From today non-banking credit companies can receive information from banks and credit card companies about the financial activities of bank customers, with the customer's consent. This latest move is part of the open banking reform introduced in April 2021 by the Supervisor of Banks, in which banks are required to transfer data about their clients to third parties, with their approval.
This is the second stage of the reform. According to the schedule for implementation of the reform, which has already been postponed several times, as part of the open banking reform in the Economic Arrangements Law, since the end of March, banks were supposed to have shared information with other banks about customers' debts on credit cards. Now, the information about credit card use will be open to the entire banking system, with customers' approval, if they want to receive better value offers from other players.
In the first stage of the reform, which began in April 2021, banks were permitted to provide information to rivals about current accounts of customers, although in practice there has been little cooperation between the banks on the matter.
From the end of October 2022, banks will be required to provide information about loans and deposits and as from December 2022 small non-banking credit enterprises can join the information sharing and from December 2023 large non-banking credit enterprises. In June 2023, institutions will be required to pass on information about the securities held by their customers.
Fintech companies will not yet be allowed to join the information sharing and will not be granted a license to do so.
Published by Globes, Israel business news - en.globes.co.il - on June 14, 2022.
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