Change to banking

From 26 May 2023, banks will be processing payments to and from other banks daily, not just on business days (including weekends and public holidays).

How will this affect you? Previously if you made a payment to another bank on the weekend or public holiday these wouldn’t be processed until the next business day. For example, your rent is due to be paid on a Friday each week but didn’t due to the Good Friday public holiday, your payment didn’t actually transact until the following Tuesday.  As of the 26 May 2023, payments will be processed 365 days a year, so this will no longer be an issue. 

We all need to ensure we have the correct funds in our accounts on the correct days as we may get caught out with payments bouncing and, in turn, fees or penalties. If you run your bank accounts to the day and know when money isn’t going out because of weekends, you need to be specifically mindful of this. If you transfer money from a savings account to a normal account to be ready for a credit card direct debit or different direct debits, be mindful of this so that these don’t bounce, and you end up with late payments/interest on unpaid credit cards or transactions.

In some cases, it looks like unprocessed direct debits (due to lack of funds) will not be tried to be processed again, so don’t get caught out. If your home loan repayments, business loan payments, term deposits and savings account payments fall on weekends or public holidays, they will still go out. Businesses paying tax will need to be mindful of due dates that fall on weekends and public holidays that the IRD often allows to be paid the following business day.

This also means that if you are transferring money to your friends on the weekend or buying things online, the payment will be processed that day. Employers will need to work out what they do with salary payments when the usual payment date falls on a weekend or public holiday. Pay on that day or process the payroll on that non-business day. Some businesses may reference ‘business days’ in their terms and conditions but will need to update this if it is no longer applicable. Your bank will have more information on this, and you may want to have a read to ensure that you are across all of the changes for the specific banking products you use. One of the banks states that payments between NZ banks will be processed every half hour between 9:00am and 11:55pm, 7 days a week. The key here is it’s super important to make sure there’s enough money in your bank accounts when the payments are due, so you’re not caught short. This is a good reminder to have a think about how you have your payments set up.

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