Means of payment in Israel

The general public can execute payments in Israel using cash, checks, electronic debits, payment cards, account debiting authorizations, payments via the Internet and by telephone, and more.

The following are the main means of payment in Israel:

  • Cash - notes and coins, which are the most liquid means of payment.
  • Check - a document in which a person ("the payer") instructs the bank at which he
    manages his account, to pay money from his account to a third party ("the beneficiary")at a predetermined time. The check, as a document, can be endorsed (unless the payer restricts his endorsement on the check, and the legal conditions permitting this have been fulfilled), and in such case the endorsee (the person to whom the check has been endorsed) can demand redemption from the payer or from the endorser.
  • EFT (Electronic Funds Transfer) - electronic funds transfer from a payer to a recipient by means of communication between information systems, without physical transfer of paperwork, banknotes, or checks. A ZAHAV transfer (see below) and a transfer via MASAV are examples of this means of payment in Israel.
  • ZAHAV transfer - an electronic transfer executed via the ZAHAV system during the business day, usually within a few minutes. A transfer of this type is final and irrevocable.
  • Payment cards - There are various forms of payment cards used in Israel:
    • Debit card - a means of payment that is used as a substitute for cash and checks. When paying by means of a debit card, the payer presents the card or gives his details. The supplier or payment recipient contacts the clearing house, which sends him the payment and debits the customer.
    • Credit card - a type of payment card that is used as an alternative means of payment to cash.  The customer is usually charged for the transaction at a date later than the transaction date.
    • Pre-paid card - a type of payment card, which has to be charged in advance with the maximum amount for debiting. Each payment is deducted from the customer's balance until the balance reaches zero.