Incremental measure opening Israeli payment systems to non-bank entities

 

Incremental measure opening Israeli payment systems to non-bank entities 

The Bank of Israel and the Capital Market, Insurance and Savings Authority (CMISA) have agreed on a framework in which financial service providers that are supervised by the CMISA will be able to connect to designated payment systems in Israel.

This incremental measure enables non-bank entities to enter the Israeli payments landscape, thereby increasing innovation and competition.

The framework will apply to financial asset service providers and deposit and credit unions supervised by the CMISA. In addition to satisfying existing license conditions, requirements specific to operations in payment services will apply, as formulated by the CMISA.  This process may also be expanded to apply to other types of licenses issued by the CMISA.

Dr. Moshe Bareket, Head of the Capital Market, Insurance and Savings Authority, said: “I am pleased with the cooperation with the Bank of Israel on this matter.  This is an important step that will enable players in the non-bank market to operate more effectively in the payments landscape, which will lead to an increase in competition in financial services provided to the Israeli consumer.”

Oded Salomy, Head of the Bank of Israel Payment Systems and Settlement Department, said: “Multiple domestic and international players have expressed an interest in operating in the Israel market, but await a framework for obtaining a license that will enable them to connect to local payment systems.  Unfortunately, legislation for regulating payment service operations has been delayed.  We have therefore taken action to create a solution that will make it possible for non-bank players to offer advanced payment solutions and value-added offerings to the Israeli public, while maintaining the stability of payment systems, similar to developments in the most advanced economies in the payments sector.  This measure will enable consumers and businesses to benefit from additional​ 
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