Banks, other major institutions, and the Reserve Bank – Te Pūtea Matua use the Exchange Settlement Account System (ESAS) to settle transactions between us. We are part-way through a review of access eligibility criteria to use ESAS. This is an update on that work for our website subscribers following Money, Cash and Payments Policy developments.
We consulted last year on a proposed approach to the ESAS access risk framework. Today, we have updated the consultation page of our website and published the submissions we received.
Feedback was largely positive with two significant issues raised around requests for ESAS accounts for non-settlement purposes, and clarification on how the policy would balance objectives around innovation and competition with requirements for integrity and reliability. When we published the Summary of Submissions in October 2023, we advised that the feedback warranted more research.
This has led to a revised approach which aims to balance our initial risk-based approach with considering the benefits ESAS access brings, particularly around innovation and competition.
As a result, we are now targeting late 2024 to release the final policy and open invitations for new ESAS applications from non-Bank applicants.
It is important we get the policy right as ESAS is at the heart of our financial system and keeps our economy moving, so we are taking a robust and risk-adverse approach.
