Israel's Central Bank Delays Shift to Digital Bank Notifications Amid Knesset Concerns

The Bank of Israel has extended the public comment period for a proposed directive that would allow banks to switch customers to digital notifications by default. The deadline for feedback is now November 30, 2026, and the directive will not take effect until after further discussion by the Knesset's Economic Committee. This decision follows a request from five Members of Knesset from both coalition and opposition parties, who argued that the directive's initial release on November 3, during a transition period for the Knesset, bypassed prior commitments to consult with the committee. The lawmakers accused the Bank of Israel of attempting to push the reform through without proper parliamentary oversight, undermining the Knesset's authority. The proposed directive would enable banks to automatically enroll customers in digital notifications without explicit consent. However, exceptions are planned for individuals aged 70 and older, and for those who have not used their bank's website or app in the past year. Customers would be notified before the switch and retain the option to revert to paper mail. The concerned MKs warned that this could disproportionately affect individuals with lower digital literacy, including the elderly and new immigrants, potentially causing them to miss critical alerts about overdrafts or unexpected charges, thereby losing control over their finances. They emphasized that even with exceptions, changing the default setting without explicit customer agreement is unacceptable. The MKs have called for an urgent discussion by the Economic Committee upon its formation, involving the Bank of Israel's Banking Supervision Department and relevant organizations. The push for digital notifications began four years ago, was paused due to the war, and resumed about 18 months ago. In January 2026, the Economic Committee tasked a group led by MK Uri Maklev to study the issue with the Bank of Israel. In May, this group concluded that customers should not be moved to digital notifications without explicit consent, and paper mail should remain the default. In July, then-committee chairman David Biton wrote to the Governor of the Bank of Israel, stating that the reform should not proceed in its current form. The Bank of Israel reportedly assured him it would not act without committee approval.