Skip to content

Term Deposit
Product ID PRD-003
Launch tier 1
Jurisdiction NZ + AU
Status Planned
Regulations AML/CFT Act 2009 · AML/CTF Act 2006 · Privacy Act 2020 · Privacy Act 1988

A term deposit holds a fixed sum for a nominated term at a fixed interest rate. The rate is locked on the opening date and does not change for the duration of the term. Proceeds are disbursed automatically at maturity per the customer's standing instruction — no branch visit or manual action required.

Key terms

Term Value
Account type Fixed-term deposit
Currency NZD (NZ) / AUD (AU)
Available terms 30 days to 5 years (per institution configuration)
Minimum deposit Per fee schedule
Interest rate Fixed for term at rate prevailing on opening date
Interest payment At maturity for terms ≤ 12 months; monthly or at maturity for terms > 12 months (customer selects at opening)
Early withdrawal Permitted; break cost applies
Break cost (contract rate − current reinvestment rate) × balance × (days remaining / 365); minimum zero
Default maturity instruction Auto-rollover to same term at prevailing rate
Pre-maturity notifications 30, 14, and 7 days before maturity date
Statement frequency At maturity; annually for terms > 12 months

System capabilities

  • Maturity notifications sent automatically at 30, 14, and 7 days before the maturity date — no customer action needed to receive them.
  • Maturity proceeds disbursed on the maturity date per standing instruction with no manual intervention.
  • Break cost calculated in real time and disclosed before any early withdrawal — customer must accept before funds are released (MOD-111 + MOD-007 gate).
  • If market rates have risen since opening, break cost is zero — calculated and confirmed in-session.
  • Rollover confirmed same-day at prevailing rate; the new rate is visible before the customer confirms.
  • Maturity instruction changeable via the app up to one business day before maturity.

Eligibility

Assessed automatically by MOD-105. Standard eligibility requires verified KYC (MOD-009), CDD tier assigned (MOD-010), no active sanctions match (MOD-013), and jurisdiction match (NZ or AU). Existing customers with a verified record on file proceed without repeating the identity flow.

Account opening

The customer selects a term and confirms the amount through the app. MOD-050 delivers the disclosure statement. MOD-049 captures consent. MOD-007 transitions the account from PENDING to ACTIVE and MOD-001 posts the opening debit from the funding account. The fixed rate applicable at opening is displayed and confirmed before funding. The full process completes in-session.

Fees

Fee type Amount
Minimum deposit Per fee schedule
Early withdrawal break cost Calculated per formula (see below); minimum zero
Paper statement fee Per fee schedule

Interest

Interest accrues daily using the formula: daily_interest = balance × (fixed_rate / 365). For terms of 12 months or less, interest is credited at maturity in a single posting. For terms greater than 12 months, interest is credited monthly or at maturity per the customer's selection at opening.

Withholding tax (Resident Withholding Tax in NZ; Tax File Number withholding in AU) is deducted from interest payments at the applicable statutory rate unless the customer has provided a valid exemption at account opening.

Statements

Generated by MOD-113. For terms of 12 months or less, a statement is issued at maturity. For terms greater than 12 months, statements are issued annually and at maturity. Statements are delivered to the in-app document vault and available as PDF download. Retained for 7 years.

Closing / exit terms

At maturity: proceeds (principal plus accrued interest) are disbursed per the standing maturity instruction. The account transitions to CLOSED via MOD-007. If no instruction is set by the deadline (close of business, two business days before maturity), the default instruction — auto-rollover to the same term at the prevailing rate — is applied automatically.

Early withdrawal: MOD-007 blocks withdrawal from a term deposit until MOD-111 has calculated the break cost and the customer has explicitly accepted it in the same session. Acceptance is recorded as an immutable consent event. Break cost formula: max(0, (contract_rate − reinvestment_rate) × balance × days_remaining / 365). The reinvestment rate is the prevailing rate for the remaining term at the time of the request.

Maturity instructions may be changed via the app at any time before the instruction deadline. Options: roll to same term; roll to a different term; withdraw all to nominated account; partial rollover and partial withdrawal.

Regulatory

New Zealand: Banking (Prudential Supervision) Act 1989; AML/CFT Act 2009; Privacy Act 2020; Financial Markets Conduct Act 2013. RWT applies to interest income.

Australia: Banking Act 1959; Financial Claims Scheme (APRA); AML/CTF Act 2006; Privacy Act 1988. TFN withholding applies to interest income.

Governing policies

  • CON-001 — Customer Fairness & Conduct Policy
  • CON-004 — Product Disclosure & Sales Practice Policy
  • CON-005 — Fee & Pricing Transparency Policy
  • PAY-001 — Payment Operations Policy
  • AML-003 — Know Your Customer (KYC) & Identity Verification Policy
  • PRI-001 — Privacy Policy
  • CON-006 — Product suitability and governance

Implementation modules

Module Name Status
MOD-001 Double-entry posting engine Deployed
MOD-002 Immutable transaction log Deployed
MOD-003 Real-time balance engine Deployed
MOD-005 Daily accrual calculator Deployed
MOD-006 Rate change propagation Deployed
MOD-007 Account state machine Deployed
MOD-044 JWT role-based access control Deployed
MOD-049 Open banking consent management Deployed
MOD-050 Disclosure enforcement module Deployed
MOD-068 Authentication & session management Deployed
MOD-105 Product eligibility engine Not started
MOD-110 Fee engine Deployed
MOD-111 Term deposit maturity engine Deployed
MOD-113 Statement generation Not started

Compiled 2026-05-22 from source/entities/products/PRD-003.yaml