“Globes” has carried out a comparative survey among Israel’s top five banks on the terms and benefits they offer to students. It is hard to identify a winner, since all the banks offer a slew of benefits, but emphasize different points. Following are some conclusions:
Account management and basic fees - advantage Israel Discount Bank (TASE: DSCT). Whereas all the banks grant more or less the same exemptions on basic fees for the bank account, Mizrahi Tefahot Bank (TASE:MZTF) offers the worst terms, limiting the benefit to one year, after which it charges NIS 8 per month. In contrast, Discount Bank offers a fourth year bonus to students who complete their studies in three years.
Installments on tuition - advantage Bank Hapoalim (LSE: BKHD; TASE: POLI) and Bank Leumi (TASE: LUMI). This is a critical factor for many students. These two banks offer six installments with no interest. Mizrahi Tefahot Bank and First International Bank of Israel (TASE: FTIN1;FTIN5) offer three installments at no interest, and Discount Bank has no such program at all.
Financing terms - advantage Bank Hapoalim and Mizrahi Tefahot Bank. These two banks offer the highest loan limit of up to NIS 60,000, albeit the words “up to” indicate that the actual loan is subject to the customer’s profile. Bank Hapoalim, Discount Bank, and Mizrahi Tefahot Bank offer a grace period on payment of the loan principal until after studies. This option may help students who are unable to work during their studies and will only see regular income in a few years. Other students ought to carefully consider whether to postpone to tomorrow what they might be able to pay, even if with difficulty, today.
Direct banking is free only at Bank Hapoalim and Mizrahi Tefahot Bank, which are the only two banks to provide free information services via the Internet and cellular. First International Bank offers discounts on these services, while Bank Leumi and Discount Bank apparent do not offer a service that is especially suited to a young clientele.
Registration gift - advantage First International Bank. It is important to remember that despite the immediate gratification, a registration gift is of secondary importance compared with the actual terms offered on the account.
A banker said that the banks are investing heavily to attract students, compared with IDF personnel for example. The banks offer students a slew of benefits for several reasons. First, this is a more mature clientele, who do not always have a good relationship with their parents’ bank branch and who are often far away. Banks also desire students because they will have a higher education, which statistically translates into higher income. Today’s students will be tomorrow’s doctors, lawyers, accountants, financiers, and engineers, so it is worthwhile to win them over, the earlier, the better.
Published by Globes [online], Israel business news - www.globes.co.il - on October 15, 2007
© Copyright of Globes Publisher Itonut (1983) Ltd. 2007