JERUSALEM (Reuters) – Israel’s banking watchdog on Sunday approved conditional and controlling licenses for a group of entrepreneurs to set up a new online bank, the first of three years in a highly concentrated banking sector. Added for the second time.
Bank of Israel said its banking regulator had completed inspections of the new institution, called Esh Bank Israel.
It stated that these approvals will allow the founders to move forward and complete the mechanical, operational and regulatory preparations required for the commencement of banking activities.
These include completing the development and testing phase of the new technology and hiring the management team and bank staff.
The central bank says it will take about a year and a half to get banks up and running.
“We still have a long way to go,” said Shmuel Hauser, chairman of Esh, adding that the bank will offer attractive interest rates and commission-free banking services.
Last January, One Zero Digital Bank received final regulatory approval for a full banking license, becoming the first new Israeli bank in years.
Israel’s banking system is highly centralized, run by a handful of banks, the two largest of which control more than half of the industry’s assets.
“We consider it important that banks and other new players enter the Israeli banking system, so they help increase competition and innovation in the financial system,” Bank of Israel Governor Amir Yaron said.