Israeli Shoppers May See Lower Prices on Shein and Temu

By מערכת ice

Translated & summarized from Ice by baba

BusinessNeutral tone

Hebrew · 6 newsrooms covering

Canadian fintech Nuvei received a payment clearing license in Israel, potentially lowering costs for e-commerce sites like Shein and Temu. This could lead to reduced prices or better benefits for Israeli shoppers. The move may also improve credit card transaction success rates. The actual impact on consumer prices depends on whether the companies decide to pass on the savings.

The story in 5 lines · by baba

Nuvei's new Israeli payment license could lower costs for Shein and Temu shoppers.
The license allows local shekel processing, reducing cross-border transaction fees.
Yuval Ziv suggested savings might translate to lower prices or better benefits for consumers.
AliExpress is not affected as it uses a different payment system.
The full impact on prices depends on whether companies pass savings to customers.

Israeli Shoppers May See Lower Prices on Shein and Temu — Editorial illustration generated by baba News, not a photograph of the event.

Israeli consumers who frequently shop on international e-commerce sites like Shein and Temu may soon benefit from changes in payment processing. The Canadian fintech company Nuvei has received a clearing license from the Israel Securities Authority, enabling it to expand its operations in the country. This license allows Nuvei to use Israel's domestic payment infrastructure to process transactions from local customers, a move that could reduce costs for both the e-commerce platforms and potentially consumers.

Previously, purchases from international sites were treated as cross-border transactions, often incurring higher processing fees. By enabling local clearing in Israeli shekels, Nuvei can connect to the Bank Settlement System (BSS), which facilitates communication within the payment market. This is expected to lower operational expenses for companies like Shein and Temu.

Beyond cost savings, the shift could also improve the usability of Israeli credit cards for international purchases, reducing instances of declined payments due to suspected unusual activity. Yuval Ziv, President of Nuvei, suggested that these cost reductions might be passed on to consumers in the form of more attractive prices, discounts, or shipping benefits, although Shein and Temu have not yet officially announced any price changes.

AliExpress is not expected to be affected by this development, as it operates through a different payment system linked to Alibaba. Nuvei has a significant presence in Israel, employing around 350 people in its Tel Aviv center and having made several acquisitions, including SafeCharge for approximately $890 million in 2019 and Simplex for about $250 million in 2021. The company is also in the process of acquiring Israeli fintech firm Pioneer for $2.75 billion.

The practical implications for Israeli shoppers remain uncertain until the companies decide to pass on any savings. While the new license creates an opportunity for reduced costs, consumers will only see a tangible difference if these savings are reflected in prices or benefits.