Regulatory AlertsPalestine: lending & credit regulation
RegulatedLending monopolized by PMA-licensed banks & SLIs; no independent fintech credit regime
- Lead regulator
- Palestine Monetary Authority (PMA)
- Also involved
- None identified
- Core law
- Banking Law No. (2) of 2002
- Entry capital
- —
- Approval timeline
- —
- Customer assets
- —
- Data protection
- —
- Sandbox
- No
The Palestine Monetary Authority (PMA) strictly regulates all credit granting through licensed banks and Specialized Lending Institutions (SLIs). There is no independent regulatory framework for non-bank fintech lenders, P2P platforms, or Buy-now-pay-later providers; such activities are effectively restricted to the licensed banking sector. Recent regulatory activity focuses on debt restructuring, credit classification, and consumer protection within this traditional banking framework.
Which licence do you need?
| Your activity | Requirement | Capital | Timeline | Authority |
|---|---|---|---|---|
| Consumer lending | LicenceBanking or SLI License[1][2] Only licensed banks/SLIs can offer consumer credit | — | — | PMA |
| SME / commercial lending | LicenceBanking or SLI License[3][4] SLIs specifically target SMEs under PMA supervision | — | — | PMA |
| Microfinance | LicenceBanking or SLI License[4] Micro-lending restricted to licensed institutions | — | — | PMA |
| Buy-now-pay-later | Uncertainverify with regulator No specific BNPL regime; likely requires banking license | — | — | — |
| P2P lending platform | Uncertainverify with regulator No P2P lending framework identified | — | — | — |
| Credit bureau / scoring | Uncertainverify with regulator Credit reporting is internal to banks; no independent bureau license known | — | — | — |
| Debt collection | Uncertainverify with regulator No specific debt collection agency licensing identified | — | — | — |
New — what changed recently
- 2026-01-01Instructions No. 3 of 2026 — Amended credit granting controls to prohibit certain secured/unsecured credit to subsidiaries and distressed debtors.
- 2025-01-01Law No. 3 of 2025 — Regulates loan maturities and installments to protect customers and ensure financial stability.
- 2025-01-01Instructions No. 2 of 2025 — Updated loan portfolio classification thresholds for non-performing loans.
Market-entry checklist
- 1Secure PMA Banking LicenseObtain a banking or Specialized Lending Institution license from the PMA to legally originate credit.
- 2Meet Capital RequirementsVerify statutory minimum capital for the specific license tier with the PMA (amounts not specified in source docs).
- 3Implement Credit ClassificationAdopt the PMA's Borrower Classification System (Version V) and provisioning rules.
- 4Comply with Responsible LendingAdhere to PMA Instructions on Responsible Lending, including debt-to-income limits and disclosure.
- 5Establish Credit ReportingIntegrate with the PMA's Credit Information System for reporting and querying borrower data.
Sources
- High Authority - 2020 - Instructions No. 36 Regarding Early Repayment of Financing · 2020-09-09
- Instructions No. 2 of 2022 Regarding the Protection of Customer Rights · 2022-03-23
- Palestine Monetary Authority Circular No. 15/2025: European Investment Bank Loan · 2025-04-22
- Instructions No. (1) of 2022 Concerning the Provision of Financing to Specialized Lending Institutions · 2022-04-14