ CB intends to be processing applications using final policy in early 2024.
Effectiveness
The comment period for this consultation closes on Jul. 27, 2023.
In Nov. 2024, NZ CB issued a proposal with respect to access criteria, see #228867.
Mar. 2025 Access Expansion
On Mar. 31, 2025, NZ CB announced approval of revised access criteria for exchange settlement account system (ESAS) following the comprehensive public consultation.
New criteria will expand ESAS eligibility to more non-bank entities in two phases; first phase will grant access to licensed non-bank deposit takers (NBDTs) in New Zealand.
Second phase will extend access to other entities meeting the criteria, potentially including payment service providers, overseas deposit takers, operators of designated financial market infrastructures (FMIs); revised policy aims to broaden ESAS access.
NZ CB finalizing details and data for potential applicants to open application process.
Apr. 2025 Application for NBDTs
On Apr. 7, 2025, NZ CB said the application process is open to NBDTs accessing ESAS.
NZ CB has updated the website with the revised access policy and criteria, and information for phase 1 applicants (licensed NBDTs) to begin the application process.
Interested NBDTs shall complete the expression of interest (EOI) on the website.
The application process to other non-bank entities is expected in third quarter of 2025.
Document dated Apr. 7, 2025, received from NZ CB Apr. 12, summarized on Apr. 16.
Jul. 2025 Second Phase Announced
On Jul. 15, 2025, NZ CB announced the second phase of the ESAS application process will open in Sep. 2025 for interested payment service providers, overseas deposit takers and operators of designated financial market infrastructures (FMIs).
Information on the phase 2 application process and guidance on requirements to meet the access criteria will be published on NZ CB's website in Sep. 2025.
