Israeli Business Clearing Tariffs Rise Amid Tensions Over Infrastructure Fees
Credit card clearing tariffs and terminal fees for Israeli businesses rose this week, sparking tensions between financial firms and transaction infrastructure provider Sheba over rising operational costs.
Business operations in Israel became more expensive this week as the first phase of an update to payment card clearing tariffs took effect. The monthly fee for a smart card reader (PinPad) rose from ₪6 to ₪8.75 before VAT, while the terminal fee decreased from ₪14.5 to ₪13. Starting in January, the PinPad price will increase again to ₪11.5, and the terminal price will drop to ₪11.5. The overall impact depends on the number of terminals and payment stations a business maintains.
The Ripple Effect Across the Payment Chain
These adjustments follow a price revision announced last summer by Sheba (Automated Bank Services), the publicly traded company operating Israel's core financial transaction infrastructure. Sheba raised several system-wide services utilized by credit card companies, including a 38% increase in authorization request tariffs and a massive surge in ATM clearing fees.
Monopoly Concerns and Regulatory Tensions
Credit card companies criticized the hike, appealing to Bank of Israel Governor Prof. Amir Yaron to intervene and halt the updates. They argued that Sheba is leveraging a monopolistic position despite robust transaction growth of 7-8% annually. Sheba defended the price adjustments, citing critical investments required to secure national payment infrastructure against rising security threats and surging digital wallet volumes exceeding 20,000 transactions per minute.
