The Government says an inquiry into the banking sector opposition MPs intend holding is pointless.
It says the banks cannot be forced to appear but the Labour Party says some banks have indicated they will have their say on their interest rates.
Labour, along with the Greens and the Progressives, will hold the inquiry, without the support of the Government.
They say it will be run along similar lines to a select committee investigation, and will seek submissions from organisations including banks.
The parties want to investigate why short term interest rates are falling slower in the marketplace than in the Official Cash Rate.
Labour's finance spokesperson David Cunliffe says the facts should be put on the table so people can see if they are getting a fair deal from the banks.
Mr Cunliffe says several banks have assured him of their co-operation.
Kiwibank says it will participate if invited. Other major trading banks say they'll respond once they have more information about the scope and nature of the inquiry.
The Progressive Party's sole MP, Jim Anderton, says serious questions need to be asked about why the Australian-owned banks are charging higher interest rates to New Zealanders than it does Australians.
Mr Anderton says overseas-owned banks took $11.7 billion out of New Zealand last year in interest and profits.
He says there is no excuse for the banks' behaviour and doubts customers accept that either.
'Pointless exercise'
However, Prime Minister John Key says his National Party will not take part in the inquiry, as it is not needed.
And the Finance Minister, Bill English believes the inquiry will achieve little.
"No inquiry by members of Parliament can compel anyone to do anything, particularly what is just a discussion among opposition politicians," he said.
"When those opposition politicians were the government, bank margins and profitability were at record highs, so I don't think they're in a position to lecture anyone else about it."
A senior lecturer in banking studies says it's meaningless, as it is searching for a problem which no longer exists.
Claire Matthews from Massey University says the impact of the recession is being felt in the banking sector.
She says the banks in New Zealand and Australia are operating in two different markets, with different interest rates, and customers can't expect them to be the same.
Ms Matthews says it is unclear what changes could be made to address that.
Banks' reaction
Banks in New Zealand have always said interest rates are held up by the high cost of borrowing overseas.
BNZ says there should be proper debate on these matters but the inquiry may not achieve those goals.
The Bankers Association says it is up to individual banks to decide on the extent, if any, of participation in the review.
ANZ-National says it will consider any invitation to speak to the inquiry when it is received, but is not commenting further.
ASB says it will consider its decision to participate once it has received clarity about the inquiry's nature and scope.
Westpac had not made any comment regarding the issue on Tuesday.
