Revolut has been registered as a bank in New Zealand, the Reserve Bank of New Zealand announced on Tuesday 3 November. Revolut Bank New Zealand Limited becomes the country's 27th registered bank.
RNZ described it as New Zealand's first fully digital bank. The company has no branches. Customers manage their money, exchange currencies, spend overseas and make payments through an app.
Revolut has operated in New Zealand as a financial services provider since July 2023, the Reserve Bank says. Many migrants and international students already use it to send money home or pay for things in other currencies. Registration changes what kind of protection some of that money has.
What the Reserve Bank said
Scott McKinnon, the Reserve Bank's director of specialist supervision, said the bank recognised "the value that credible new entrants can bring to a competitive, resilient, inclusive and efficient financial system" and was pleased Revolut NZ had met the required standard.
Revolut was registered under the Banking (Prudential Supervision) Act 1989. That regime is being replaced by the Deposit Takers Act 2023, which the Reserve Bank says comes into force on 1 December 2028.
According to interest.co.nz, the registration followed an almost two-year process, and Revolut began seeking registration in 2024. RNZ reported the company, which says it has 80 million customers worldwide, has committed to investing $120 million in its New Zealand operations.
How much is protected?
The Depositor Compensation Scheme (DCS) protects depositors up to $100,000 if their deposit taker fails, the Reserve Bank says. Cover is automatic if the money is in a DCS-protected account, such as a transaction account, a savings or notice account, or a term deposit.
Revolut says eligible deposits in its Instant Access Savings account are protected by the DCS up to $100,000.
The limit applies per depositor across all of their DCS-protected accounts with that one deposit taker. Each deposit taker must keep a list of its DCS-protected deposits on its website.
What is not covered
This is the part that matters most for people who hold several currencies. The Reserve Bank says money held in foreign currency accounts is not protected by the DCS.
So New Zealand dollars in an eligible Revolut account can be covered, but balances held in, for example, US dollars, Indian rupees or Philippine pesos are not covered by the scheme.
Also excluded, according to the Reserve Bank:
- bonds and other tradable products
- KiwiSaver and other superannuation schemes that are managed investment schemes
- money lost to scams, fraud or hacking
The last point is worth noting. The DCS is there for when a bank fails. It does not pay out if someone tricks you into transferring money or gets into your account.
The Reserve Bank suggests asking your deposit taker if you are unsure whether your money is protected.
Children's accounts
Children's accounts are treated the same as any other eligible depositor, with the $100,000 limit applying across protected accounts in their name, the Reserve Bank says. If a child's account is not in the child's own name, it is counted together with the account holder's deposits.
The introductory rate
As part of the launch, Revolut is offering new personal customers a variable introductory savings rate of 3.50 percent a year for four months, on balances up to $50,000, according to Revolut's announcement reported by interest.co.nz and 1News. Revolut says interest is paid daily and there are no withdrawal penalties.
After four months, Revolut says balances move to an ongoing variable rate based on the customer's plan: 2.00 percent for Standard and Plus, 2.25 percent for Premium, 2.75 percent for Metal, and up to 3.00 percent for Ultra. Those rates are set by Revolut and can change.
Competition
RNZ reported the four big Australian-owned banks hold over 80 percent of the New Zealand market, and Revolut is hoping to challenge them. Revolut said this was its seventh bank licence worldwide and its fifth this year.
If you already use Revolut, check in the app which of your balances are in New Zealand dollars and which are held in other currencies, as that decides whether the DCS applies.
