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Reserve Bank community cash service trials to start in 2024

Rural New Zealand communities lacking commercial bank over-the-counter or ATM cash services will be invited to take part in service trials starting next year of new ways to help individuals and retailers withdraw and deposit cash.

We will fund "Community cash service trials - He whakamātautau i te pūnaha moni a-rohe" which will start later this year (2024) in several communities.  The trials will test new ways for people, including retailers, to withdraw and deposit cash, including change and takings, at little or no cost to them.

“We know that New Zealanders, particularly in rural areas, still often rely on cash and value the certainty and convenience it provides, including when electronic options aren’t available or are off-line as we saw for large parts of the country during Cyclone Gabrielle,” says Ian Woolford, Director of Money and Cash. “This research project recognises the important role of retailers in the cash system and will test ways of ensuring that cash remains easy to get, spend, give as change, and bank.  

“We’ll be looking for 2 or 3 districts, ideally with a few communities with populations of less than 10,000 that have lost most or all bank-provided counter and cash services. We’ll work with these communities to confirm their cash servicing needs and what possible solutions to trial. We’ll also invite national stakeholder groups to take an interest and provide advice. The trials will run for about 18 months to inform our future work to support cash use and the cash system.

“Electronic payments generally add to retailer and customer costs, but banks’ withdrawal from offering suitable local cash services make it harder and more costly for retailers and customers to use cash.  We want the cash system to remain resilient, and retailers and individuals to continue to enjoy its social and economic benefits.

“As well as ensuring cash remains available and easy to use, keeping it circulating within communities is more cost and time efficient for everyone, and it’s better for the environment due to lowered demand for cash-related freight or travel,” says Mr Woolford.

How to register

Community or national representatives from iwi, local government, business, or voluntary sector groups can register their interest online, and we’ll be back in touch about the application process in April 2024. 

Register your interest

If you want to receive updates with major developments in the cash trials, you can sign up to receive our updates. Choose money, cash and payments policy in your preferred topics. 

Sign up for updates

Note: This page was updated in March 2024 with the project name and advice that the application process details would be available in April 2024.

Questions and answers

Cash allows individuals and groups to trade easily and instantly with each other. It supports cultural customs such as koha, family, community, and business life.

We know that about 6% of the population rely on cash to live their lives, and these people tend to be among more vulnerable groups — for example, the young, elderly or disabled. They may not have a bank account or online access for a variety of reasons.  People who rely on cash are also more likely to live rurally or be Māori.

Most of us want to have the option of paying in cash and do use it occasionally.  We also know that it’s a great back-up option when power and data essential to digital payments are down, as seen during extreme weather events.

While there is a continuing trend away from cash towards digital payments for everyday transactions, we know that some of that is driven by provider incentives to pay digitally — for example, points programmes or disincentives to deal in cash — for example, removing cash services from branches, increased travelling time to remaining branches or ATMs, and reduced opening hours. 

We know people value the option of using cash, even if they don’t use it very often. We want to explore how best to keep that option available. The trials enable us to explore new ways of providing cash services in a cost-effective way.

Digital cash would be another form of central bank money to circulate alongside cash, and not a replacement for it. We want central bank money – whether cash or any future digital cash– to be widely available and accepted.

Central bank money provides a state-backed alternative to money held in commercial bank accounts which rely on the strength of the bank concerned. 

Central bank money also provides a marker of value for the New Zealand dollar, helping make sense of prices, and what private money is worth and can be exchanged for.

Learn more about digital cash

We will be following typical public sector procurement processes where external support is needed for the researched trials. The method taken for each procurement will differ slightly depending upon factors such as scope, value, supplier market. We may use existing All of Government consultancy panels or closed tenders in some cases. Any procurement related advertising will be on GETS, the government electronic tender service.

No, our trials will avoid communities where NZBA is piloting 7 community banking hubs. We are supportive of the NZBA hubs work.  This is testing models for shared banking shopfronts, while our experiments are focused on keeping cash working in under-serviced communities, so we don’t want these two different and important experiments tripping each other up.

More information

Cash system redesign

Media contact

Peter Northcote
Senior Advisor External Stakeholders - Kaitohutohu Matua Kiriwhaipānga ā-Waho
Money and Cash – Tari Moni Whai Take 
Phone: + 64 04 471 3821
Email: [email protected]