The Government 's depositor compensation scheme is on track to be operational by late 2024.

This scheme designed to ensure depositors are protected in the event of their bank, finance company, building society or credit union was originally expected to launch early 2024.

NZ Herald Wellington business editor Jenee Tibshraeny explained that setting up the levies banks should pay and the payout process is inherently complicated with lots of risks.

"The Reserve Bank and the Treasury have been working on this since 2017, so well before we started seeing these banks collapse overseas and the pandemic came along, and so on."

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