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New Zealand law explained for everyone

Deposit Takers Act 2023

Depositor compensation scheme - Entitlement to compensation - Entitlement rules

204: Protected deposit held by or on behalf of 2 or more persons jointly

You could also call this:

"What happens to your joint bank deposit if something goes wrong"

Illustration for Deposit Takers Act 2023

If you have a protected deposit with someone else, this law applies to you. You can have a deposit with someone else in two ways: you can own it together with them, or someone can hold it for you and others.

When the law looks at your deposit, it treats each person as having an equal share, unless there are records that say otherwise. These records can be from the bank or from the person who holds the deposit.

Your share of the deposit is used to calculate how much compensation you might get under section 203, unless the regulations say something different.

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This page was last updated on

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS502614.

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Money and consumer rights > Banking and loansBusiness > Industry rules
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203: Calculation of entitlement, or

"How much money you can get back if your bank or deposit taker fails"

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205: Protected deposit held by or on behalf of 2 or more persons other than jointly, or

"Protected deposits shared by two or more people, but not owned together"

Part 6Depositor compensation scheme
Entitlement to compensation: Entitlement rules

204Protected deposit held by or on behalf of 2 or more persons jointly

  1. This section applies if a protected deposit is held—

  2. by 2 or more persons in their own right jointly; or
    1. for, or on behalf of, 2 or more persons jointly under 1 or more relevant arrangements.

      1. For the purposes of this Part,—

      2. each of the persons must be treated as having—
        1. an equal share in the protected deposit (unless subparagraph (ii) applies); or
          1. the share in the protected deposit that is specified in records that are maintained by the licensed deposit taker, or provided by the holder of the protected deposit, in the manner prescribed by the regulations; and
          2. a person’s share in the protected deposit must be taken into account in calculating their entitlement (if any) to compensation under section 203 (except to the extent that the regulations provide otherwise).

            1. Subsection (2) applies whether or not each person is an eligible depositor (but a person who is not an eligible depositor is not eligible to compensation in respect of their share).

            2. This section does not affect the rights of those persons as between themselves.