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Program to help credit card customers deal with the ramifications of the “Swords of Iron” war

Outline for bank customers

FIRST-DEGREE CUSTOMERS

Group of customers*

  • Group 1
    Group 1
    Living within a range of up to 30 km from the Gaza Strip**
  • Group 2
    Group 2
    evacuated from home by official agencies, as of the 14.10.2023 **
  • Group 3
    Group 3
    First degree relatives of those killed or abducted during the war or of those missing***
  • Group 4
    Group 4
    4. Those serving in the reserves and those mobilized through an emergency call-up***

How to obtain information on which group you belong to:
 *Individuals, and small businesses with an annual settlement turnover with the credit card company of no more than NIS 2 million, who fall within one or more of the stated population groups.
** According to the list of localities sent to the credit card companies by authorized entities.
*** Based on a customer declaration or presentation of appropriate documentation, in accordance with the company’s decision.  With regard to small businesses, in accordance with the details published by the company.

The period for submitting a request to defer loan payments is until December 31, 2023.

Leniencies in credit and Fees

 

  • Cumulative consumer credit up to NIS 100,000

    • Payment delay period - Three months[1] (After this period, a further extension will be considered)

    • Maximum interest rate - No interest cost in respect of the delayed amount

    • Fees – No fees will be charged for the deferral

    • How the payments are spread out - Adding the payments at the end of the loan period[2]

  • Cumulative business credit[3] up to NIS 300,000

    • Payment delay period - Three months (After this period, a further extension will be considered)

    • Maximum interest rate - No interest cost in respect of the delayed amount

    • Fees – No fees will be charged for the deferral

    • How the payments are spread out - Adding the payments at the end of the loan period[2]

  • fees:[4]

    Blanket 3-month exemption from fees in respect of transactions made by first-degree customers, other than transactions involving foreign exchange or foreign trade (as detailed in the footnote).
     

Comments:

[1] Referring to interest-bearing loans.
[2] The loan repayments will be spread out subject to the technical limitations derived from how this outline is implemented.
[3] Excluding loans in commercial cooperation with a third party.
[4] A negative balance that is part of the credit facility approved by the bank.
[5]The fees that appear in the following sections of the Banking (Service to the Customer)(Fees) Rules, 5768-2008:
     Section 2 – Information, notices, and warnings (in its entirety)
     Section 3 – Credit (in its entirety)
     Section 6 – Credit cards (in its entirety, excluding fees – (7) foreign exchange transactions, (8) foreign exchange withdrawals abroad, (9) foreign exchange purchases from a money changer).  Exemption from credit card fees may be given from December 2023 (in respect of charges from November), provided that the benefit is given for an actual 3-month period.

 

 

 

SECOND-DEGREE CUSTOMERS

All other credit card customers

Leniencies in credit and Fees

 

  • Cumulative consumer credit up to NIS 100,000

    • Payment delay period - Three months (After this period, a further extension will be considered)

    • Maximum interest rate - Interest rate in the agreement[1]

    • How the payments are spread out - Payments will be added at the end of the loan period[2]

  • Cumulative business credit up to NIS 300,000

    • Payment delay period - Three months (After this period, a further extension will be considered)

    • Maximum interest rate - Interest rate in the agreement[1]

    • How the payments are spread out - Payments will be added at the end of the loan period[2]

  • Fees

    Payments will be delayed without fee charges.

Comments:

[1] Delaying payments involves interest for the period of the delay.  Therefore, before making a decision to delay payments, it is important to examine the implications of the delay, including the economic price of the delay (in terms of the interest cost, the monthly payment following the delay, and so forth), in order to make an informed decision.
[2]The loan repayments will be spread out subject to the technical limitations derived from how the outline is implemented.

 Clarifications:

  • This outline will take effect no later than October 31, 2023, in order for each credit card company to prepare properly, and will last for the period allocated in the outline from the date it actually takes effect. Insofar as the implementation of the outline requires an enquiry from the customer, requests submitted by December 31, 2023 will be accepted. If necessary, an extension of these dates will be considered.
  • In order to delay payments, the customer must contact the credit card company and submit a request in the manner determined by the company. With regard to fees, insofar as it is possible to make a customer-initiated enquiry unnecessary, this should be prioritized.
  • This outline does not apply to borrowers in the midst of legal proceedings or borrowers in arrears for a period of more than 2 months.
  • The company may announce a freeze in all or part of the outline, except for customers regarding which the outline has been implemented at the time of the announcement. The company shall update its customers of such an announcement accordingly.
  • This outline presents the minimum conditions, and each bank is permitted to expand upon it to benefit its customers and at their request.