India–New Zealand FTA to boost cross-border digital payments and financial services

India and New Zealand have agreed to expand cooperation in financial services under their recently concluded Free Trade Agreement (FTA), aiming to integrate banking, insurance, and digital payment systems between the two countries.

The FTA includes a dedicated chapter on financial services designed to create new market opportunities for Indian fintech companies. Under the agreement, New Zealand will allow Indian digital payment providers—including Unified Payments Interface (UPI) and other NPCI-backed platforms—to operate in its market.

Both countries will also collaborate on real-time cross-border transactions, a move expected to reduce remittance costs and improve settlement efficiency for businesses and individuals.

The pact ensures compliance with data protection norms while enabling cross-border digital operations. Indian financial institutions will receive non-discriminatory treatment in credit ratings in New Zealand, addressing concerns for lenders seeking global expansion.

The agreement also provides for higher foreign direct investment limits and more liberal branch licensing norms in banking and insurance.

Currently, only two Indian banks operate in New Zealand, while Kiwi institutions have no presence in India. The FTA aims to bridge this gap, encouraging New Zealand’s financial firms to explore India’s market, while giving Indian players access to a developed regulatory environment.

Experts note that the agreement offers Indian fintechs a structured entry point to deploy mature digital payment systems internationally.

Rohit Mahajan, Founder & Managing Partner at plutos ONE, said, “The India–New Zealand FTA is built on proven fundamentals of digital finance. Through institutions like NPCI, India has already demonstrated cross-border UPI linkages and payment interoperability with multiple international markets.”

For New Zealand, the partnership provides access to established digital infrastructure that can accelerate real-time remittances, merchant payments, and cross-border bill settlements. With the Indian diaspora driving significant remittance flows, faster payment rails could cut settlement time from days to seconds while lowering transaction costs.

The FTA also includes broader trade provisions, including the removal or reduction of tariffs on about 95% of New Zealand exports to India.