Facing a rupture to online banking facilities after Credit Union Baywide moved to consolidate control, Co-op Money NZ had the High Court block Finzsoft Solutions’ plans to terminate support for its mobile banking.
The NZ Association of Credit Unions, known as Co-op Money NZ, provides back-office services for credit unions. Co-op Money signed a licensing agreement with Finzsoft in 2014 agreeing use of Finzsoft’s mobile banking app for credit unions’ banking customers. Co-op Money charges participating credit unions. About 10,000 retail customers regularly use the service.
The High Court was told one Co-op member, Credit Union Baywide, has moved aggressively seeking to gain effective control of the Co-op. Some credit unions have jumped ship. Co-op Money NZ had seventeen participating credit unions in 2014; down to three after Baywide sought effective control. Early November 2019, Finzsoft gave notice of termination; withdrawing Co-op Money’s use of its banking app. Finzsoft’s licensing agreement allows for termination if there has been a ‘change of control’ at Co-op Money.
At Co-op Money’s request, the High Court suspended operation of this termination notice. Co-op denies there has been a change of control as envisaged by the licensing agreement. Next step for Co-op Money is to start talks with Finzsoft triggering a dispute resolution procedure set out in the licensing agreement, Justice Wylie ruled. Co-op Money was warned not to dally; dispute resolution is to be started promptly. Meanwhile termination is suspended pending further order of the court.
NZ Association of Credit Unions v. Finzsoft Solutions (NZ) Ltd – High Court (4.12.19)
20.005