The minimum credit card limit will increase to NIS 12,000


The outline that is being formed between the Bank of Israel, the Treasury and the banks may include an increase in the minimum possible amount for cutting bank credit facilities, in order to protect the middle class that has been significantly affected by the corona crisis.

The “Strum Law” stipulates that credit facilities may not be reduced by less than NIS 5,000, but due to the economic consequences of the corona crisis, negotiations are underway to increase the amount to between NIS 7,000 and NIS 12,000.

Read more in Calcalist:

Another option being considered is a reduction in the total amount required for the cut, which currently stands at 50% of the total credit card frameworks of each of the banks. Yesterday, a discussion was held in the Finance Committee, chaired by MK Moshe Gafni, on the issue of cutting the bank credit card line for customers of large banks.

The Chairman of the Finance Committee, Moshe Gafni, and the Governor of the Bank of Israel, Amir Yaron. The outline is being formulated Photo: Alex Kolomoisky

As published in “Calcalist”, under the Shtrum law, Bank Hapoalim and Bank Leumi must cut 50% of the credit card frames for their customers by the end of the year. The banks have already made some of the cuts in the last three years, but it is estimated that they have a further NIS 10 billion to cut out of a total of NIS 20 billion.

The representative of the Bank of Israel at the hearing, Dr. Ziv Naor, director of the economic unit in the Supervisor of Banks, said that the Bank of Israel wants to formulate a new outline with the Treasury because of changes following the corona. And we want to make an informed decision, “she said.

Banks were required to make the cuts under the Strum Act, a reform that took place three and a half years ago and aimed to increase competition in the financial system and strengthen non-bank players in their activities vis-à-vis households. The reduction in credit facilities is expected to hurt banks’ revenues from the use of credit cards, as they benefit from revenues due to the extent of use. The goal was that whoever earned the same income would be the credit card companies. Banks can make the move by the end of 2020, with the scope of the cut-off framework remaining in effect for three years.

Already when the issue came up in the Strum Committee, the banks opposed the minimum height of the frameworks and sought to raise it, and among credit card companies claim that banks are taking advantage of the corona crisis to harm competition and achieve a goal unrelated to crisis or middle class.

Tomorrow, the Economics Committee will discuss the issue, and then Finance Minister Israel Katz and the Governor of the Bank of Israel, Prof. Amir Yaron, will have to formulate their opinion on the issue, and they will have to approve the possible changes in the law in the Economics Committee. The issue is more related to the Economics Committee than to the Finance Committee, and insiders explain that the double discussion is carried out solely for political reasons, and not for material reasons. The Supervisor of Banks, Yair Avidan, is expected to participate in the discussion in the Economics Committee.

The credit card companies Max and Isracard stated: “The Max and Isracard companies, which were separated from the two major banks in order to promote competition and reduce centralization in the banking system, announce that they were prepared in advance to offer alternative frameworks.” “Israel. It would be inappropriate to take any step that would delay the reform and harm competition for the benefit of the public, households and businesses, precisely when they need it most of all.”

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