The Banking Supervision Department publishes leniencies in bank account management requirements for nonbank credit providers and credit intermediation system (P2P) operators

Supervisor of Banks Dr. Hedva Ber said, “The amendment that we published today will markedly ease the ongoing activity of financial entities that received a license for extending credit or operating a credit intermediation system from the Capital Market, Insurance, and Savings Authority. The banking system is required to provide service to these entities, without compromising on compliance with AML directives.”


 The structural changes occurring in the financial industry in Israel and the technological changes impacting on the financial world have led to an increase in the number of entities competing with banks to provide credit and for other financial activities. These entities require services from the banking system, and in particular, they need to maintain a bank account in order to carry out financial transactions vis-à-vis their customers. The result is that those entities maintain bank accounts, and part of the money in the accounts is essentially not money of those entities themselves, but of their customers. This fact presents the banking system with difficulty in terms of complying with the Anti-Money Laundering Law.

 In accordance with the Prohibition on Money Laundering (The Banking Corporations’ Requirements regarding Identification, Reporting, and Record-Keeping for the Prevention of Money Laundering and the Financing of Terrorism) Order, 5761–2001, bank customers (in this case the customers are the credit-providing entities and the P2P entities) are required to declare if they act in their accounts on another’s behalf, and in a case where the customers are corporations, to declare their controlling interests. These declarations are required when opening a bank account, when changing ownership of an account (adding or removing an account-holder), when executing a transaction above a certain threshold, etc.

 Main points of the process:

With the goal of making it easier for nonbank credit providers and P2P entities to manage bank accounts, the Banking Supervision Department today is publishing leniencies with regard to the obligation imposed on banks to register beneficiaries and holders of control in accounts of credit service providers and credit intermediation platforms. It should be emphasized that the easings will apply to accounts of entities supervised by the Capital Market, Insurance, and Savings Authority and that received from it a license for extending credit or for operating a credit intermediation system.

The easing published by the Banking Supervision Department means that nonbank credit providers and P2P entities will not be required to provide those declarations to banks, as they are entities supervised by the Capital Market Authority, that are required to implement the provisions of the Prohibition on Money Laundering Law, 5760–2000. The easing removes a formidable barrier that currently weighs on such entities’ operating in the Israeli financial system and competing with the banking system.​