The New Zealand Department of Internal Affairs has published guidance for financial institutions that issue stored value instruments (SVIs) or manage the means of payment associated with them, setting out how the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 applies and when SVI services can fall within regulatory exemptions. The guidance covers both physical and electronically issued SVIs, including prepaid cards, gift cards and vouchers, and summarises the money laundering and terrorism financing risks associated with different SVI features. The guidance explains the two relevant regulations and the conditions under which SVI services are exempt from all provisions of the AML/CFT Act, including maximum value thresholds of less than USD 1,000 for SVIs redeemable for cash and less than USD 5,000 where not redeemable for cash, and a reloadability cap that prevents an SVI being reloaded with USD 10,000 or more in any consecutive 12-month period. It also sets out restrictions on reloads from certain accounts, and the “Linked SVI Conditions” that combine thresholds across operations that appear linked (with an exception for bulk sales where each SVI is intended for a different final recipient). Where thresholds or conditions are exceeded, the exemption is not available and full AML/CFT obligations apply, including customer due diligence and suspicious activity reporting where required; the guidance also clarifies that instruments such as credit cards, debit cards linked to an underlying account at a financial institution, and instruments storing virtual assets are not covered by the SVI regulations.
Department of Internal Affairs 2025-05-01
New Zealand Department of Internal Affairs issues AML/CFT guidance for stored value instruments and exemption thresholds
The New Zealand Department of Internal Affairs has issued guidance for financial institutions on applying the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 to stored value instruments (SVIs), detailing regulatory exemptions. The guidance covers physical and electronic SVIs, like prepaid and gift cards, and outlines associated risks. Exemptions apply under conditions such as maximum value thresholds of less than USD 1,000 for cash-redeemable SVIs and USD 5,000 for non-cash-redeemable SVIs, with a reloadability cap of USD 10,000 annually. It also clarifies that credit cards, debit cards linked to financial accounts, and virtual asset instruments are not covered by SVI regulations.