Israeli Retail Investors Prefer Investment Apps Over Banks Amid Market Boom
The past year marked a record high for the Tel Aviv Stock Exchange, driven largely by private retail investors who injected a net 13.7 billion shekels into the stock market, surpassing institutional and foreign investments combined. Many of these investors, particularly young adults in their 20s and 30s, conducted their trades through investment houses and banks using trading accounts. According to Meitav Investment House, Israel has over 1.6 million securities trading accounts, with approximately 200,000 new retail accounts opened in 2025 alone.
Competition for these investors is fierce among fewer than 20 licensed trading entities, including five investment houses (Excellence, Psagot, Altshuler, Meitav, and IBI), ten banks, and an independent firm, Blink. Traditionally dominated by banks, the market has seen a significant shift: while banks opened 94% of new accounts six years ago, this dropped to 53% in 2024, with investment houses capturing half the market share. This shift is attributed to investment houses offering lower trading fees and management costs, sometimes up to 0.5% cheaper than banks, amounting to billions in savings for investors.
Meitav Trade leads the market with 125,500 accounts, followed by Excellence with 90,000, and IBI with 82,000 accounts, reflecting the growing dominance of investment houses. Meitav nearly doubled its trading accounts in under four years, while IBI tripled its accounts in less than three years, with expectations to surpass 150,000 clients by mid-2028. Altshuler Shaham recently entered the market with its ALTrade platform, joining Blink and Interactive Israel, which mainly target younger investors but currently rank lower due to limited local securities trading options.
In response, banks have launched aggressive campaigns to regain market share. Bank Hapoalim offered over a million customers shares of the bank, with two-thirds opting for shares instead of cash, and provided fee rebates up to 2,000 shekels for young investors aged 18-35. Bank Leumi similarly promoted its digital platform Pepper with incentives and a "No Profit, No Fee" campaign featuring celebrities like Omer Adam and Gal Toren. Despite these efforts, banks like Discount and International Bank rank low in customer preference, indicating ongoing challenges in attracting young retail investors.
Overall, the Israeli stock trading landscape is rapidly evolving, with investment houses increasingly preferred by retail investors due to better pricing and user-friendly platforms, while banks intensify efforts to retain their clientele amid fierce competition.
