The Bank of Israel’s Supervisor of Banks on Wednesday laid out steps that would allow customers to open bank accounts via the Internet instead of having to show up at a particular branch.
To verify the identity of the person wanting to open the account, the bank would accept electronic copies of two identifying documents and conduct a recorded video interview.
Bank accounts opened online would have limits, however, to reduce the risks of money laundering and financing terrorism. Cash transactions would be capped at NIS 10,000 and it would forbid the end of the day balance to exceed NIS 300,000. Those restrictions would be lifted once the customer makes an in-person visit to the bank.
“Allowing the opening of accounts on the Internet will be a significant step in easing the move from one bank to another, and in increasing the competitive ability of the retail customer, households or small businesses,” Banks Supervisor David Zaken said.
The reform, which is to be finalized after following a comment period by other government bodies, is one in a series of steps the central bank is taking to increase competition in Israel’s banking system.
As of April 1, all banks are required to provide simple checking accounts, that let customers perform 10 transactions on their own plus one teller-executed activity per month for a maximum fee of NIS 10.
It requires an expanded track, which includes 50 transactions by the customer and 10 by the teller, which generally costs between NIS 20 and NIS 30 a month.
Zaken announced on Wednesday his intention to amend rules affecting credit card fees, both for businesses and customers.
For credit card holders, the rules would cancel fees for “delayed payment” imposed on each transaction, and consolidate foreign-exchange fees, ensuring that they are based on the representative exchange rate.
On the business side, the reform would consolidate fees that credit card settlement companies impose on companies, creating instead a uniform schedule that is more transparent, simple and easy to compare with competitors.
The proposal would eliminate fees imposed on businesses for registering and joining a settlement company, managing their account or changing a bank account to credit.
Both the Internet banking and fee consolidation reforms follow the recommendations of a policy committee titled the Team to Assess Increasing Competitiveness in the Banking System.