Banking at the Post Office
The Israel Postal Bank, incorporated as a subsidiary of the Israel Postal Bank has been renamed as of 2006, the Postal Bank Company Ltd1. It is supposed to be a bank like any other, but is it really a bank like any other? The answer is: NO. All financial services in the bank are supervised by the government and these services incur VAT charges.
What you CAN DO through the Postal Bank if you are an Account Holder
Issue a check. Please be aware that most of the commercial establishments in Israel will not accept a check from the Postal Bank. Why is that so? It is a practical and also an historical issue. In the past Israelis with “problems” used this type of account when they could not qualify to open a regular account in a commercial bank. As a result, if you had an account in the Postal Bank, you were considered a “bad client” so to speak.
The situation has changed and the laws have changed but the “bad name” still sticks.
Another reason, and the real one, is due to the fact that the Postal Bank will give no credit at all, as in the U.S for example. If you are short even five shekels from the amount you just wrote on the check, the check will be bounced. Nobody will call you beforehand and the postal bank will do what it is supposed to do!
You can receive a Credit Card (sort of) through Visa CAL.
You can access your account from any post office branch but be aware of the long lines because the clerks serving the postal bank are the same clerks selling stamps, accepting bill payments, etc. You can also access your account via the WEB or by phone.
There are no fees in the Postal Bank but checkbooks cost money.
What you CANNOT DO through the Postal Bank even if you are an account holder
You won’t be able to have any personal relationship with a banker as you can in the bank. There is no specific clerk taking care of your account. There is no “branch” and the account is managed in the central Postal Bank.
You cannot open a savings account, pension fund, deal with stocks, etc. It is a very simple checking account.
You won’t have any “credit frame”. Whatever cash you have is what you can use in that same moment.
What you CAN DO through the Postal Bank even if you are Not a Client
- Buy and sell foreign currency (commission free but is very advisable to check the rates somewhere else before the transaction – look for discrepancies in the rate).
- Receive a refund on car license payments, (only for individuals and not corporations) if your car was stolen any time since 1994.
- Purchase foreign currency and travelers’ checks including (American Express) U.S dollars or Euros. Banknotes may be purchased in cash or by credit card (Isracard or American Express) up to $ 1,000 (a fee is charged by the credit card company and the card is debited immediately).
- Convert travelers’ checks2.
- Issue money orders in Israel (also called postal checks)3. This service allows you to sell and cash in postal checks that are issued for various sums at the request of the customer, via an online process. The checks can be cashed in three ways: 1: Cashing the checks in cash at online branches. 2: Depositing the sum into the beneficiary’s account at the Postal Bank in all branches. 3: Depositing the sum into the beneficiary’s account in another bank.
- Send or receive money to or from abroad using Western Union International Money Transfer Service4.
- Pay for an American Visa application or acquire a PIN code to Schedule an Interview with the American Embassy/Consulate in Israel (Jerusalem and Tel Aviv)
Sincerely,
Tzvi Szajnbrum, Attorney at Law
1 Due to the amended Postal Law, financial services will be provided by the Israel Postal Company Ltd on behalf of its subsidiary the Israel Postal Bank Ltd.
2 In the following currency only into shekels: United States dollar, Euro, Canadian dollar and Japanese yen
3 1. Postal checks are personal, for the beneficiary only, and are valid for sixty days from their date of issuance.
2. Postal checks are personal and cannot be endorsed. Payment for postal checks is in cash only.
3. Postal checks issued in the name of a company cannot be redeemed in cash, and may only be deposited into the account of the beneficiary.
4 Another service is the quick payments to /from the U.S , Canada, Europe.