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Best banks in Israel

May 27, 2024 126 Time to read: 8 min.

There are not many credit institutions in Israel. Nevertheless, most of the services are provided by a few best credit institutions.

Overview of Israeli banking system

In the banking system, nothing new has been invented in Israel. As in most developed countries of the world, there are two levels of banks:

  1. The regulator of the country’s banking system is the Bank of Israel. It has the exclusive right to issue money. In addition, the main bank issues loans to the government.
  2. As in most other countries, commercial banks are involved in serving legal entities and individuals. It is noteworthy that the controlling stakes in the largest commercial organizations are in the hands of the government.
The country has a well-established system of banks. With the exception of Digital Bank, not a single new credit institution has appeared in recent years.

Top banks in Israel

There are five banks that occupy key positions in Israel:

Bank Hapoalim

Translated from Hebrew, the name of the credit institution means “the bank of workers”. Although the bank’s activities have changed, the old name has stuck to it.

The founders of Hapoalim in 1921 were two organizations:

  1. the World Zionist Organization.
  2. Jewish Federation of Labor “Gistatrud”.

Hapoalim made a significant contribution to the formation of the young Israeli state. But as a result of the economic crisis of 1983, it went bankrupt and was privatized.

Currently, in assets and profits, Hapoalim is the second in the ranking of financial institutions in Israel. Its income consists of interest, commissions and fees. A large share in the capital is occupied by proceeds from trading in securities. Mortgage lending to the population accounts for approximately 33% of all loans.

Bank Leumi

The predecessor of the leumi was established as early as 1903 under the name of the Anglo-Palestine Bank. At its origins was the creator of Zionism, Theodor Herzl. The Bank played an important role in preparing the ground for the State of Israel. It has contributed to the development of industry, agriculture, and infrastructure projects.

Prior to the establishment of the main bank of Israel in 1954, the Anglo-Palestine Bank had the right to issue its own money. When this function was transferred to the financial regulator of the state, the bank was renamed and received its current name.

Today, it has 5 branches abroad and 268 within the country. With a capitalization of 45 billion shekels, Leumi supports 35 companies with investments, provides all kinds of banking services to individuals and legal entities. This bank is the largest credit institution in the Jewish state in terms of assets. The Leumi Group has branches in the USA, Great Britain, China, Switzerland, Mexico.

Israel Discount Bank

The full name is Israel Discount Bank Ltd. It is among the top three in the country. Besides, Discount Bank is in the list of the top 300 commercial banks of the world. The scope of its activities includes:

  • investments in financial transactions;
  • credit card issuance;
  • asset management.

Last year, capitalization amounted to NIS 24 billion. Discount is one of the pioneers of online banking. The credit institution has many branches in the country and abroad.

Mizrahi Tefahot Bank Mizrahi

Tahafot Bank is the leader in mortgage lending in Israel. It has 140 branches. In 2017, the bank strengthened its position by buying out Union Bank of Israel. Through subsidiaries and branches abroad, Mizrahi Tahafot successfully carries out financial transactions in international financial markets, including the United States and the United Kingdom.

This credit organization is considered the most conservative and stable in the Promised Land. It shows efficiency in providing customers with a wide range of services.

First International Bank of Israel (FIBI)

The main contingent is large corporate clients. The credit institution provides all kind of services to corporations, entrepreneurs and individuals.

Attention: The First International Bank of Israel was the only credit institution that was not affected by the economic crisis of 1980 and avoided nationalization.

This financial institute is one of the leaders in operations in the markets of Israeli and foreign stocks. He has an impeccable reputation in the field of professional consulting. FIBI actively implements modern technologies and develops its own programs.

Specialized banks in Israel

Israel’s banking system is based on several large banks that have taken this area into their own hands. Five credit institutions control 90% of banking services.

But the country actively uses the services of microfinance organizations when money is urgently needed. The advantages of these organizations are:

  • do not require a lot of paperwork;
  • give short-term loans;
  • quickly process applications;
  • serve customers at any time of the day or night;
  • provide information on the size of rates, commissions, and refund terms even before the conclusion of the contract.
Unlike banks, microfinance organizations do not spend time studying credit history. For this reason, this way of making quick money is quite common.

Services offered by Israeli banks

Israeli and foreign banks represented in this country provide all types of services to customers:

  • loans;
  • cash and settlement operations;
  • mortgage;

  • investing in securities and real estate;
  • current and savings accounts;
  • currency exchange;

Modern technologies are being introduced into the banking sector to increase the security of credit institutions and improve the quality of customer service.

Large banks have mobile applications and make online banking available. Digital technologies have made it possible to create ONE ZERO Bank in the country, in which all transactions are carried out digitally. For the conservative banking system of the Jewish state, this is a revolutionary step into the future. The bank’s license turned out to be the only one in the last 40 years. Israelis appreciated the convenience of the new credit institution. Over the year, 60 thousand people became its clients.

Another innovation delighted the Israelis. In 2017, Bank Leumi created a subsidiary Pepper. All its activities are carried out through a mobile application. The most important advantage is that all services are free. Service is available around the clock through video chats, messages and phones.

Along with these conveniences, customers note some disadvantages of banking services. In particular, they are not satisfied with the working hours. Commercial institutions are usually open until 12.00. At this time, people are at work. Additional reception hours from 16.00 to 18.00 on some days do not save either. Customers are not satisfied with commissions and fees. They have to pay for:

  • withdrawing funds from ATMs and branches;
  • account maintenance;
  • transaction;
  • cheque books;
  • transactions on a bank card.

The amount of fees and commissions in banks is different. They should be clarified when choosing a financial organization.

How to choose the right bank in Israel

When choosing a credit institution, it is best to first be guided by the advice of friends and relatives who live in Israel. Their opinions will be contradictory, but they will give an idea of the main criteria for choosing.

We want to offer several approaches to choosing a credit institution that will help you understand the intricacies of the banking sector:

  1. Differences in banks. They differ from each other in transactions. Some are beneficial for individuals, others for business. The work on customer service is organized in different ways in them. Somewhere online banking works well, and somewhere not so much. In some banks, for example, in Mizrahi Tfakot, a personal assistant is assigned to the client. He knows everything about you and communicates with you in the right language.
  2. Availability of online banking. You can communicate with the credit institution at any convenient time through the app or website. This is especially important for those clients who do not speak Hebrew well. The presence of a call center is important.
  3. Bank commissions. Credit institutions are competing to provide digital services. They are cheaper than in the office.

Tip: try to use ATMs located on the premises of credit institutions. In trade organizations, you will definitely be charged a commission.

When cooperating with the bank, try to receive your salary there. This will make it possible to reduce the size of commissions.

In Israel, it is imperative to open a bank account in order to live a full life. All payments will be received in the bank of your choice. To open an account, you need to provide a list of mandatory documents. If there are no questions to you, after depositing a small amount, the account will be opened.

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