Bank fees are one of those expenses that often go unnoticed. Individual charges seem small, but over a year they can add up to $50, $100, or more. Understanding what you are being charged and whether better options exist is a straightforward way to reduce ongoing costs.
Types of Bank Fees
New Zealand banks charge fees in several categories, and the amounts vary significantly between providers and account types.
Monthly account fees range from zero to $15 or more depending on the account type. Many banks offer at least one everyday account with no monthly fee, but premium accounts with additional features typically charge $5 to $15 per month.
Transaction fees apply to some accounts for each withdrawal, payment, or transfer. Fee free accounts may have limits, such as the first 30 transactions free with fees thereafter. Other accounts charge per transaction from the first use.
Overseas transaction fees apply when using your card internationally or for purchases in foreign currencies online. Currency conversion margins of 1 to 3% are common, plus fixed fees of $1 to $5 per transaction in some cases.
Overdraft fees apply when your account goes into negative balance. Unarranged overdraft fees can be $3 to $5 per occurrence plus interest at rates around 20% or higher on the overdrawn amount.
ATM fees from foreign ATMs or non network machines typically cost $2 to $5 per withdrawal. Most banks no longer charge for using their own ATMs.
Paper statement fees of $1 to $3 per month apply at some banks if you receive printed statements instead of electronic ones.
Fee Free Everyday Accounts
Most major New Zealand banks offer at least one account with no monthly fee and no fees for standard electronic transactions. These include:
ANZ Go Account has no monthly fee, no card fees, and free unlimited transactions through EFTPOS, ATMs, and online banking.
Westpac Everyday similarly offers no monthly account fee with free standard transactions.
Kiwibank Free Up provides no monthly fee with unlimited free transactions for under 19s and over 65s, with reduced fees for others.
Heartland YouChoose offers no monthly fee, earns interest on your balance, and provides free local ATM usage for the first 10 transactions per month.
For most people, these fee free options provide everything needed for everyday banking. Premium accounts with monthly fees are typically only worthwhile if you specifically need their additional features.
Hidden Fees to Watch
Beyond obvious monthly charges, several less visible fees can accumulate:
Declined transaction fees of $1 to $3 may apply when a payment is declined due to insufficient funds.
Credit retrieval fees of $20 to $30 apply when you ask the bank to help recover money sent to the wrong account.
Paper cheque fees if you still use cheques can be $1 to $3 per cheque.
Duplicate statement fees of $5 to $15 apply for requesting copies of past statements.
Account closure fees apply at some banks, particularly for term deposits closed early.
Savings Account Fees
Most savings accounts have no monthly maintenance fee, but withdrawal fees are common. Banks structure these fees to discourage frequent withdrawals and encourage saving behaviour.
Notice saver accounts offering higher interest rates may charge $10 to $20 for early withdrawals before the notice period expires.
Bonus saver accounts may forfeit the bonus interest if you make withdrawals, which is effectively a hidden fee even if no explicit charge applies.
In branch withdrawal fees of $2 to $5 may apply to online only accounts if you need to withdraw in person.
Reducing Your Fees
Several strategies minimise bank fees:
Choose the right account type. If you rarely need branch services, an online only account with no monthly fee is likely your best option.
Consolidate accounts. Multiple accounts across different banks can mean multiple sets of fees. Consider whether you need all of them.
Use EFTPOS instead of cash. Avoiding ATM withdrawals eliminates potential ATM fees.
Set up overdraft protection. A small arranged overdraft costs less than unarranged overdraft fees.
Switch to electronic statements. The $1 to $3 per month for paper statements adds up to $12 to $36 per year unnecessarily.
Use free international cards for overseas spending. Some accounts have lower or no foreign transaction fees, and dedicated travel cards often beat standard bank cards for international use.
When Premium Accounts Make Sense
Premium accounts with monthly fees sometimes provide value through bundled benefits:
Included travel insurance may be worth more than the monthly fee if you travel frequently.
Higher interest rates on linked savings can offset the fee if you maintain significant balances.
Concierge services or lounge access appeal to frequent travellers.
Bundled insurance discounts through the bank's insurance arm may exceed the account fee.
Calculate whether the specific benefits exceed the annual cost before choosing a premium account.
Age Related Fee Exemptions
Many banks waive fees entirely for certain customers:
Under 19 accounts are typically fee free at most banks.
Over 65 superannuitant accounts often have no monthly or transaction fees, provided your NZ Super is paid into the account.
If you qualify for these exemptions, ensure you are on the correct account type to receive them.
Reviewing Your Bank Fees
Check your statements or transaction history for the past three months. Look for any recurring fees and calculate the annual total. Then check whether your bank offers a fee free alternative that meets your needs, or whether a different bank offers better value.
Switching banks is straightforward in New Zealand. Direct debits and automatic payments can be redirected, and the process typically takes two to four weeks.
Small Savings That Add Up
Bank fees are not dramatic expenses, but they are completely avoidable for most people. Switching from a $10 per month account to a fee free alternative saves $120 per year for no reduction in service.
Combined with avoiding overdraft fees, overseas transaction margins, and paper statement charges, the total savings can reach $200 per year or more for some households.
These are not life changing amounts, but they represent money flowing out of your account unnecessarily. Stopping that flow takes an hour of effort once, with benefits that continue indefinitely.
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