Meaning of Financial Services

Some examples of common financial services are below:

Providing financial advice (including investment planning)
Mortgages, saving and cheque accounts, and loans
Consumer loans and credit – such as when you buy an item from a retailer on credit or you obtain a cash loan
Issuing and managing means of payment (for example, credit and debit cards, cheques, travelers’ cheques, money orders, bankers’ drafts, and electronic money)
Money transfers
Foreign currency exchanges – whether buying or selling
Money management and/or advice
Investment management and/or advice
Insurance – including life, health, home/contents, and vehicle

Licensing requirements

In 2014, a system of licensing was introduced for some financial services providers, under the FMC Act. To provide certain financial services, providers must be licensed by the FMA. Under the FMC Act, a license will be noted on their FSP registration. The initial introduction of licensing was completed on 1 December 2016.

For example, they must show:

  • They are capable of providing the service effectively
  • Their managers and directors are 'fit and proper persons'
  • There is no reason for us to believe they are likely to contravene their license obligations.

Examples of licensed services

  • Managing a managed investment scheme
  • Discretionary investment management services
  • Derivatives issuers
  • Operating a crowdfunding or peer-to-peer lending platform.

License holders are proactively supervised and monitored by us as part of the terms of their license. It is important to emphasize that we do not regulate all financial services, providers and products. Some products and services are subject to regulation or supervision by other agencies, such as the Reserve Bank of New Zealand, Commerce Commission or the Department of Internal Affairs

Some are not licensed at all.

Where a financial markets service is required to be licensed, consumers should only deal with financial service providers licensed in New Zealand. Consumers can view our online lists of individuals, markets and businesses licensed and authorised to operate in New Zealand.