Opening a Bank Account in Israel
This article will discuss opening a bank account in Israel, specifically for an amuta or cheletz (non-profit organizations), as this is the most frequent inquiry we receive regarding bank accounts. We also include links to two videos addressing opening a bank account for non-profits or foreign entities.
When to Open a Bank Account
It is possible to open a bank account for an amuta only after legally registering the non-profit with the Israeli Ministry of Justice. There are four main large banks in Israel: Bank Leumi, Bank Ha’Poalim, Bank Mercantile, and Bank Mizrahi Tefachot. Whether you choose to open an account at one of the larger or smaller banks, the primary tip we can provide is to choose a bank where the account holders or signatories are trusted by the bank managers. When opening a bank account, local non-profits or foreign entities will often have an Israeli signatory for the account, and it’s important to work with people who you know and trust who can help you resolve any issues that might arise during what is often a drawn-out, bureaucratic process.
Challenges with Banks in Israel
Non-profit organizations often have a hard time opening a bank in Israel for two primary reasons: 1) non-profits don’t make banks much money as they do not rely on credit or loans to the same degree as companies, and 2) United States FATCA measures place significant economic pressure on Israeli banks (and other banks worldwide), and these banks can be fined if they do not follow FATCA regulations. Thus, banks can be hesitant to open new accounts for non-profit organizations.
At the same time, in spite of the bureaucratic hurdles, we have successfully opened bank accounts for many local and international organizations. Representatives of the organization need to go to the bank with the organization’s documents of incorporation and provide information on the organization — budget, sources of income, expenses, etc. We provide a long list of documents required in our article Mandatory Paperwork in Israel to Open an Amuta Bank Account.
Opening a Bank Account for a Foreign Entity in Israel
If you require assistance opening a bank account in Israel, please contact us. Advocate Joshua Pex from our office, specializes in non-profit law in Israel, and he has helped many local and foreign entities with all their bank account needs.