Tel Aviv, July 23, 2025 – Israel has granted four international fintech firms—Revolut, Rapyd, Airwallex and Mesh Payments—payment licences to operate in the country, as part of ongoing efforts to open the local financial system to non-bank competition.
The approvals were announced this week by Israel’s Capital Markets Authority, and follow a policy shift by the Bank of Israel allowing licensed payment institutions to pay interest on customer deposits—previously a right reserved for banks.
The licences allow the firms to offer digital wallets, execute foreign exchange services, process payments, and hold customer funds. Lending and securities activities remain restricted and require separate authorisations.
The four firms had previously operated in Israel on a limited basis. Revolut, for instance, received an identification code from the Bank of Israel in 2023, enabling it to provide money transfer services. The new licence expands its local capabilities significantly.
The licensing process was enabled by recommendations from the Committee to Increase Competition in the Banking and Financial Sector, which urged the government to lower structural barriers for non-bank institutions. In response, the Ministry of Finance pushed for regulatory amendments earlier this year.
The Bank of Israel initially opposed allowing payment firms to offer interest on customer balances, citing concerns over regulatory arbitrage. The central bank later revised its position following cabinet-level discussions and in coordination with the Ministry of Finance. In a statement in April 2024, Israel’s Ministry of Finance said the change would “increase competition in the financial system and reduce household costs,” describing it as a “necessary correction to enable innovation.”
Companies granted licences
Revolut, the UK-based fintech with over 60 million users globally, began operating in Israel in 2023 after receiving an identification code from the Bank of Israel, allowing it to process local payments. The new licence expands its permitted activities to include holding customer funds and executing foreign exchange. Revolut is also seeking a lean banking licence that would allow it to offer deposit and credit services.
Rapyd, founded in Tel Aviv and now headquartered in London, has described its mission as building a “full-stack financial infrastructure for global commerce.” The company has advocated for expanding non-bank access to payments but has not issued a statement on its new licence in Israel.
Airwallex, which opened its Israel office in 2023, said in an April 2025 press release: “We’re excited to deepen our footprint in Israel… Businesses can now collect, hold and pay in ILS using local rails, enabling faster and more cost-efficient payments.”
Mesh Payments, headquartered in New York with Israeli founders, offers virtual cards and spend management tools for corporate clients. The company was included among the firms granted a local payment licence but has not commented publicly on its operational plans in Israel.
The decision is likely to place renewed pressure on Israel’s incumbent banks, particularly in the SME and cross-border payments space. Firms like Revolut and Rapyd are expected to leverage their global platforms and digital onboarding tools to gain share among underbanked or digitally active customers.
Under the current framework, licensed payment institutions must comply with customer fund segregation rules, anti-money laundering requirements, and regular financial reporting. They are supervised by the Capital Markets, Insurance and Savings Authority rather than the Bank of Israel.
