Israeli Legislation.com
LawCorporate & Business

Financial Services Supervision Law (Regulated Financial Services), 5776-2016

חוק הפיקוח על שירותים פיננסיים (שירותים פיננסיים מוסדרים), תשע"ו-2016

Published: 2016-08-01Consolidated Hebrew text as of 2026-07-26 · Last amended 2026-07-22✓ Amendment status checked against the Knesset legislation record on 2026-09-17
Premium
Unofficial English translation — for reference only. It may contain errors or omissions and cannot be relied on as a legal text. Only the Hebrew text published in Reshumot is legally binding.More

This English text was translated from the official Hebrew using a range of translation tools, and it undergoes ongoing checks and updates. It is not a certified translation.

Despite these checks, it may contain errors, omissions, or imprecise renderings of legal terminology and cross-references, and it may not yet reflect the latest amendments. It cannot be relied upon as a legal text.

The Hebrew text as published in Reshumot (ספר החוקים) and on the Knesset website is the sole authoritative and legally binding version. In any discrepancy, the Hebrew text prevails.

This translation is provided for informational purposes only and does not constitute legal advice. For use in legal proceedings, request a certified Expert Legal Opinion.

Chapter III-A: Licence for the Provision of Deposit and Credit Services

Definitions – Chapter III-A§

25a.

In this Chapter –

"credit" – as defined in the Banking Law (Licensing);

"banking scope of activity" – a deposit portfolio or a credit portfolio exceeding one billion and five hundred million new shekels, or a higher amount set by the Minister with the consent of the Governor of the Bank of Israel and with the approval of the Finance Committee of the Knesset;

"extensive scope of activity" – a deposit portfolio exceeding 50 million new shekels, or a higher amount set by the Minister with the approval of the Finance Committee of the Knesset, or a credit portfolio exceeding 25 million new shekels, or a higher amount set by the Minister with the approval of the Finance Committee of the Knesset;

"provision of credit" – as defined in section 21(b) of the Banking Law (Licensing);

"deposit" – any payment, including a loan, grant or donation, in respect of which one of the following conditions is met, excluding a payment of a type prescribed by the Minister:

(1)it is accompanied by the right to receive it back, in whole or in part, whether the right belongs to the payer or has been assigned or conveyed to a third party; for this purpose, a payment given in consideration of the acquisition of means of control in a cooperative society that confers on the acquirer the right to its redemption upon the cessation of membership in the association shall not be deemed a deposit;
(2)it is accompanied by the right to receive a grant or credit from the recipient of the payment, whether the right belongs to the payer or has been assigned or conveyed to a third party;
(3)other conditions prescribed by the Minister are met in respect of it;

"credit portfolio" – as defined in section 11a, with the necessary modifications;

"deposit portfolio" – the total liabilities of a licence holder arising from the actual receipt of deposits;

"receipt of deposits" – as defined in the definition of "receipt of monetary deposits" in section 21(b) of the Banking Law (Licensing);

"interest" – any consideration given in connection with credit or a deposit that constitutes an addition to the principal, whatever its designation, and in respect of a deposit accompanied by the right to receive credit, as referred to in paragraph (2) of the definition of "deposit" in this section – including the retention of part of the deposit funds by the credit provider in connection with the provision of the credit, all except for –

(1)commissions for the purpose of covering operating expenses, of a type, in an amount or at a rate prescribed by the Minister;
(2)reimbursement of reasonable expenses incurred in connection with a delay in the repayment of credit, of a type, in an amount or at a rate prescribed by the Minister;
(3)any amount added to the principal by virtue of linkage conditions to one of the following:
(a)the exchange rate of the Israeli currency or another currency approved by the Supervisor, as published by the Bank of Israel;
(b)the Consumer Price Index, or another index approved by the Supervisor, as published by the Central Bureau of Statistics;

"licence" – a licence for the provision of deposit and credit services;

"basic licence" – a licence to engage in the provision of deposit and credit services on a scope of activity that is not an extensive scope of activity;

"extended licence" – a licence to engage in the provision of deposit and credit services on an extensive scope of activity;

"licence for the provision of deposit and credit services" – a licence to engage in the provision of deposit and credit services, granted under this Chapter, whether it is a basic licence or an extended licence;

"deposit and credit services" – the receipt of deposits and the provision of credit, together, carried out by way of business, provided that the deposits or the credit, in whole or in part, bear interest.

Licensing obligation – licence for the provision of deposit and credit services§

25b.
(a)An association that is not a banking corporation shall not engage in the provision of deposit and credit services on a scope of activity that is below a banking scope of activity, unless it holds a licence for the provision of deposit and credit services and in accordance with the conditions of the licence.
(b)A person who holds a licence as referred to in subsection (a) shall not engage in the provision of deposit and credit services on an extensive scope of activity unless that person holds an extended licence.
(c)Notwithstanding the provisions of subsection (b), a person who holds a licence as referred to in subsection (a) may engage in the provision of deposit and credit services on an extensive scope of activity, even if that person does not hold an extended licence, if that person submitted an application for an extended licence within 30 days of the date on which the scope of that person's activity became an extensive scope of activity, and for as long as both of the following conditions are met in respect of that person:
(1)no decision has yet been given on the application for an extended licence;
(2)the scope of that person's activity does not exceed twice the minimum extensive scope of activity required for the grant of an extended licence.
(d)Notwithstanding the provisions of subsection (a) and the provisions of sections 21 and 22a of the Banking Law (Licensing), an association holding a licence as referred to in subsection (a) that is an extended licence may continue to engage in the provision of deposit and credit services on a banking scope of activity, even though it is not a banking corporation, if it submitted to the Governor of the Bank of Israel an application for a licence under the Banking Law (Licensing) before the date on which the scope of its activity became a banking scope of activity, and for as long as both of the following conditions are met:
(1)the Governor of the Bank of Israel has not yet given a decision on the application for a licence under the Banking Law (Licensing);
(2)the scope of its activity does not exceed 110% of the amount prescribed in the definition of "banking scope of activity" in section 25a, or another amount prescribed pursuant thereto, to the extent prescribed.

Exceptions to the Licensing Requirement – Licence for the Provision of Deposit and Credit Services§

25c.
(a)The licensing requirement under section 25b shall not apply to the following:
(1)an insurer as defined in the Insurance Supervision Law;
(2)a managing company as defined in the Provident Funds Supervision Law.
(b)The Minister, with the approval of the Finance Committee of the Knesset, may, by Regulations, exempt additional classes of bodies from the licensing requirement under section 25b; such an exemption shall not derogate from the provisions under the Banking Law (Licensing).

Types of Licences§

25d.

A licence for the provision of deposit and credit services may be either a basic licence or an extended licence.

Conditions for the Grant of a Basic Licence§

25e.
(a)The Supervisor may grant a basic licence to an applicant in respect of whom all of the following conditions are met:
(1)the licence applicant is an association for which no receiver has been appointed and no winding-up order has been issued, and at least one of its office holders is an Israeli citizen or a resident of Israel;
(2)the licence applicant has the minimum equity capital required of a basic licence holder, in accordance with the provisions of section 37 and the First Schedule;
(3)the licence applicant has not been convicted of an offence which, by reason of its nature, gravity or circumstances, renders the licence applicant unfit to engage in the provision of deposit and credit services, and no indictment has been filed against the applicant for such an offence in respect of which a final judgment has not yet been given, and there are no other circumstances which, in the Supervisor's opinion, cast doubt on the applicant's integrity and uprightness according to the criteria prescribed by the Supervisor under section 4(b); for this purpose and without derogating from the generality of the foregoing –
(a)each of the offences listed in section 15(a)(3)(a) shall be deemed an offence in respect of which the conditions set out in this paragraph are met, unless the Supervisor has found that there are special reasons relating to the circumstances of commission of the offence and its degree of gravity by reason of which there is no impediment to engaging in the provision of deposit and credit services;
(b)"convicted of an offence" – includes conviction of a similar offence in another country;
(4)the office holders of the licence applicant satisfy the conditions for the appointment and tenure of an office holder in a licence holder under Chapter V;
(5)the controlling shareholder and the interested party in the licence applicant satisfy the conditions for obtaining a permit under Chapter IV.
(b)If the Supervisor has found that, for reasons of public interest, the licence applicant is unfit to engage in the provision of deposit and credit services, the Supervisor may decline to grant a licence to the applicant, even if the conditions set out in subsection (a) are met in respect of the applicant, provided that the Supervisor has given the applicant an opportunity to present the applicant's arguments before the Supervisor or before a person whom the Supervisor has authorised for that purpose from among the Supervisor's employees, in the manner prescribed.

Conditions and Considerations for the Grant of an Extended Licence§

25f.
(a)The Supervisor may grant an extended licence to an applicant in respect of whom, in addition to the conditions referred to in section 25e, all of the following conditions are met:
(1)the licence applicant has the minimum equity capital required of an extended licence holder, in accordance with the provisions of section 37 and the First Schedule;
(2)the corporate structure meets the requirements under Chapter V.
(b)When deciding on an application for the grant of an extended licence, the Supervisor shall take into account, inter alia, the following matters:
(1)the objectives of the licence applicant as set out in its incorporation documents;
(2)the business plan of the licence applicant and the applicant's prospects of implementing it;
(3)the financial resources and sources of financing of the licence applicant;
(4)considerations of public interest.

Application for a Licence for the Provision of Deposit and Credit Services§

25g.

The provisions of section 17 shall apply, with the necessary modifications, to the submission of an application for a licence.

Application of Provisions in respect of a Licence for the Provision of Deposit and Credit Services§

25h.

The provisions of sections 18 to 22 and 24 shall apply in respect of a licence and a licence holder under this Chapter, with the necessary modifications, and with the following modification: the reporting obligation under section 22(b) shall apply, with the necessary modifications, also in respect of a change in the aggregate of deposits.

Revocation or Suspension of a Licence for the Provision of Deposit and Credit Services§

25i.
(a)The Supervisor may revoke a licence or suspend it upon the occurrence of the circumstances set out in section 23(a)(1) to (6), with the necessary modifications, and also upon the occurrence of any one of the following:
(1)reasons of public interest justify the revocation of the licence or its suspension;
(2)the scope of activity of the licence holder is of a banking scope of activity and the circumstances set out in section 25b(d) are not met.
(b)The provisions of section 23(b) to (d) shall apply, with the necessary modifications, to the revocation or suspension of a licence under this section.

Need to cite this law in a foreign court?

Eli Shimony Israeli Attorneys-at-Law provides certified Expert Legal Opinions on Israeli law within 24–48 hours, accepted by courts worldwide.

Contact Us →

Chapter III-B: Issuance Licence

25j.§

(Repealed — תשפ״ג־2)

25k.§

(Repealed — תשפ״ג־2)

25l.§

(Repealed — תשפ״ג־2)

25m.§

(Repealed — תשפ״ג־2)

25n.§

(Repealed — תשפ״ג־2)

25o.§

(Repealed — תשפ״ג־2)

25p.§

(Repealed — תשפ״ג־2)

Need to cite this law in a foreign court?

Eli Shimony Israeli Attorneys-at-Law provides certified Expert Legal Opinions on Israeli law within 24–48 hours, accepted by courts worldwide.

Contact Us →

Chapter III-C: Licence for the Operation of a Credit Intermediation System

Definitions – Chapter III-C§

25q.

In this Chapter –

"extensive scope of activity" – an aggregate of credit exceeding NIS 25 million or a higher amount set by the Minister, with the approval of the Finance Committee of the Knesset;

"borrower" – any of the following:

(1)an individual who receives credit from a lender through a credit intermediation system;
(2)a corporation incorporated in Israel that is not a reporting corporation as defined in the Securities Law, to which the provisions of section 15b(4b) of that Law apply, that receives credit from a lender through a credit intermediation system, and whose total credit debt existing to the corporation through credit intermediation systems does not exceed six million new shekels;

"customer" – a lender or a borrower;

"lender" – a person who extends credit to a borrower through a credit intermediation system, as well as a person who transfers funds to a holder of a licence to operate a credit intermediation system for the purpose of their being extended as credit to a borrower through the system;

"social credit intermediation system" – a credit intermediation system that operates only in respect of credit transactions that do not bear interest, and in which the amount of credit extended through it to a particular borrower does not exceed NIS 300,000 per year or another amount set by the Minister, in consultation with the Minister of Justice and with the approval of the Finance Committee of the Knesset, provided that the amount of credit originating from a single lender does not exceed NIS 100,000 or another amount prescribed by the Supervisor; for this purpose, "interest" – any consideration given in connection with credit that constitutes an addition to the principal, by whatever name it may be called, except for –

(1)fees for the purpose of covering operating expenses, of a type, in an amount or at a rate set by the Minister;
(2)reimbursement of reasonable expenses incurred due to a delay in the repayment of credit, of a type, in an amount or at a rate set by the Minister;
(3)any amount added to the principal by reason of linkage conditions to one of the following:
(a)the exchange rate of the Israeli currency or of another currency approved by the Supervisor, published by the Bank of Israel;
(b)the consumer price index, or another index approved by the Supervisor, published by the Central Bureau of Statistics;

"credit intermediation system" – an online system operating through the Internet or by other technological means prescribed by the Minister by Order, used to intermediate between lenders and borrowers for the purpose of executing credit transactions and administering such transactions;

"commission" – any consideration due to a licence holder for the services provided by the licence holder to its customers; the Supervisor may issue directives in respect of types of commissions, their rates and scope;

"aggregate of credit" – the total of all debts of borrowers to lenders in a credit intermediation system operated by a licence holder, plus the total of all funds of lenders transferred to the licence holder that have not yet been allocated as loans to borrowers;

"basic licence" – a licence to engage in the operation of a credit intermediation system at a scope of activity that is not an extensive scope of activity;

"licence to operate a credit intermediation system", "licence" – a licence to engage in the operation of a credit intermediation system granted under this Chapter, whether it is a basic licence or an extended licence;

"extended licence" – a licence to engage in the operation of a credit intermediation system at an extensive scope of activity.

Licensing Requirement§

25r.
(a)A person shall not engage in the operation of a credit intermediation system unless that person holds a licence to operate a credit intermediation system and acts in accordance with the conditions of the licence.
(b)A person who holds a licence as referred to in subsection (a) shall not engage in the operation of a credit intermediation system at an extensive scope of activity unless that person holds an extended licence.
(c)Notwithstanding the provisions of subsection (b), a person who holds a licence as referred to in subsection (a) may engage in the operation of a credit intermediation system at an extensive scope of activity, even if that person does not hold an extended licence, if the person has submitted an application for an extended licence within 30 days from the date on which the person's scope of activity became an extensive scope of activity and for as long as both of the following conditions are met:
(1)a decision has not yet been given on the application for an extended licence;
(2)the person's scope of activity does not exceed twice the minimum extensive scope of activity required for obtaining an extended licence.

Exceptions to the Licensing Requirement§

25s.
(a)The licensing requirement under section 25r shall not apply to the following:
(1)an acquirer as defined in section 36i of the Banking Law (Licensing), as well as a corporation controlled by the acquirer or a corporation in which the acquirer holds more than 20% of a particular class of means of control;
(2)a banking corporation and an auxiliary corporation.
(b)The Minister, with the approval of the Finance Committee of the Knesset, may, by Regulations, exempt additional classes of bodies from the licensing requirement under section 25r.

Types of Licences§

25t.

A licence to operate a credit intermediation system may be either a basic licence or an extended licence.

Conditions for the Grant of a Basic Licence§

25u.
(a)The Supervisor may grant a basic licence to an applicant in respect of whom all of the following conditions are met:
(1)in respect of a licence applicant who is an individual – the applicant is of legal age, an Israeli citizen or a resident of Israel, has not been declared legally incompetent and no receiving order has been issued against the applicant in bankruptcy proceedings; and in respect of a licence applicant that is a corporation – the applicant has been incorporated and registered in Israel, no court has appointed a receiver for it or ordered its winding-up, and at least one of its office holders is an Israeli citizen or a resident of Israel;
(2)the licence applicant has the minimum equity capital required of a basic licence holder, in accordance with the provisions of section 37 and the First Schedule;
(3)the licence applicant, and if the applicant is an individual – also a person of influence in the applicant, has not been convicted of an offence which, by reason of its nature, gravity or circumstances, renders the licence applicant unfit to engage in the operation of a credit intermediation system, and no indictment has been filed against the applicant for such an offence in respect of which a final judgment has not yet been given, and there are no other circumstances which, in the Supervisor's opinion, cast doubt on the applicant's integrity and uprightness according to the criteria prescribed by the Supervisor under section 4(b); for this purpose and without derogating from the generality of the foregoing –
(a)each of the offences listed in section 15(a)(3)(a) shall be deemed an offence in respect of which the conditions set out in this paragraph are met, unless the Supervisor has found that there are special reasons relating to the circumstances of commission of the offence and its degree of gravity by reason of which there is no impediment to engaging in the operation of a credit intermediation system;
(b)"convicted of an offence" – includes conviction of a similar offence in another country;
(4)the office holders of the licence applicant satisfy the conditions for the appointment and tenure of an office holder in a licence holder under Chapter V;
(5)in respect of a licence applicant that is a corporation – the controlling shareholder and the interested party in the applicant satisfy the conditions for obtaining a permit under Chapter IV.
(b)If the Supervisor has found that, for reasons of public interest, the licence applicant is unfit to engage in the operation of a credit intermediation system, the Supervisor may decline to grant a licence to the applicant, even if the conditions set out in subsection (a) are met in respect of the applicant, provided that the Supervisor has given the applicant an opportunity to present the applicant's arguments before the Supervisor or before a person whom the Supervisor has authorised for that purpose from among the Supervisor's employees, in the manner prescribed.

Conditions and Considerations for the Grant of an Extended Licence§

25v.
(a)The Supervisor may grant an extended licence to an applicant in respect of whom, in addition to the conditions referred to in section 25u, all of the following conditions are met:
(1)the licence applicant has been incorporated and registered in Israel;
(2)the licence applicant has the minimum equity capital required of an extended licence holder, in accordance with the provisions of section 37 and the First Schedule;
(3)the corporate structure meets the requirements under Chapter V;
(4)the licence applicant has appended to the application a work plan demonstrating the applicant's ability to comply with the provisions of this Law.
(b)When deciding on an application for the grant of an extended licence, the Supervisor shall take into account, inter alia, the work plan referred to in subsection (a)(4) as well as considerations of public interest.

Application for a Licence§

25w.

The provisions of section 17(a) and (b) shall apply, with the necessary modifications, to the submission of an application for a licence.

Application of Provisions in respect of a Licence§

25x.

The provisions of sections 18 to 22 and 24 shall apply in respect of a licence and a licence holder under this Chapter, with the necessary modifications.

Revocation or Suspension of a Licence§

25y.
(a)The Supervisor may revoke a licence or suspend it upon the occurrence of the circumstances set out in section 23(a)(1) to (6), with the necessary modifications, and also if there are reasons of public interest justifying the revocation of the licence or its suspension.
(b)The provisions of section 23(b) to (d) shall apply, with the necessary modifications, to the revocation or suspension of a licence under this section.

Need to cite this law in a foreign court?

Eli Shimony Israeli Attorneys-at-Law provides certified Expert Legal Opinions on Israeli law within 24–48 hours, accepted by courts worldwide.

Contact Us →
← 1234…12 →

Page 3 of 12

Read the entire law on one page — continuous text, no page breaks, plus PDF downloads.