ASB has reversed its long-standing stance on POLi Payments, becoming the first local bank to formally partner with the controversial payment platform. Once a staunch critic of POLi’s security model, ASB is now embracing the service through the lens of open banking.
From Opposition to Endorsement
For years, ASB and other major banks warned customers against using POLi, which facilitated payments by asking users to enter their online banking credentials into a third-party interface. This approach was flagged by banks as a security risk, potentially breaching terms and conditions and exposing users to fraud. But now, in a reversal of its stance, ASB has announced a partnership with POLi that eliminates the old vulnerabilities and reintroduces the service in a more secure, compliant form.
Michael Maclean, ASB’s Tribe Lead for Everyday Money, acknowledged the tension that existed in the past. We’ve been “between a rock and a hard place” wanting to provide customers with choice and options to make payments – such as POLi – and the need to protect them from potential fraud,” he said, as reported by 1News. “It’s less about terms and conditions and more about the behaviours and risks associated with them.”
Open Banking: The Game-Changer
The pivot is made possible by New Zealand’s maturing open banking framework. Under the new arrangement, POLi no longer asks customers for their banking usernames or passwords. Instead, payments are initiated through POLi but securely authenticated within the ASB mobile banking app using the bank’s open banking APIs.
This means ASB customers can now complete payments without ever leaving their bank’s secure environment. The handoff to the ASB app ensures authentication is done directly by the bank, not a third party, effectively removing the security objections that once made POLi a pariah in traditional banking circles.
“Customer authentication and payment authorisation takes place securely within the ASB mobile banking app,” ASB explained in a statement. “We’re thrilled to be the first bank in the country to support POLi to embrace the open banking movement,” said Maclean.
A New POLi
The revamped POLi still enables customers to pay merchants directly from their bank accounts, bypassing card networks—but it now does so within a regulated, secure infrastructure. This evolution was not only welcomed but may have been necessary for POLi’s survival.
“If POLi had not been prepared to transition onto open banking, it might not have been able to continue to exist,” Maclean admitted. “Now there is a much safer alternative.”
Andrew Simmonds, POLi’s Commercial Director, described the partnership as a major milestone. “ASB is leading the way in this space,” he said. “We’re delighted to partner with them to provide Kiwi consumers an innovative and secure way to pay popular merchants.”
Implications for the Wider Sector
ASB’s endorsement of POLi via open banking is more than a one-off partnership—it’s a signal to the rest of the financial sector. The bank has been active in building out its open banking capabilities, launching its API platform in May 2024 and establishing six fintech partnerships to date.
With ASB leading the way, pressure may mount on other banks to follow suit. Open banking has long been discussed as a future-facing strategy for secure, real-time payments. Now, with a high-volume service like POLi legitimised under its umbrella, that future is arriving faster than many expected.
“We think it’s a real positive step,” Maclean said. “It’s part of an open banking journey and our fraud and scams journey.”
A Better Experience for Consumers
For end users, the change translates into more secure and convenient ways to pay online. Consumers can initiate a POLi payment as usual, but instead of entering their credentials into POLi’s interface, they are redirected to the ASB app to complete the transaction.
This avoids the past security pitfalls and gives customers more confidence and choice when paying online, especially as the service rolls out across POLi’s extensive merchant base, which includes major brands and government agencies.