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This article will be of interest to entrepreneurs willing to set up a fintech firm in Israel. Today, an estimated 400 Fintech companies successfully operate from Israel. All of them rightfully rely on Israeli disruptive technological advances. Many financial institutions have created internal innovation departments and actively introduce financial technologies such as big data analytics, electronic document flow based on blockchain, machine learning. Other companies open local R&D centers to penetrate the Israeli ecosystem, as well as starting business technology accelerators, innovation laboratories. However, it is noteworthy that the level of penetration of fintech-based innovations into the local retail market is quite low. 

Without supervision

The regulation of the fintech industry in Israel was initially less conservative than in the EU. Israeli authorities preferred not to interfere in the development of the fintech market due to the desire to stimulate innovation.

Crypto-landscape in Israel

Digital currency transactions in Israel include the issuance, exchange, storage, transfer, marketing of virtual currencies. So far, such activities are not subject to regulatory control. However, local authorities are taking active steps to create mechanisms of supervision over this kind of activity which is gaining popularity day after day. Even now, one will need to get authorized if they are willing to provide virtual asset services in Israel. Cryptocurrencies in Israel can be considered securities, therefore operations with them are governed the same way as securities. 

Technology transforming lending marketplaces

Today, there are 35 alternative lending startups in Israel that enable merchants to offer real-time financing options to their clients, and their number is growing every month. 

Using modern technologies, banks are expanding the range of services offered, developing non-physical service channels, developing new methods of working with customers. This can be, for example, opening an account without the customer visiting the bank's office and simplifying a number of operations.

Legal framework governing the raising of capital and debt through crowdfunding is well established in Israel. Online platforms need to license their activities as crowdfunding platforms.

Data-driven investment management 

Providing investment services using fintech in Israel is defined as using an algorithm to make decisions without interacting with the human factor. This activity must be licensed in accordance with the Regulation on Investment Consulting, and Portfolio Management

Experienced specialists of our company offer consultations and provide comprehensive legal assistance at all stages of a fintech company set up in Israel. For a good start, you can sign up for a consultation on fintech regulation in Israel. Do not hesitate to ring us up or fill out the form below for a quick connection.