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Payments Explained


bank and branch number

The ‘bank number’ (also referred to as the interchange number) are the first two digits at the beginning of a bank account number, which tells us which bank the account resides with.

The ‘branch number’ is the next four digits in the account number, which tells us which branch of that bank the account is domiciled.


These numbers are used by the payment systems to direct payments to the appropriate Participants and customers.


The Bulk Electronic Clearing System.


The Consumer Electronic Clearing System.

Clearing System

A system used to settle payments between financial institutions.


Electronic funds transfer at point of sale.


The High Value Clearing System.

Industry Member

An organisation that has joined Payments NZ as an Industry Member. Industry Members must have a genuine business interest in payment industry initiatives and want to play an active part in industry-focused strategic conversations and initiatives.

Infrastructure Member

An organisation that has joined Payments NZ as an Infrastructure Member.  Infrastructure Members must want to take an active role in the management of our clearing systems and provide infrastructure services related to the operation of those systems.


When one Participant sends payment information about a transaction to another Participant. This information includes things such as which customer account the money needs to be paid into or taken from, transactional information and who initiated the payment.


An organisation that has joined Payments NZ’s Membership programme. There are three different kinds of membership: Infrastructure, Standards and Industry membership – which reflect the different kinds of organisations in the payment ecosystem.


A Participant exchanges payments directly with other Participants in one or more of the four clearing systems run by Payments NZ.

Payment information

The details that need to accompany a payment so the receiving Participant knows what the payment is for and the account the money needs to be paid into or taken out of.

Payment instrument

A generic term used to describe the different ways payments can be made. Examples of payment instruments include cash, EFTPOS payments, bill payments, automatic payments, cheques etc. See ‘Payment Types’ for more information.

Payment settlement system

A system used by Participants to exchange payment information and settle their payment obligations with other Participants.


The Paper Clearing System.

Rules and standards

Refers to the rules and standards set by Payments NZ, which govern the operation of the four clearing systems. The rules and standards are a multi-lateral contract between Payments NZ and all Participants.  They include various obligations and technical requirements that Participants must comply with.


Same-day Cleared Payment, is a payment instrument that is processed through HVCS and is often used for large value transactions where the recipient requires the payment to be confirmed in the same business day, for example house settlements.  See ‘Payment Types’ for more information.


Settlement Before Interchange.  Is New Zealand’s batch retail financial payment system, administered by Payments NZ, through which SBI Participants bi-laterally interchange and settle transaction files multiple times throughout each business day.  Settlement Before Interchange is the payment settlement system used by BECS, PCS and CECS.


The transfer of money from one Participant to another Participant, through the accounts held by the Participants at the Reserve Bank of New Zealand.

Standards Member

An organisation that has joined Payments NZ as a Standards Member. Standards Members provide or use payment products covered by our standards and want to be part of the ongoing development of those standards.


The Society for Worldwide Interbank Financial Telecommunications.  The SWIFT system is used by SBI and HVCS to send payment information between Participants.

SWIFT is a cooperative organisation dedicated to the promotion and development of standardised global interactivity for financial transactions.  More than 10,800 banking organisations, securities organisations and corporate customers in over 200 countries exchange millions of standardised financial messages daily via SWIFT. 


The infrastructure for sending payment information between Participants

Switch operator

The operator of the switches used to send payment information between Participants.

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