The number one cause for this unease was receiving a negative response from others, with nearly half of those surveyed saying they felt self-conscious over the display of affection.
Almost a third said they had been made to feel uncomfortable due to negative responses from others.
Young Kiwis (those born in the 80s and 90s) were the group most inclined to feel uncomfortable about public hand-holding while Gen X, (born in the 1960s to late '70s) came in a close second and Baby Boomers (born in 1946 to '64) were at a low of 15 per cent.
Of those polled, 73 per cent said they felt most comfortable holding hands in front of their extended family, but least likely to feel comfortable in front of an elderly stranger.
The findings are the inspiration behind ANZ's #HoldTight campaign which was launched today in support of the LGBTI community.
Watson said: "We're hoping Kiwis jump on board the campaign and demonstrate how we live in an accepting and open society that's proud to celebrate diversity,"
Auckland couple and ANZ staff members Teresa Cropp and Toni Fraser said at times they've felt self-conscious holding hands, especially around older generations.
"It's such a natural thing to do but I was worried about the response I'd get from strangers, like a rude stare or snide remark.
"As a member of ANZ and the Pride community, I'm proud we're having this conversation and hope others will feel encouraged by the campaign," Cropp said.
Cropp and Fraser will lead ANZ marchers at the Pride Parade holding hands, the longest period of time they have done so in public.