Oct 112010

You’ve arrived off the plane as a backpacker with your working holiday visa, ready for your gap year, or you’ve moved over here as a resident and you need a bank account.  So how hard is it to set up a bank account in New Zealand?  The good news is it’s very easy, and this article will tell you what you need.

There are three things most people need to do as soon as possible after landing in New Zealand :

  • Set up your bank account
  • Get your IRD number
  • Get a SIM card for your mobile phone

It is best to set up your bank account as soon as you can after arriving.  It can take around a week for your bank cards to get sent out so you’d be better starting the process on day one then kick back and explore whilst waiting for your cards.  You will need the following items before setting up your bank account :

  1. Proof of address in New Zealand
  2. Passport and Visa
  3. Another form of ID such as home driving licence or bank card (ideally)
  4. Some cash to deposit (some banks ask you to deposit around $50 to open it)

You don’t generally need to provide a whole financial history like some other western countries.  The first thing you need to do is to get a proof of address document.  Most backpacker hostels will give you a letter confirming where you are staying particularly if it is one of the larger chains like Base.  This proof of address, along with your passport (and accompanying visa) and ideally some other form of ID like a bank card from your home country is pretty much all you need.  If you think you’ll move address before your cards arrive, check that your mail will be held or forwarded.  Depending where you are staying you may need both a physical address and a mailing address e.g. if your accommodation uses a postal box for their mail.

Many banks will ask you to deposit a small amount in your new account when opening it, so you should arrive with some cash in hand.

Main Banks in New Zealand

There are a few main banks in New Zealand, namely Westpac, ANZ, National Bank, BNZ (Bank of New Zealand), TSB and KiwiBank.  KiwiBank is the only one that is truly Kiwi owned so you may get some more smiles from the locals when you present one of their cards for payment.   All banks offer a number of accounts, but only a few are ‘fee free’ which suits most backpackers on a gap year, or travellers on a long term break.  If you are emigrating over here your requirements may be a bit different so you’ll have to do a bit more research.  Bear in mind that we are not financial advisors so the account you select is up to you – this article is just an overview to say it’s not a big deal to be worrying about.

Fee Free Accounts

In October 2010 the only ones we remember that were totally ‘fee free’ were BNZ and KiwiBank.  The good thing about KiwiBank is that they are owned by the same crowd as New Zealand Post so you’ll be able to perform transactions in every town that has a post office which can be a great help if you are travelling around.  If you are applying for your IRD number from Inland Revenue you can also do this at the same place you open your account, so it makes things a bit easier.

Note that although we use the term ‘fee free’ you’ll always find some charges that relate to your account from going overdrawn etc etc.  One notable charge that you may not be used to, particularly if you are arriving from the UK, is that if you withdraw cash from a different bank’s ATM or cash machine you may be charged a fee of up to a few dollars.  Due to this, if you’re on the move it pays to select which bank you open an account with carefully.  If you use KiwiBank you’ll also find that if you use telephone banking more than a few times a month you may get charged for it.

EFTPOS / Visa Debit

EFTPOS (Electronic Funds Transfer Point of Sale) is the most common method of paying for goods in New Zealand – so much so you may start to think it’s almost a cashless society!  You can pay using an EFTPOS for most goods and there’s not usually a restriction on lower limits so you can use your card just to buy a bottle of milk from the dairy.  Some outlets may give you ‘cash out’ at time of purchase to save you finding an ATM – ask them before they charge your card.  Getting cash out can be handy if you are in smaller places with less cash machines.

Note that some banks are starting to offer a Visa Debit enabled card which does EFTPOS as well.  This is a but more usable as you can make purchases online using one of these instead of using your home bank or credit card, and can use them abroad during that little side trip to the Pacific Islands you have planned!

Online / Internet Banking

Most banks in New Zealand have a comprehensive online banking solution available.  If you have any specific requirements check what the bank is offering you.

International Money Transfers

If you are transferring money from overseas to kick start your funds, ensure you ask for the correct details you need to be able to transfer cash.  This process can be really easy – as an example it only took 3 days to transfer cash from the UK to New Zealand when we set up our bank account so you can go begging to your parents as soon as you get your bank number and if you’re lucky you’ll have some entertainment money by the weekend!

Armed with the above information you’ve got all you need to be able to set up your bank account in New Zealand.  If you are travelling with visa organisations you may be able to get one set up in advance, but it’s so easy it’s not a big deal.  Larger hostels like Base will be able to give you some more information on arrival as to what the current deals are as they have job and information desks in house in the larger cities.  Now that you know what you need to set up your New Zealand bank account, have a read of our article about the Best Prepaid mobile SIM card for New Zealand.

If you have any information to add to this, or know of any top tips we’ve left out, please let us know using the comments below.

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