An organizational culture that champions fairness toward the customer is the basis for providing fair and high-quality service to the customers of the Israeli banking system.  This lies at the core of relations between the banking corporations and their customers, and is the focus of the Banking Supervision Department’s efforts.  The survey now being published emphasizes the promotion of a culture of fairness in the banking system.


Supervisor of Banks Yaron Avidan said, “The Banking Supervision Department expects every banking corporation to promote and inculcate the value of fairness, with the concept of putting the customer first.  The supervisory expectation is that beyond compliance with consumer regulations, the banking corporation will instill values that promote a culture of fairness toward its customers, and views high-quality service as a central component in fair behavior.  We see a direct connection between fairness and the public’s trust in the banking system, as well as a direct connection between the public’s trust and the stability of the banking system.”


One of the tools the Banking Supervision Department uses to advance fairness in the banks’ relations with their customers is the handling of public complaints, initially by the ombudsmen at the banking corporations, and then by the Banking Supervision Department.  This format includes the resolution of disputes, both from the customer’s standpoint and from a broad view, and identifying and correcting deficiencies both in relations with the customers and within the banking system in general.


Main data from the 2020 survey and a look forward to 2021


1.      The handling of individual complaints through the Banking Supervision Department’s Public Enquiries Unit


In 2020, the Unit handled about 10,500 requests for information and complaints—the highest total in the past five years.  The increase was partly due to the COVID-19 crisis and its impact on the public.[1]


To make sure that customers of the Israeli banking system receive proper and fair banking service, the scope for examining public complaints was expanded in terms of how complaints are classified, the banking corporation’s responsibility, remedies available to the customer, and more.  This was reflected, in part, in the following figures:

·         About 24 percent of complaints in 2020 were justified.

·         As part of the handling of complaints, a total of about NIS 6.1 million was returned to the public in 2020. In about 30 percent of complaints that were dealt with by the Unit, the appellant received redress such as monetary remedy, waiver of a debt, fulfillment of a request, return of the situation to its previous state, compensation, and more.


In this activity, special emphasis was placed on the following principles, as these are at the forefront of banking fairness: banking for every person, protection of specialized population groups, equality in the provision of banking services, fairness in advertising and marketing, effective and transparent disclosure, professional and available service, maintaining information privacy, protection against fraud, responsible business behavior, and more.


The survey also describes cases in which the Banking Supervision Department found place to grant regulatory praise to the banking corporations’ handling of public complaints, and views such activity as meeting the high standard of fairness.


2.      Handling of broad deficiencies by the Banking Supervision Department’s Public Enquiries Unit


During the reviewed period, the Banking Supervision Department significantly expanded its activity to find and correct broad deficiencies in the banking system that were identified during the handling of public complaints or through initiated enforcement examinations.  The Department instructed the banking corporations at which the deficiencies were found to return money to customer groups from which money had been collected unlawfully.  An estimated total of about NIS 14.7 million was returned to customers as part of this activity.  The deficiencies were found in a variety of areas, such as fee collection, computer systems, the banking control environment, and more.


In recent years, the Banking Supervision Department has increased the use of the administrative enforcement mechanism of imposing monetary sanctions, with the view that this mechanism is appropriate for handling significant and clear breaches of consumer regulation directives in the banking system.  During the reviewed period, 3 monetary sanctions were imposed, totaling more than NIS 2 million, in respect of breaches of consumer directives regarding end of associations, fee collections, and charging a payment card for a cancelled transaction.


3.      Handling of public complaints through the banking corporations’ ombudsmen


The banking corporations allocate many resources to handling complaints from their customers, including through ombudsmen.  In 2020, the ombudsmen in the entire banking system handled about 35,700 complaints and about 13,300 various requests.

·         About 75 percent of customers who contacted the banking corporations’ ombudsmen received a response within 30 days.

·         About 25 percent of customers who contacted the banking corporations’ ombudsmen received redress due to their enquiry.

·         About NIS 7.6 million were returned to the public as part of the handling of complaints and requests.


This survey publishes three main indices to evaluate the quality of treatment of public complaints at the five large banks.  The following are the banks that were ranked first in each index:


1.      The ratio between each bank’s share of complaints and requests handled by the Banking Supervision Department and its share of the banking system: Bank Mizrahi-Tefahot was ranked first in this index.  Its share of complaints and requests handled by the Public Enquiries Unit is the smallest relative to its share of the banking system, for the fourth consecutive year.

2.      Justified complaints as a share of complaints that were decided upon: Bank Mizrahi-Tefahot was found to be the best bank in this index.

3.      The rate of cases in which the bank acted in favor of the customer even though the complaint was not found to be justified: Bank Leumi was found to be the best bank in this index.

The Public Enquiries Unit in the Banking Supervision Department is available to the public on any matter concerning the public’s affairs with the banks and credit card companies. To obtain information or submit complaints on banking consumer matters, please contact the Unit through the following means: - Online form on the Bank of Israel’s website: - Telephone call center: 02-655-2680

[1] The measures taken by the Banking Supervision Department to support economic activity and assist customers were detailed in the Public Enquiries Unit Survey for 2019 and Outlook for 2020, which was devoted to the COVID-19 crisis, and are discussed further in Appendix C of the current review, which details the directives and legislative items that were published in 2020.