A Look Ahead report from law firm Chapman Tripp indicates that 2025 will be regarded as a pivotal year for the banking sector.
Luke Ford, partner at Chapman Tripp and author of the report, said Generation Z, born between 1997 and 2012 and now aged 13 to 28, will transform how the industry interacts with customers.
“Young, digitally savvy New Zealanders are demanding new types of financial services, forcing banks to innovate or risk losing relevance. Their appetite for alternative products is reshaping the market,” Ford said.
“Major reforms – such as open banking, a new Depositor Compensation Scheme, and stricter capital requirements – are bringing New Zealand in line with global standards but also creating new pressures and opportunities.”
“As traditional banks adapt, smaller and non-traditional players are poised to thrive, especially those offering superior digital experiences or higher returns.”
The report cautions that those who do not innovate and adapt to evolving customer expectations face potential risks ahead.
“Without bold innovation, New Zealand risks lagging behind global banking systems that are rapidly advancing in digital payments and capital mobility.”
Ford said that attempts to align regulations with global best practices could be weakened by local regulatory disputes, risking stagnation at a crucial moment for innovation.
He said the changes would impact everyone, from individual savers to large businesses.
“The banking experience is set to become more digital, more competitive, and more aligned with international trends than ever before.”
Ford said regulators will need to act swiftly to stay ahead of the changes.