A private bill that would boost banking fee regulation for household and small business customers stands in the shadows of today's scheduled Knesset hearing on its parliamentary inquiry committee's report on banking fees. The bill, submitted in May by MKs Amnon Cohen (Shas) and Gilad Erdan (Likud), is expected to go through its first reading in the near future. The Knesset is awaiting a similar bill from the government.
The committee recommends removing regulatory authority over banking service fees from the supervisor of prices in the Industry and Trade Ministry and anchoring it in legislation. The committee believes if the Bank of Israel focuses on regulating a limited number of fees, the matter could be resolved until steps are taken to increase transparency and competition, which would alter the status quo.
"Due to the fact that the problem of concentration and lack of competition is not resolvable in the short term, the inquiry committee believes the benefits of regulating prices of some fees outweigh the disadvantages," the committee concluded.
While the committee suggests the Association of Banks come to a voluntary arrangement with the Supervisor of Banks similar to banking systems abroad, which would make legislation less necessary, Knesset officials do not see such a deal in the offing. Thus, they are proceeding with the legislative process to resolve the issue.
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