The way Israeli merchants do business is about to change - here’s how

“The most exciting thing happened this June, the payment service provider law was passed by the parliament and will come into force in one year's time. This law is a supplementary law to The Payment Services Law from 2019, and it requires the payment companies to be licensed and be supervised by the Israeli Securities Authority.”

Inbal Polak, Director of the Investment Department at the Israel Securities Authority, spoke to CTech about how the new law will impact Israeli merchants who sell overseas and customers who are purchasing things from abroad. “Israelis are very tech-savvy and we like online shopping. Today, we pay a lot to buy overseas. This reform will bring lower fees, lower payment service, and better service.”

According to Gross Law Firm: “The framework enables certain eligible international PSPs to connect to the following Payments Systems: Zahav (RTGS) system operated by the BoI; the payment systems operated by the company Shva: the ‘Payment Card Service’ system and the ‘ATM Switch’ system; and payment systems operated by Masav: ‘Debits, Credits, and Payment Transfers’ and the “Immediate payments (online)”.

So what does this mean for Israel? Polak continued: “The law that was passed has placed only the ground rules. This year, the Israel Securities Authority will publish all of the rules that these companies will have to stand by. In a year's time, we will start giving licenses and from that moment on, connection to the system centers to the payment systems, and they will start giving service to the end client and to the merchants.”

You can learn more about the new law via the video above.