The program of different tracks for current account fees takes effect today

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The amendment to the Banking Regulations (Customer Service)(Fees), 5768–2008 requiring banks to include the basic track and the expanded track within the current account management services they offer their clients takes effect today, April 1, 2014.
 
Until now, the banks charged a fee for each activity in the current account, whether the activity was a teller-executed activity or customer-executed activity.  (A list of the activities included in the definition of activities through these channels is in Appendix A.)  Accordingly, the monthly payment differed each month based on the number of activities actually executed by the customer.  As of today, the banks are required to offer their customers an additional pricing method: one price for the basic services inherent in managing a current account (a basic track or an expanded track).
 
The basic track includes up to 10 customer-executed activities and up to one teller-executed activity.  The price for the basic service is under supervision and may not exceed NIS 10.  The expanded track includes up to 50 customer-executed activities and up to 10 teller-executed activities.
 
The following are the prices of the basic track and the expanded track at the various banks:

 

NIS
Hapoalim
Leumi
Discount
Mizrachi
First International
Union
Mercantile
Otzar Hahayal
Masad
Yahav
Poalei Agudat Yisrael
Bank of Jerusalem
Arab Israeli Bank
 
Basic track
10.0
10.0
9.0
9.0
9.0
10.0
8.5
10.0
10.0
10.0
9.0
0.0
10.0
Expanded track
22.0
20.0
25.0
29.0
26.0
24.0
26.5
27.0
30.0
20.0
29.0
0.0
20.0

 

Some of the banks are also offering an additional premium (expanded-plus) track that includes the activities in the expanded track plus additional services that are unique to each bank.

 
In order to assist bank customers in making an informed decision regarding the least expensive charging method for them, the Supervisor of Banks has placed a track calculator on the Bank of Israel’s website, which will enable them to examine what the most appropriate charging method for them is—the basic track, the expanded track, or not joining a track, which means charging according to the method they have had until now—payment for each activity.
 
How the calculator works: The calculator is based on the number of activities executed by the customer in a month, and on the price of the tracks at the various banks. (Further explanation on the calculator is attached in Appendix B.)  A customer who does not know how many activities he or she executes in a month, whether teller-executed or customer-executed, can review his or her bank statements, or obtain this information directly from the bank via each bank’s call center (the numbers appear in Appendix C below).
 
Supervisor of Banks David Zaken said: “The purpose of this measure is to increase the transparency of the costs of managing a current account at the banks, to improve the ability of the banks’ customers to compare prices, and to encourage competition in the area of bank fees in order to reduce costs.  We recommend that fee-paying customers positively consider joining one of the tracks, in accordance with their activity profile in the account, since they represent a considerable reduction in the cost of managing a current account for households and small businesses.  In addition, we invite the public to examine and compare the terms offered at the bank where their account is managed and at different banks by using the tools available to it.”
 
The publication of this comparative information, and the publication of the calculator on the Bank of Israel site, will assist bank customers in comparing the actual costs of managing their current accounts against managing a current account on the basic or expanded track, to choose the track that is most appropriate for them and, at the end of the day, to save on the costs of managing a bank account.  By way of the calculator, the customer can immediately see what the costs of managing his or her account are at each of the other banks.  The link to the calculator (Hebrew) on the Bank of Israel’s website is: Calculator.
 
It is important to note that every customer can move from one charging method to another by giving advance notice to the bank.  The change in the charging method will take effect on the first of the month following the date notice is given to the bank (meaning that if someone joins a track during April, it will take effect on May 1st.)  The charge for the track will be made on a monthly basis, at the beginning of each month, for the month preceding it.  Furthermore, it is possible to join the tracks by calling the call centers of the various banks, by sending a fax, or at the bank branches.
 
An additional measure that takes effect today is the reduction in the minimum cost of managing an account from the total cost of two teller-executed activities to just one teller-executed activity.  As a result, customers who execute few activities in the account (just one teller-executed activity or about 3 customer-executed activities) will, as of today, pay half of the fees they were paying until now.

Appendix A – Common services in the current account that will be included in the tracks method
 
Teller-executed activity—activities done by a bank teller, including by way of a manned call center:
·         Depositing cash
·         Withdrawing cash
·         Printing and providing an account statement at the customer’s request
·         Transfer or deposit into a different account
·         Redeeming a check (including withdrawal by self-addressed check)
·         Depositing a check (for each group of up to 20 checks)
·         Payment of a coupon
·         Obtaining change for cash
 
Customer-executed activity—the following activities:
·         Crediting an account via a clearinghouse
·         Charging a credit card
·         Depositing cash
·         Withdrawing cash via an ATM machine
·         Transfer or deposit into a different account
·         Payment of a coupon
·         Information query on any issue (from the seventh query per month)
·         Withdrawing a check
·         Depositing a check (for each group of up to 20 checks), including by way of the service box
·         Standing bank order or authorized debit
 
Appendix B – The tracks calculator on the Bank of Israel website

Calc11.PNG
Calc22.PNG
Example of use of the calculator

 A customer executes 15 customer-executed activities each month, with no teller-executed activities.
 
At Union Bank, this customer would pay NIS 43.50 if he doesn’t join any track; NIS 24.50 if he joins the basic track; and NIS 24 if he joins the expanded track.
In other words, in such a case, the lowest cost would be obtained if he joins the expanded track.
 
In contrast, the same customer at Bank Leumi would pay NIS 24.80 if he doesn’t belong to any track; NIS 18.30 if he belongs to the basic track, and NIS 20 if he belongs to the expanded track. 
In other words, in this case, the lowest cost would be obtained if he joins the basic track.
 
Conclusion:  Executing customer-executed activities beyond the activities included in the basic track does not necessarily mean that the basic track is not worthwhile.  Each case must be assessed on its own, in accordance with the composition of activities executed by the customer during the month, and in accordance with the bank to which that customer belongs.
 
Appendix C – Phone numbers of the information call centers at the various banks:

Bank
Hours of operation
Phone number
Union Bank
Mon-Thurs: 7:00 am – 11:00 pm
Friday 7:00 am – 2:00 pm
03-795-3091
Otzar Hahayal
Mon-Thurs: 7:15 am – 10:00 pm
Friday 7:15 am – 2:00 pm
03-513-0606
Discount
Mon-Thurs: 7:00 am – 11:00 pm
Friday 7:00 am – 2:00 pm
*6111
First International
Mon-Thurs: 7:15 am – 10:00 pm
Friday 7:15 am – 2:00 pm
03-513-0604
Hapoalim
Mon-Thurs: 7:00 am – 10:00 pm
Friday 7:00 am – 2:00 pm
*2407
03-653-2407
Yahav
Mon-Thurs: 8:00 am – 7:00 pm
Friday 8:00 am – 12:30 pm
*2616
Bank of Jerusalem
Mon-Thurs: 8:00 am – 9:00 pm
Friday 8:00 am – 1:00 pm
*5727
Leumi
Mon-Thurs: 6:00 am –midnight
Friday 6:00 am – 2:00 pm
*53245; *5522
03-954-4555
Mizrachi Tefahot
Mon-Thurs: 7:00 am – midnight
Friday 7:00 am – 2:00 pm
*8860
Masad
Mon-Thurs: 7:15 am – 10:00 pm
Friday 7:15 am – 2:00 pm
*2448
03-513-0607
Mercantile Discount
Mon-Thurs: 7:00 am – 11:00 pm
Friday 7:00 am – 2:00 pm
*3477
Arab Israeli Bank
Mon-Thurs: 8:00 am – 4:00 pm
Friday 8:00 am – 1:00 pm
*3400
03-954-4258
Poalei Agudat Yisrael
Mon-Thurs: 7:15 am – 10:00 pm
Friday 7:15 am – 2:00 pm
03-513-0605