The Banking Supervision Department of the Bank of Israel has decided to lift its restrictions on opening an online bank account. Sources inform "Globes" that the department recently issued a draft circular to the banks stating that it is cancelling the restrictions that applied up to now on opening a bank account without visiting a bank branch and face-to-face identification.
Almost three years ago, the Bank of Israel allowed a bank account to be opened without the customer physically visiting a bank branch, but stipulated that this would be subject to restrictions, for fear that opening an account in this way would be exploited for money laundering purposes. The main restriction was that only a customer with an existing bank account could open an additional account online, since such a customer had already undergone face-to-face identification and a "know your customer" process. Another condition was a bank transfer from the existing account to open the new account. This condition too is being cancelled.
The restriction meant that young customers, the main source of demand for online banking, could not open a bank account without going to a bank branch. Now they will be able to do so. In addition, the previous rules stipulated that an online account could only be opened from age 18. This restriction too has been eased: the minimum age from now on will be 16.
"Following technological advances in remote visual identification and verification, and because of the desire to simplify the identification and verification process in opening a bank account as much as possible, we seek to update the guidelines on opening and running an online bank account," the Banking Supervision Department writes in the draft circular.
Published by Globes [online], Israel business news - www.globes-online.com - on November 20, 2017
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