*In the frame, a poster for the campaign to abolish current account fees, being run by the Israel Consumer Council, under the slogan "The Banks are Milking Us".
On 13.12.2011, a bill was submitted to the Knesset to regulate bank current (checking) account fees. The bill, whose lead proposer is Knesset Economic Affairs Committee chairman, MK Carmel Shama Hacohen, was also signed by the chairpersons of other Knesset committees, heads of Knesset factions, and other Knesset members.
In 2010, the Israel Consumer Council led a public and legislative campaign to abolish checking account fees. The Ministerial Committee on Legislation instructed the Supervisor of Banks to hold discussions with the Council, with the aim of finding an agreed-upon arrangement. During 2011 the parties met, but the Bank of Israel remained steadfastly opposed to resolving the problem. In light of this, the Consumer Council has recommenced, in the present Knesset sitting, its campaign to resolve the matter through legislation, with the strong support that it has received from the general public: 870,000 consumers have demanded, through the Consumer Council, that the Knesset’s Economic Affairs Committee and the Supervisor of Banks regulate this area.
This time, the proposed law is based on three principles:
1. Banks are entitled to collect payment for services that they provide.
2. Consumers should be able to compare the costs of banking services among the various banks.
3. A bank should not collect current account fees if it also profits from the account in another way.
Accordingly, the new bill states:
1. A current account that has a credit balance, or a minimal debit (overdraft) balance, will be exempt from payment of fees.
2. The Supervisor of Banks will determine the credit balance and minimal debit balance that entitles the customer to an exemption from paying checking account fees. These sums will be uniform across all the banks.
3. The minimum fee will be abolished, since it is a fee for “inactivity.”
Chairman of the Knesset’s Economic Affairs Committee, MK Carmel Shama Hacohen, stated: “Once the banks exempt organized, powerful groups from payment of current account fees, they are themselves acknowledging that it is possible to provide service to customers without a fee for each and every transaction or entry.”
CEO of the Consumer Council, Advocate Ehud Peleg, said that abolition of the fees for current account transactions will make it easier for the consumer to focus on the main cost of banking services – the interest rate (on both credit and savings) – and will allow him to make comparisons among the various banks, Current account fees constitute an illegitimate source of double profit to the banks from accounts held with them, and serve the banks as a “camouflage net that prevents comparison” in relation to the level of interest rates between the various banks. Abolition of the current account fees will remove this obstacle, and will give the public the ability to make comparison; this will give back to the public the power to bargain with the banks.
The bill was signed by Knesset members from all parties, from both the Coalition and the Opposition:
MK Carmel Shama Hacohen, Chairman, Economic Affairs Committee
MK Moshe Gafni, Chairman, Finance Committee
MK Amnon Cohen, Chairman, Internal Affairs and Environment Committee
MK Alex Miller, Chairman, Education, Culture and Sports Committee
MK David Azoulay, Chairman, Public Petitions Committee
MK Zevulun Orlev, Chairman, Committee on the Rights of the Child
MK Dov Khenin, Chairman, Joint Committee for Health and the Environment
MK Yitzhak Vaknin, Deputy Speaker of the Knesset
MK Uri Orbach, Chairman, Habayit Hayehudi
MK Ilan Gilon, Chairman, Meretz
MK Einat Wilf, Chairperson, HaAtzmaut Faction
MK Uri Ariel, Member of the Finance Committee
MK Amir Peretz, Member of the Economic Affairs Committee
MK Hamad Amar, Member of the Economic Affairs Committee
MK Nachman Shai, Member of the Economic Affairs Committee
MK Zeev Bielski, Kadima
MK Yulia Shamalov Berkovich, Kadima
MK Eitan Cabel, Labor
MK Yoel Hasson, Kadima
MK Miri Regev, Likud
MK Zahava Gal-On, Meretz