While this goes some way to satisfying the Government’s request for banks to make way for more competition in the payments space, it doesn’t oblige banks to engage in open banking. Nor does it prevent banks from using armies of lawyers to make it too difficult or costly for third parties to partake in open banking.

The purpose of Payments NZ’s API Centre is to create a space where banks and accredited third parties can collaborate and use shared resources for an annual fee. They can access standardised technology known as APIs (application programming interfaces), as well as the standards Payments NZ has created around using these.

Then if Bank X decides it wants to link up with Tech Company Y, so that its customers can transfer their bank transaction histories to Tech Company Y and use its innovative app to do their personal budgeting for example, the two companies need to negotiate their own agreement. For example, Tech Company Y would have to satisfy whatever privacy and security requirements Bank X has to ensure its customers’ data is safe. The two companies would also have to make agreements around how risk/liability and costs are shared, and decide how their set-up is administered.