Israeli Shoppers to Benefit from Lower Fees on Shein, Temu
Translated & summarized from Mako by baba
Fintech company Novi has received a license in Israel to process payments directly, making online shopping on sites like Shein and Temu cheaper for Israelis. This eliminates foreign currency conversion fees and reduces transaction declines, as purchases will be treated as local shekel transactions. The savings are expected to lead to better deals and discounts for Israeli consumers, while also increasing competition in the local payment processing market.
The story in 6 lines · by baba
- Novi's new license allows Shein and Temu to process payments directly in Israel, reducing costs for shoppers.
- Israeli consumers will no longer face hidden foreign currency conversion fees on these platforms.
- The change means the price displayed in shekels will be the final amount charged to the customer.
- More Israelis with basic credit cards will now be able to shop on international sites like Shein and Temu.
- Retailers' savings are expected to result in more discounts and promotions for Israeli shoppers.
- The move introduces significant international competition to Israel's payment processing industry.
Israeli consumers are set to experience more affordable online shopping from international retailers like Shein and Temu, following a significant regulatory approval for fintech giant Novi. Novi has received a license from Israel's Securities Authority to operate as a regulated payment acquirer, enabling it to connect directly to Israel's national payment infrastructure, Sheva.
This new license eliminates the need for complex international financial intermediaries, which previously led to hidden fees such as foreign currency conversion charges and higher exchange rates for Israeli shoppers. By processing transactions directly within Israel's payment system, Shein and Temu will now be able to charge Israeli customers in shekels, treating them as local transactions. This means the price displayed in shekels will be the exact amount debited from the customer's account, removing the surprise fees that often appeared on monthly credit card statements.
Furthermore, the change is expected to broaden access to these platforms for a wider range of Israeli consumers. Previously, individuals with basic debit cards or certain types of credit cards not enabled for international purchases faced difficulties completing transactions on these sites. The direct integration into the Israeli payment system will now legitimize all Israeli credit cards on these platforms, reducing transaction declines often caused by banks flagging overseas purchases as suspicious.
While the direct cost of goods may not immediately decrease, the savings in transaction fees for retailers like Shein and Temu are substantial. Industry experts anticipate these savings will translate into benefits for consumers, such as lower thresholds for free shipping, more aggressive coupon offers, and deeper basket discounts. This development also introduces significant competition into Israel's payment processing market, which has historically been dominated by a few local credit card companies, with Novi, a major player in global finance, now establishing a strong presence in Israel.
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