Shakeup Proposed for NZ Banking Sector to Spur Innovation and Consumer Choice
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A major investigation into New Zealand’s personal banking by the Commerce Commission has found that the big banks are not competing enough, which is bad for customers.
The study showed that the big four banks – ANZ, ASB, BNZ, and Westpac – are making lots of profit but aren’t innovating or investing in technology as they should.
This situation has created a market where there’s little real competition, and customers are missing out on better services and products.
What’s Being Done:
The report suggests several big ideas to shake things up:
The aim is to break the current hold the big banks have on the market, leading to more innovation and better choices for customers.
Why It Matters:
The lack of competition in New Zealand’s banking sector isn’t just about money; it’s a social issue, affecting particularly those in less advantaged positions. People in rural areas or those with less financial literacy, for example, often don’t have the same access to banking services, widening the financial inclusivity gap. This calls for a banking sector that is more accessible and beneficial to all New Zealanders, ensuring fair and comprehensive access to financial services.
Next Steps:
The Commerce Commission is asking for feedback on its suggestions until April 18, with a final plan set to come out in August 2024. They’re looking to make lasting changes that will make banking better and fairer for everyone in New Zealand.