Statement of reasons

This notice is published in the Legislative Instruments series in accordance with the Legislation Act 2012. It was published in the Gazette on 14 August 2014, at page 2607.

This notice, which comes into force on 1 September 2014, extends the expiry dates for the Deposit Takers (Payment Facility Providers) Exemption Notice 2009 and the Deposit Takers (Funding Conduits) Exemption Notice 2010 (the Exemption Notices) to 31 March 2015.

The Exemption Notices currently provide exemptions from all of the prudential requirements under the Non-bank Deposit Takers (NBDT) regime for named payment facility providers and funding conduits.

Under section 73(1)(d) of the Non-bank Deposit Takers Act 2013 (the Act) the Governor-General may, by Order in Council, on the advice of the Minister responsible for administration of the Act given in accordance with a recommendation of the Reserve Bank of New Zealand (the Bank), make regulations declaring any person or class of persons not to be a non-bank deposit taker (NBDT) for purposes of the Act. The Bank has recommended that payment facility providers and funding conduits be declared not to be NBDTs for the purposes of the Act but regulations giving effect to the Bank’s recommendation will not be in force by 1 September 2014, which is the date on which the Exemption Notices are currently due to expire.

The Bank, after taking into account the principles set out in section 8 of the Act and after satisfying itself as to the matters set out in section 70(2) of the Act, considers it appropriate to extend the expiry dates of the Exemption Notices to allow time for the making of regulations declaring payment facility providers and funding conduits not to be NBDTs within the meaning of the Act. Requiring the persons named in the Exemption Notices to comply with the prudential requirements under the Act in the period from 1 September 2014 until being declared not to be NBDTs would serve no purpose and impose unnecessary compliance costs.

These reasons are supplementary to the reasons supporting the original grants of exemptions to payment facility providers and funding conduits.