Today, Prepaid Cards are an alternative to half a million people
in Israel who operate mainly on a cash basis.
Give them a platform to manage their money
outside the banking system.
The CBS survey published in 2018 shows that about 14% of households
do not have a bank account at all. More than 300,000 people in Israel
have a limited account. If with no choice, it is particularly high.
If we add to this about 200,000 foreign workers who are in Israel,
we will reach more than half a million people, many of whom receive
their salaries in cash or by check from the employer (whom they redeem for cash).
Officially, even a customer who is defined as "restricted" with a "problematic"
history in his financial conduct, can open a bank account. Banks must
not refuse to open an account (as long as there is no reasonable reason to refuse)
of course for consideration with restrictions such as:
Managing a credit balance - without granting credit and without
the possibility of overdraft. But in the practical test, the banks
are not happy to do so and the public's awareness
of their rights in this matter is low.
Another push in this area is the law restricting the use of cash
that came into force in early 2019. Although the restriction on
use applies to a high amount of NIS 11,000, the law is generally
intended to encourage the public to switch from cash
to means of tracking payments.
So what's the matter? The thing is that banks do not really like
it and the result is that almost none of them promotes non-bank
rechargeable debit cards. Banks and the Bank of Israel have
no interest in promoting the use of this card. Banks see this
as an alternative to the bank account. Unlike the debit
card - a debit card in which the transactions made are debited
immediately from the bank account and are not postponed
to a fixed debit date, in the debit cards charged the bank
account is irrelevant (it is not necessary) and has no connection to the card.
Today, tens of thousands of employees are limited in the bank,
and receive their salary by check or cash, mainly in the fields of
nursing, construction, restaurants, hotels, agriculture and more.
Anyone who wants to use the rechargeable card for online
shopping can also be added to this entire population.
"This is a population with a turnover of more than NIS 3.5 billion a month.
From the banking system's point of view, there is no reference
at all to these populations. They belong to someone who
has a bank account.What about the other populations? ..
So what does this card allow and for whom is it primarily
intended and how much does it cost? We checked
In recent years, a revolutionary solution has been gaining momentum
around the world, which serves as a substitute for cash and allows
anyone to manage their money in a simple and efficient way
(even if they do not have a bank account or credit card).
This solution includes the use of rechargeable debit cards
and a digital wallet. Today this product is used in almost
every home in Europe and the USA
International rechargeable debit cards are a benefit
and solution for many user groups:
1. Companies that make available to employees an expenditure
budget for use in Israel or abroad.
2. Israelis who do not have a bank account or have a restricted
bank account who can receive their salary directly to the card.
Teenagers who receive a periodic budget from their parents.
4. Students who study at a great distance from their parents' home
and are supported by the parents who support them financially.
5. Young people who travel the world and sometimes also need
immediate transfer of funds for unforeseen needs.
6. Israelis who travel the world and do not want to risk losing
or stealing their credit card.
Other population groups that do not have bank accounts,
including ultra-Orthodox, Israeli Arabs and more.
The prepaid card is pre-loaded with a sum of money - whether
it is a salary charged by the employer or a card intended for
shopping in Israel and abroad. These cards in the US and Europe
already constitute about 12% of the debit card market share
in general and are an alternative to credit cards for A significant
part of the population is still at the beginning of their journey here in Israel.
The corona crisis and its consequences, together with the law
reducing the use of cash, caused all Israelis to change their buying
habits. According to CBS data, in March-May 2021,
the volume of Israelis' purchases of credit cards was 16.5% larger than
in the corresponding period last year. More transactions take place
through clearing systems and less cash.This is the result of many
factors working together but the result is the same for everyone - the need
for debit cards in order to realize transactions.
Today there is a large variety of prepaid cards in Israel.
There are a number of companies offering rechargeable debit cards,
some issuing and some marketing. This market is undergoing rapid
growth and development processes, constantly being upgraded
and adding additional services and options to users.
The cards are loaded with a variable fee basket
from provider to provider
Issuance fees between NIS 35-50
Charging fees between 0.5-3%
Monthly management fee between 0-25 NIS
ATM withdrawal fee between 5-7 NIS
But these costs reflect the range of options that a provider
provides to the customer.
There are cards that come with a digital wallet, different
options and different restrictions from card to card.
Therefore, the customer has the option to choose which
of the cards provide him with the highest benefit for him
There are restrictions on the amount of deposit / withdrawal,
maximum balance and more. (Varies from card to card)
• For example, the maximum charging amount
for salary cards is around NIS 15,000-20,000.
• The amount of a single withdrawal is around NIS 500-1,500.
There are 2 very important parameters that a rechargeable
card gives to its owner:
Availability
Rechargeable prepaid cards are usually found at dozens of charging
stations scattered throughout the country. If you are interested in
purchasing such a card, make sure that there is a charging
station close to your home. At this charging station you can
recharge cash, withdraw, perform conversion operations. And more.
Expenditure control
With a rechargeable card you can control your expenses to the maximum.
You only decide what amount to deposit and what amount of money is in your
card at any given moment. This way you can control your money
as much as possible. Deposit any amount you want to spend on any
period that suits you, keep track of your expenses, and save.
The truth is that you do not even have to keep track of your expenses.
You can use the card as you wish and simply as soon as the funds
run out the transactions will be refused. But if you want to avoid this
situation of inconvenience it is better to make frequent monitoring of the funds
Whether you want to have a debit card or not, it is your right to know
about their existence and meaning in our lives as consumers.
