How long should I keep my bank statements for?
Although you are legally required to keep all statements for seven years, your bank will be able to provide statements at your request so this is not necessary, although some banks will charge a fee for providing you with statements. You should keep your bank statements for as long as they will be useful to you. They can be particularly useful when making a budget because you can highlight unnecessary expenses and know exactly what you're spending your money on.
Your bank statements also contain important details about who you are and how you spend your money. You should shred or destroy your bank statements before throwing them out to prevent identity theft.
Is it legal for a retailer to charge its customers a fee for using EFTPOS to pay small amounts?
Retailers can choose to charge a fee for EFTPOS, as long as they tell you before you pay for the goods. This information could be given verbally or by clear signage if it is unattended, for example at a petrol pump.
Retailers can also choose not to give you additional cash unless you make a minimum purchase. Dairies and convenience stores often operate like this.
What is the difference between an automatic payment and a direct debit?
An automatic payment is arranged with a bank by the person making the payment. It is used to make payments of a certain amount at a certain time to a certain account, sometimes on a regular basis. These payments are usually used to cover payments that don't change from month to month, such as rent payments.
In a direct debit agreement, you sign an authority form that is then kept at the bank. This gives an organisation authorisation to deduct money from your account at regular intervals amount you owe directly from your account on a periodic basis. Direct debits are a common way for people to pay phone and electricity bills which they have to pay each month, but which vary in amount.
Many people do not realise that direct debit payments can be withdrawn from your account when there is no money in it. This can result in you paying overdraft charges or honour or dishonour fees to the bank. Make sure you account for any direct debit payments when you do your budget.
I have had money removed from the bank by direct debit, but I have not signed any forms. What's going on?
No-one should debit money from your account without your authority and you can cancel a direct debit agreement at any time you wish. Companies can trade under different names, so it is possible that you may have given a business the authority to take a direct debit without realising what their trading name is.
Under New Zealand law, a company has to provide you with a statement of your account, so if a direct debit has been taken without you receiving an account statement, you should contact whoever is charging you, and check if they have your correct postal details so that they can send you your account statements.
If you are sure that you didn't give authority for a direct debit, ask your bank to show you a direct debit form with your signature as proof. If you did not give authorisation for the debit, you should ask the bank to help you find out who is getting the money, and ask them to cancel the payment.
If you want to cancel a direct debit, you should give written notice to the bank and whoever you are paying the money to that you will be cancelling the direct debit. If you ask the bank to cancel a direct debit, they must do so under the Code of Banking Practice. It is wise to cancel a direct debit yourself if a contract has finished, although it is the responsibility of the business taking the payments to do so.
Back to top
Why does it take so long for a cheque to clear?
Banks do not have access to the financial records of other banks' customers, and can't see how much money is held in an outside account. To cash a cheque, your bank contacts the bank that holds the cheque account to request money. After this, the other bank transfers the money which is received and added to your account. This process normally takes three working days unless the account is held at the same bank, in which case they will be able to process your cheque over the counter.
If the cheque is a cash cheque or addressed to you personally, and you can prove your identity, you can cash the cheque at the account that holds the cheque account (unless it is non-negotiable).
If it is urgent, your bank can contact the other bank manually to check if there is enough money in the account and initiate the transfer, but you will have to pay a clearance fee.
For more information on cheques, see the Ministry of Consumer Affairs page on banking.
Why does it take so long for money to be transferred with internet banking?
Every bank in NZ has 'processing times' when their electronic payments are made. If you make a request to transfer money electronically, your bank will do it during their processing time. If you're having trouble with the timing of payments, and would like to find out what time your bank processes its electronic transactions, you should call them and find out. If your money is being transferred from another bank, you can call the other bank and find out what time their transactions are processed.
Back to top
What is the difference between a debit card and a credit card?
A credit card allows you to spend money that you don't actually have, and works almost like a loan. The credit provider pays the person or business for you, and you pay them back for their loan with interest, if the money is not paid back before a certain time. A credit card can be good if you have enough income to pay back your credit debt in full before the repayment date each month, to avoid late fees and interest payments.
A debit card is different in that you must already have the money in your account in order to be able to use your card to spend it. You can still use it for the same sorts of purchases that you can use a credit card for, such as buying things over the internet. Having a debit card rather than a credit card can be a good idea if you're living on a tight budget, as it allows you more freedom in how you can pay for things, but also limits your spending so you don't get into trouble with credit card debt. Debit card fees are typically less than credit card fees.
The bank gave me an account with an overdraft facility, though I didn't ask for one. Now I owe them hundreds of dollars because I didn't realise I was in overdraft. Is there anything I can do?
If your bank has given you an overdraft facility without your permission, it may have been a normal feature of the type of account you selected when setting up the account. If it is not a typical feature, you should discuss with the bank why they have done this, and ask them to cancel the overdraft.
Unfortunately, if you have spent the money, there is not much you can do to get it back from the bank. If you believe you would not have spent the money if you'd known it would put you in overdraft, you can ask the bank not to charge you overdraft fees or extra interest on the money while you pay it back. It is up to them whether or not they do this. If you believe that they are being unfair or behaving poorly, you can lodge a complaint with the Banking Ombudsman.
I've had a problem with a bank. Who can I complain to?
Most banks have their own complaints procedure which they will tell you about. Depending on which bank you are dealing with, the usual steps are
- call the customer service centre and talk to one of the staff about your complaint or talk to a staff member at your own or any other branch
- if you're not satisfied after that conversation, contact your branch manager or your account manager
- if you're still not satisfied, talk to the regional or district manager
Some helpful tips when you're talking to your bank about a problem are
- know exactly what the problem is and what you'd like your bank to do about it (putting it in writing may help to clarify the issues)
- take notes during any conversations you have with your bank, for example the time and date, who you talked to, and the outcome of the conversation
- keep copies of any letters or e-mails you sent to or received from the bank
If you can't agree with your bank on the solution to your problem, or haven't heard from them for three months, a 'deadlock' has been reached, and you can then make a complaint to the Banking Ombudsman.