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First Digital goes live as Israel's first new bank since 1978

EconomyMar 14, 2021 10:55AM ET
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© Reuters. FILE PHOTO: FILE PHOTO: Amnon Shashua, co-founder of Israeli start-up Mobileye, is seen in Jerusalem

JERUSALEM (Reuters) - First Digital Bank, the first new bank in Israel since 1978, started operations on Sunday on a trial basis, and said it planned to open to the public later in 2021.

The bank, which Israel’s banking regulator approved last year, has 140 staff and has begun opening accounts and providing all banking services for a closed group of customers.

First Digital Bank was founded by Amnon Shashua, co-founder of Intel’s autonomous car business Mobileye (F:0ME). Shashua has invested $60 million into the venture and the bank said it would raise additional funds to expand its operations.

Shashua said the bank will use artificial intelligence and other innovative technologies to meet customer needs.

The bank will have no branches and will focus on retail services, including extending credit to households and accepting deposits. Opening accounts will be done online.

In the third quarter, the bank will offer its services to 1,000 additional customers before opening to the general public towards the end of 2021.

Israel has five main banking groups, led by Hapoalim and Leumi, which together account for more than half of the market.

"We will offer a new model," said Gal Bar Dea, CEO of the First Digital Bank.

First Digital goes live as Israel's first new bank since 1978
 

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Comments (3)
Chris Sundo
Chris Sundo Mar 14, 2021 12:31PM ET
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Chances are the real purpose for the bank is to use depositors' funds to leverage the purchase of bitcoins. If bitcoin goes up and bitcoin investors cash out the bank could become insolvent. Right now bitcoin is a ponzi scheme. Who will provide funding if mass liquidations for stratospheric bitcoin prices become a reality. A mass liquidation would also mean massive declines
Chris Sundo
Chris Sundo Mar 14, 2021 12:31PM ET
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An insolvent digital bank would mean that bitcoin owners become liable for massive income tax debt on the gains but can't pay their tax debt due to an insolvent bank
Ramogi Ochola
Ramogi Ochola Mar 14, 2021 12:31PM ET
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amazing how you don't know how banks work. not a single banking institution the world over has invested a single cent of depositor's money in bitcoin. regulations are in place to prevent such.
puruso pillay
puruso pillay Mar 14, 2021 12:21PM ET
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Security concern easy to hack
Chris Sundo
Chris Sundo Mar 14, 2021 12:18PM ET
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Audited Financials and full security underwritten by regulators a must and be available to every account holder. Nobody should lose their money at pennies on the deposit insured dollar if this digital bank gets hacked or goes belly-up.
 
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