RegAlert

Israel: fintech & payments regulation — 2026-08

Regulated

Israel: Payment Services Law 2015; BoI regulates VASPs & payment institutions

Frozen snapshot — the guide as it stood at the end of 2026-08. See the live guide for the current state.

Israel regulates fintech and payments primarily under the Payment Services Law, 2015, supervised by the Bank of Israel (BoI). The regime distinguishes between Payment Institutions (PIs) and Virtual Asset Service Providers (VASPs). PIs require a license and capital, while VASPs are registered. The regulatory stance is strict on AML/CFT and consumer protection, with the BoI actively enforcing compliance through directives.

Which licence do you need?

Your activityRequirementCapitalTimelineAuthority
Payment processing / gatewayLicencePayment Institution License[1][2]

Requires PI license under Payment Services Law

NIS 500,0003-6 monthsBank of Israel
E-money & wallet issuanceLicencePayment Institution License[1][2]

Issuing electronic money requires PI license

NIS 500,0003-6 monthsBank of Israel
Domestic money transferLicencePayment Institution License[1][2]

Domestic transfers fall under PI license

NIS 500,0003-6 monthsBank of Israel
Cross-border remittanceLicencePayment Institution License[1][2]

Cross-border remittance requires PI license

NIS 500,0003-6 monthsBank of Israel
Agent networkLicencePayment Institution License[1][2]

Agent networks must be approved by licensed PI

NIS 500,0003-6 monthsBank of Israel
Open banking / account informationUncertainverify with regulator

No specific open banking law; relies on general payment rules

———
Foreign-exchange servicesLicencePayment Institution License[1][2]

FX services require PI license

NIS 500,0003-6 monthsBank of Israel

New — what changed recently

  • 2024-04-09Directive 03/24 — BoI issued comprehensive framework for broker-dealer activities of banking corporations[3]
  • 2023-11-21Temporary Directive (Swords of Iron) — BoI granted operational flexibilities to banks due to war impacts[4]
  • 2023-08-13Amendment to Directive 450 — BoI amended debt collection procedures to align with legislative updates[5]

Market-entry checklist

  1. 1Secure PI License from BoIApply for Payment Institution License with NIS 500,000 capital and approved business plan.
  2. 2Register with IMPA for AMLRegister as a reporting entity with the Israel Money Laundering and Terror Financing Prohibition Authority.
  3. 3Establish Segregated AccountsOpen trust accounts at licensed banks to hold customer funds separately from corporate assets.
  4. 4Implement KYC/AML SystemsDeploy robust customer identification and transaction monitoring systems compliant with BoI directives.
  5. 5Appoint Compliance OfficerDesignate a qualified compliance officer responsible for AML/CFT and regulatory reporting.

Sources

  1. Banking Ordinance, 1941 · 2025-05-19
  2. Banking (Licensing) Law, 5741-1981 · 2024-12-30
  3. A Banking Corporation’s Activities as a Broker-Dealer · 2024-04-09
  4. Adjustments to Proper Conduct of Banking Business Directives for the “Swords of Iron” War (Temporary Directive) · 2023-11-21
  5. Bank of Israel Circular C-06-2627: Amendments to Proper Conduct of Banking Business Directive no. 450 · 2023-08-13