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Bank of Israel Governor Prof. Amir Yaron said: “Since the beginning of the Swords of Iron war, the Bank of Israel has taken a broad set of actions to support activity in the markets and to assist households and businesses.  The loan repayment deferral program, which was adopted by the banking system, is an important part of the this set of measures that the Bank of Israel has devised to help many households and businesses hurt by the events of October 7 and the resulting war.  The program enables them to create a cashflow bridge to help them get through this difficult period.  The program thereby helps the economy as a whole to better recover from the difficulties that have resulted from the war.  The Bank of Israel will continue to constantly monitor the state of the economy in view of the war, and will act as necessary to support the economy.  I thank the professional team at the Banking Supervision Department, which has led this significant step, and the banking system as a whole for joining the assistance efforts and extending the program once again.”


Supervisor of Banks Daniel Hahiashvili said: “The State of Israel is still dealing with the complex security situation.  As such, we decided to continue making things easier for customers and to extent the comprehensive program adopted by the banks, for a third time, in order to provide unique assistance to reserve soldiers.  The additional extension, which includes additional population groups among those who are eligible, is intended to assist those who still need an easier cash flow in order to successfully manage the effects of the war.  Since the cumulative deferral period may be relatively long, I call on the public to properly examine the need for deferring loan repayments, even if the deferrals do not include interest or fee charges, and to prepare for returning to a proper payment routine.  The Banking Supervision Department will continue to closely monitor the data and the enquiries coming from the field, and will act accordingly as necessary. I thank the banking system for its involvement in further expanding the program, and for providing additional assistance to its customers, beyond the uniform program.”


Background and data:


About a week after the outbreak of the war, the Bank of Israel announced a comprehensive program to ease the burden of credit and fees, which was adopted by the banks, with the aim of helping customers in dealing with the consequences of the war.  A few weeks after the war started, and in view of the fact that residents of the north were also evacuated from their homes, the program was expanded to include residents of the north.  In view of the continuation of the war, the Bank of Israel announced a further three-month extension of the program, which was adopted by the banks, and expanded the program to additional population groups.


As of January 31, 2024, payments on about 306,000 loans totaling about NIS 5.5 billion have been deferred.  Of those deferrals, about 40 percent are by households, most of which were for housing loans, with the remainder by the business sector (of which 40 percent for micro businesses, 21 percent for small businesses, and the rest for medium and large businesses).


From the publication of this notice until march 31, 2024, the population eligible for this program includes the following groups:


First-degree customers: People who live or own a business that is located within up to 30 km from the Gaza Strip; people evacuated from their homes by an official state agency as of November 7, 2023 and who live in one of the localities that appear on the lists published on the Bank of Israel website; people serving in the IDF reserves and those mobilized under emergency orders; accounts of people who are kidnapped or missing; people who are first-degree relatives (spouse, parent, sibling, child) or someone killed in the war or kidnapped or missing; victims from the Nova festival.


Second-degree customers: Everyone else.




The program enables first-degree customers to defer payments on loans and mortgages[1], to obtain an exemption from most fees, and to obtain an exemption from interest on negative balances up to predefined amounts in current account, for a period of 3 months from the date they join the program.


Other customers (“second-degree customers”) are given the option to defer loan and mortgage repayments for three months, with no fees, with the deferred payments bearing interest that is not to exceed the interest rate in the loan contract. 


Extension and expansion of the program:


In view of the continuation of the war and its consequences for customers’ financial conduct, and with a desire to provide special leniencies to reserve soldiers, the Bank of Israel announces a further expansion of the program, which has been adopted by all the banks, as follows:


  • Extending the existing program (as is) by an additional three months, from April 1, 2024, for both population groups – first-degree and second-degree customers, similar to the original terms of the program published on the Bank of Israel website.
  • Additional first-degree customers:
    • The accounts of residents from 8 localities in the north whom the government has decided to evacuate from their homes but who have not yet been evacuated.[2]
    • IDF reserve soldiers who have been hospitalized for a period of at least 7 days due to injuries sustained during the war.[3]
    • Accounts of those who participated in the “Psyduck” festival and those involved in the preparatory meeting for the “Midburn” festival.[4]


  • In reference to first-degree customers, the terms of the program will be expanded between April and June as follows:
    • Reserve soldiers will be exempt from interest on negative balances in their current accounts (provided the customer was in overdraft prior to the publication of the current program) for negative balances up to NIS 10,000, for a period of three months, in accordance with actual negative balances. The customer’s account must be identified as belonging to a reserve soldier based on the reserves grant being paid into the account in January 2024.
    • Benefits to reserve soldiers provided by the bank with no need for documentation – Benefits to which reserve soldiers are eligible based on the program (exemption from fees and absorption of interest on negative current account balances and in business accounts, in accordance with the terms of the program) will be initiated by the bank for a period of three months, similar to other population groups that could be identified without documentation. The customer’s account must be identified as belonging to a reserve soldier based on the reserves grant being paid into the account in January 2024.


The expansion of the program for an additional three-month period will come into force on April 1, 2024, and requests to be included in the additional program can be submitted between April 1, 2024 and June 30, 2024.


To be clear, before making a decision to defer payments, particularly for customers who have already deferred payments as part of the program, you should closely examine the need for a further deferral and its implications, including its overall economic price, in terms of the cumulative monthly charge following the deferral, the interest cost (for second-degree customers), and so forth.


To be clear, the program presents the minimum conditions, and each bank is permitted to expand it for its customers, as most of the banks have done.  The Banking Supervision Department encourages them to continue to do so.


[1] Mortgages to an unlimited amount; consumer credit – cumulative up to NIS 100,000; business credit up to NIS 2 million.

[2] The localities are: Abirim, Avadon, Alma, Kerem Ben Zimra, Alkosh, Fassuta, Hurfeish, and Reihanya.  These have been added to the list that appears on the Bank of Israel website.

[3] Subject to providing documentation from an authorized official source (IDF or hospital).

[4] Subject to providing the bank with documentation from the National Insurance Institute that the customer is recognized as a victim of terrorism.