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The financial system explained

New Zealand has a sophisticated financial system involving many layers and players. We regulate the institutions depicted directly under the magnifying glass in this financial system graphic.

All of us rely on the successful day-to-day functioning of New Zealand’s financial system.

This graphic shows which institutions, markets and infrastructures make up the financial system and how they interact. At the heart of this financial system are New Zealanders, working and running businesses, spending, saving and investing.

Financial system image

The financial system includes all of the main institutions and markets you hear about everyday—like banks, finance companies, securities markets and insurance companies. It also includes ‘invisible’ market infrastructures like the payment and settlement systems. These make sure the millions of electronic financial transactions that happen each day are successfully delivered.

We assist the functioning of a sound and efficient financial system by regulating the financial institutions shown under the magnifying glass. The other institutions are regulated elsewhere, for example, the Financial Markets Authority regulates KiwiSaver providers and financial market intermediaries.

The financial system provides a robust framework for all of us to carry out economic transactions and to channel savings into investment, which helps to support economic growth.

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