Periodic report on the prices of common banking services for households in 2020


Today the Banking Supervision Department published its periodic report on the prices of common banking services for households. The current report surveys developments in 2020 against the background of the COVID-19 crisis that broke out in March 2020 and impacted on the consumption of banking services.


Supervisor of Banks Mr. Yair Avidan said, “The goal of the report is to provide the public with information that will help it to understand the costs inherent in managing a bank account and to fund the steps it takes. I again urge the public to use direct channels and digital means and to understand its rights, thus saving costs. I note that as part of this, the Banking Supervision Department looks out, through a variety of means, for population groups that may find difficulty in operating such direct channels, in order to maintain a high level of service for them as well. In addition, in these days in which the COVID-19 crisis is still at a peak, I call on the banking system to show particular sensitivity, especially in dealing with consumer issues that are at the heart of the public’s feelings.”


Following are the main points that arise from the report:


​​·    In 2020, there was a continued downward trend in the ratio of income from fees to total assets of the banking system, from 0.92 percent to 0.76 percent. This trend of decline began after 2008. To date, there has been a cumulative decline of about 45 percent, which is attributed to the cumulative range of activities by the Banking Supervision Department and the banking system during that period. The decline in 2020 continued this trend but also was impacted to a great extent by the COVID-19 crisis that the economy faced in that period, and does not reflect the regular course of business.

·     During the period covered by this report, the COVID-19 crisis occurred, leading to a marked change in the public’s routine. This period was characterized by high uncertainty, which impacted on the public’s banking activity, as reflected in the report’s findings.

·     In 2020, the average cost of managing a current account and of holding a payment card in the account was NIS 22.4 per month, a decline of 17 percent relative to the average cost at the end of 2019. This cost is made up of:

o   The cost of current-account activity totaled NIS 11.3, a decline of 8 percent in 2020. The trend of decline in the cost of managing an account strengthened due to the crisis and the decline in economic activity.

o   The cost of credit cards was NIS 11.1, a decline of 24 percent in 2020. The decline derived from a decrease in income from transaction fees and foreign currency withdrawals due to the decrease in the scope of activity due to the crisis. In contrast, there was an increase in the cost of card fees collected—the average card fee was NIS 6.9 per month, compared to NIS 6.5 in 2019. The increase derived from among other things, the ending, for many customers, of the card fee exemption period that was granted to them as a benefit for joining when the credit card was issued.

·     In September 2020, a Supervisory Order on prices was published, with the goal of making things easier for customers in dealing with the coronavirus crisis and to encourage them to avoid going into branches during the crisis period and to carry out banking activities remotely. The Order reduced the following fees: debit card fee; a warning letter from a lawyer; and an activity carried out by a clerk at a phone call center. The Order was in effect for 6 months, until April 13, 2021.

·     In 2020, a decline was seen in securities management fees collected in actuality from the banking system, with an average range of 5–10 percent, depending on the portfolio value. Despite the above noted decline, there was an increase in total banking system revenues from securities fees. This derived from growth in the quantity of securities transactions against the background of the COVID-19 crisis.