meta_id 3130887

On May 6, 2026, the Bank of Israel announced a tiered banking licence framework as part of its ongoing efforts to promote competition within Israel's banking system while maintaining financial stability, fairness, and consumer protection. The Bank of Israel has undertaken significant infrastructure reforms in recent years to facilitate the entry of new market participants into the banking sector. These efforts have resulted in the establishment of two new banks for the first time in approximately 40 years. The tiered licensing framework is designed to reduce regulatory and structural barriers to entry, enabling smaller and new banking entities to obtain licences more easily. The framework is anchored in the Law for Promoting Competition in the Banking Market (Legislative Amendments), 5786–2026, which establishes the first legislative framework for micro and small banks. The tiered regulation will be proportionate to the size and complexity of each banking entity's operations. Recent approvals demonstrate the framework's practical application: the Bank of Israel Governor approved Revolut Payments Israel Ltd to advance through required stages of the banking licence process, and Ash Bank Israel Ltd to proceed with access and representation in payment systems. These entities join One Zero Bank, which began providing services to the public approximately three years ago. The tiered licensing approach is expected to broaden the range of market participants and products available in Israel's banking system, increase competition in credit and deposit markets, and improve services for households and small businesses. The Bank of Israel will publish detailed regulation accompanying this framework in the coming days.