The Parliamentary Inquiry Committee on bank fees recommended in its final report released on Tuesday that the Bank of Israel create a benchmark to measure bank fees as well as order the country's largest banks to reduce fees for individuals and small businesses.
The committee, chaired by MK Moshe Kahlon, noted in its report that the Supervisor of Banks at the Bank of Israel would publish the benchmark on a quarterly basis in order to allow customers to make informed decisions about their banking needs as well as increase competition between the banks in the household sector.
In a speech to the inquiry committee earlier this month, Bank of Israel Governor Stanley Fischer said that the reason for the low competition in Israel's banking sector was that a limited number of banks captured the market, making it very difficult for smaller banks to expand their customer base and almost impossible for foreign banks to break into the household sector.
The committee's report also stated that the Bank of Israel should consider banning fees on exchange rate-related transactions such as deposits, loans and currency conversions, and it instituted mechanisms to facilitate the account transfers between banks. In addition, the panel recommended a publicity campaign to inform the public of the new standards.
The committee also suggested that the Postal Bank be converted into a proper bank, and that banks be forced to sever ownership relations with credit card companies.
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