The Israeli payments market is finally aligning itself with many other countries around the world with the launch of Apple Pay in Israel. Simultaneously, Bank Hapoalim (large Israeli bank), which is behind the money transfer app – Bit, announced a new feature that deviates from the standard money transfer option of the application, now allowing users to shop in-store and online.
Digital credit issued in minutes
In 2020, most of the major Israeli credit cards launched a mobile payment option on Anroid-enabled devices, allowing users to theoretically pay through their smartphones. Now Bit is also launching a digital wallet and a semi-digital credit card called bitcard. Bit explains that the new bitcard, issued by Israeli credit card company Cal, can be ordered directly from the app. A few minutes later, the card can be used in stores with registers that support NFC, while the physical card is sent through Messenger.
IPhone users, at least until the launch of Apple Pay scheduled in the coming weeks, can order the physical card through the app in the meantime. According to the iOS changelog, “with the new bitcard you can buy with Apple Pay,” which means Apple Pay will support the Bit functionality.
Mastercard and Isracard holders can also take advantage of the digital wallet with the supporting registers. This adds another player to Isracard and Max’s Anypay, which already offer mobile payment options. Bit told us that the bitcard will be issued with no charge and no card fees while mentioning that the subject will be discussed again in a few years.
The future of Bit
Bit is considered a major player in the money transfer business, with an estimated market share of over 50%. One of the main reasons for the app’s success is the massive subsidies from stakeholder Bank Hapoalim, which does not charge users any fees and grants them various benefits. Bank Hapoalim is estimated to have invested millions of dollars in the app and its promotion, and it sees the app as a future source of revenue.
Despite the advancement of digital payment, it is important to remember that this digital credit card launch is essentially helping to strengthen Bank Hapoalim’s holdings in the Israeli credit card market. Hapoalim Bank has already been forced to sell its Isracard business under free market laws and regulations.