The Banking Supervision Department announces further measures to benefit households, in the area of fees and fairness in debt collection
The Banking Supervision Department is holding a professional conference today, entitled “The Customer at the Center”.
The Banking Supervision Department announces further measures in the area of fees, with the aim of ensuring that bank customers will also benefit from the savings created as a result of streamlining at banks, and from the transition to direct banking.
The Banking Supervision Department will soon publish a directive that will lead to increased transparency and fairness, and to increased control, concerning how household and small business debts are collected by the banks.
Supervisor of Banks Dr. Hedva Ber said, “We are acting to ensure that bank customers will also benefit from the savings generated for banks as a result of the streamlining measures we are leading in the banking system. The banks are reducing their workforce, and some are reducing the number of branches, while customers are executing more transactions through direct means such as the Internet, mobile applications and ATMs. The measures we are announcing today, in the area of fees, will help ensure that the savings generated for the banks as a result of the streamlining will also reach the customers.”
Deputy Supervisor of Banks Ms. Odeda Perez said, “The directive regarding debt collections is one of the most important consumer directives we have issued in recent years, and it will ensure that the debt collection process concerning a customer who is encountering difficulties and not fulfilling the agreement will be fair. The directive’s point of departure is that debts must be repaid. At the same time, we expect the banking corporation to act fairly toward the customer at every stage of the relationship with the bank, even when that relationship becomes rocky. The directive is the product of an in-depth examination of the matter conducted by a joint team from the Bank of Israel, the banking system, and the Enforcement and Collection Authority, and we believe that it provides a response to the issues raised by all of these parties, and that the situation for customers encountering repayment difficulties will improve.”
The measures carried out by the Banking Supervision Department in the past year to increase fairness and trust in the banking system and to advance competition were presented at the conference. A number of banks presented the tools they are currently offering to households and small businesses. The conference also featured a panel of ombudsmen from the banks, led by the Head of the Public Enquiries Unit in the Banking Supervision Department, Ms. Einav Hecht Amir, which discussed the question of “What are bank customers complaining about,” and how the complaints are handled by the banks and by the Banking Supervision department. Adv. Sylvia Segal of the “Emun Hatzibur” organization also participated in the panel.
Supervisor of Banks Dr. Hedva Ber emphasized the fact that the link connecting the banking system with households and small businesses has become more intensive in recent years, and that the banks have increased activity with households at the expense of a decline in activity with large borrowers. The Supervisor enumerated the central measures advanced by the Banking Supervision Department in the past year to benefit households, including: reducing fees for senior citizens and those with disabilities, making it easier for young people to purchase homes in “Buyer’s Price” projects, the website launched to enable households to find “lost” dormant deposits, and actions undertaken by the Department and led by the banks and the association of banks to increase financial awareness. Alongside these, the Supervisor presented all the structural measures taken by the Bank of Israel to increase competition in the banking field.
The Supervisor of Banks said, “At the Banking Supervision Department, we are attentive to public criticism on issues in the banking field, and we are acting to correct what must be corrected. In recent years, the banks have become more attentive to the broad public, due among other things to the social protest and the regulatory requirements we have imposed.”
In terms of the new fee measures declared at the conference, the Supervisor noted: “Our requirement of the banks today is that every transaction executed by a customer will be executed through direct means, such as the Internet, a mobile application, or an automatic machine, that it be less expensive than a transaction executed in the branch, and obviously that this is disclosed in the fee schedule. In addition, and against the background of the trend where some banks are closing branches, we have decided to instruct that cash withdrawals by a customer from an ATM belonging to the bank where that customer manages his account shall be considered a customer-executed transaction (with a lower fee) even if the ATM is at a location other than the branch. In addition, in view of the law authorizing the Banking Supervision Department to approve the closure of branches, when issuing approvals, we will examine whether it is necessary to leave a cash withdrawal machine nearby, for a defined period and at a low cost, for the customers of all banks.”
In terms of the initiative to increase financial awareness, the Supervisor’s Chief of Staff, Ms. Tal Harel Matityahu, presented the activities advanced by the Department in conjunction with the banks and the Association of Banks, which have taken place in about 100 branches throughout the country. She noted that, “one of the ways to help the public manage accounts in a balanced and informed manner and make decisions that will lead to lower account management costs is to increase financial awareness. This year the Banking Supervision Department, together with the banks and the Association of Banks, took significant actions in this important area as well.”
Participants in the conference other than representatives of the banking system included Dr. Kira Radinsky, a computer scientist and hi-tech entrepreneur who specializes in data mining. She presented the issue of forecasting events in various areas, with an emphasis on big data, and the possibility of using that information to benefit the customer. Another participant was Mr. Doron Shnidman, owner of the Bituach Yashir insurance and finance company, who presented how a nonbank corporation operates in the credit field and its contribution to increased competition and to the improved state of retail customers.