Bank of Israel unveils final monthly-fee reform for checking accounts

The Bank of Israel published the final version of its bank-fee reform on Sunday, setting it to take effect on July 1, 2027. Instead of paying separately for each transaction, customers will move automatically to a monthly subscription-style model for basic checking-account services.

Under the new framework, each bank will charge up to 10 shekels a month for up to 100 basic banking actions, including salary deposits, transfers, standing orders and check deposits. Customers who make only two actions or fewer in a month will pay a reduced ceiling of 5 shekels. Any activity beyond the 100 included actions will cost up to 1 shekel per additional action. The Bank of Israel said banks will identify the number of transactions automatically, and no customer will need to sign up.

Bank Supervisor Dani Khachiasvili said the reform is meant to simplify the system, ease customers’ use of banking services, and improve competition and fairness. He said basic account management and payment tools should be available to everyone at a reasonable cost, and that the current variety of options creates confusion and makes comparison difficult. The regulator also said banks may offer optional bundled service packages that include products outside the basic basket, such as securities or foreign exchange, for one fixed monthly fee, a model used abroad but new in Israel.

The reform also caps debit-card fees at 7 shekels a month, replacing the current arrangement under which customers with both an credit card and debit card get a three-year exemption. That change will begin on October 1. The Bank of Israel says the current problem is not only price, but the need to register for the old package, which many eligible customers never did, even though it was worthwhile for 35% of accounts when launched in 2014 and only 24% joined by last year.

The central bank says small businesses, many regular private customers, and people who still bank through tellers are likely to save money. But Lobby 99 and the nonprofit Rav Nakhi argue that more than 60% of bank customers already pay less than 10 shekels a month, and warn that banks could turn the new cap into a flat fee, making the reform more expensive for many people.