On March 23, 2022, the Bank of Israel published a call for public consultation on the technological specification of a digital format for checks.[1]  This notice announces an extension of the deadline for submitting comments as part of the consultation until July 15, 2022.


Checks are an integral part of the Israeli economy.  In 2021, check payments totaled NIS 812 billion, compared with payments of NIS 382 billion using payment cards.  Of that amount, more than NIS 120 billion were part of the check truncation industry, which supplies credit to small businesses among other things.


The Bank of Israel is examining an outline that is aimed at maintaining the positive qualities of existing checks and improving elements that need to be addressed.  The main qualities that have been found to be worth maintaining are: credit outside of a credit facility, provided in the form of post-dated checks, which serve both consumers and businesses; the ability to endorse a check for different needs, including credit in the form of truncated checks; a legal status that provides consumer protection and the ability to act in a shortened Enforcement and Collection proceeding; and more.  The main improvements that are necessary are: reducing, to the point of eliminating, the phenomenon of bounced checks for technical reasons such as a mismatched signature, an error in the date, and so forth; a more convenient alternative than dealing with paper and requiring the physical presentation of a check; reducing the number of days until settlement; documentation during the transfer, endorsement, and deposit; warnings prior to actual payment in order to allow for proper financial preparation; and more.  This outline is in addition to the reform already instituted by the Bank of Israel allowing for the deposit of checks by scanning them in using a cellular application.[2]


The Bank of Israel attributes great importance to directly interfacing with, and discussing with, many participants in the payments field, which will enable a greater understanding of the market’s needs and allow for greater attention to technological developments and opportunities in this field.  As such, on June 20, 2022, the Bank of Israel held a wide-ranging conference that enabled a “peek into the future world of payments”[3], which featured the participation of numerous financial and nonfinancial actors.  The subject of this public consultation was among the topics presented at the conference.  Entities that have not yet submitted comments regarding a technological solution and architecture for digital debit instructions based on the requirements and conditions that appear in the public consultation document are invited to do so, and those that have already submitted comments may edit or change those comments.


Director of the Payment and Settlement Systems Department Oded Salomy said, “The importance of developing a digital check that will provide a response to many existing needs in the Israeli payments market and will enable us to use new and advanced means of payment has generated a wide variety of comments from the financial system, government offices, the payments industry, fintech firms, and private individuals.  The comments all emphasize the importance that the Bank of Israel attributes to conducting an open dialogue with industry, government, the market, and the community in order to move forward together and remove barriers, while also maintaining stability and managing risks in order to move the world of payments forward to the advantage of the Israeli public.  We call on the public to take part in this groundbreaking process.”


Comments will be accepted until July 15, 2022.


To view the public consultation on the Bank of Israel’s website.

[1] Details of the public consultation as published on March 23, 2022.

[2] The Electronic Check Settlement Law.

[3] The Bank of Israel’s Future Payments Conference.​