Four FinTech Products We Need in Israel (But Can’t Get)!

After spending a couple of hours attempting to resolve a credit card related debacle (see my note about the potential perils of online shopping here), I was reminded that the internet is still awash with fraudsters posing as legitimate companies and that credit card details should only ever be provided to companies that you know and trust.

If you do end up with a disreputable operator, you’re in a world of pain — and potentially unjust charges.

Although this may seem like a truism to most, it still comes as something of a shock to me.

As I wrote in an updated introduction to that post, I have been shopping online since at least my mid-teens — buying SAT preparation books from Amazon way before that was a mainstream thing to do.

I have always fervently believed that shopping online is inherently safe. That the democratization that things like online reviewing platforms have brought means that it’s no longer possible for companies to simply do nefarious things like gratuitously refuse to cancel your account — and to do that to multiple customers who all post about it online — and to still be able to get away with it.

WRONG!

Beyond the imagined protection of the community (which can, as I well know, be countered with misinformation and bought positive reviews), I assumed, I think, that some benevolent Internet-Regulator-At-Large would step in to bust up the baddies.

I’m sorry to break it to you — no such force exists.

Searching for ways to avoid a repetition of this mess, this led me to conveniently discover another great FinTech product that I wish we could avail of in Israel.

So it’s a good jumping off point for this post.

(Why do these products seemingly take a long time to arrive here, you may be wondering? Israel is a world center of high-tech but it’s a small market in the grander scheme of things — and regulation can be notoriously burdensome).

(All information correct, as always, only as of the time of writing).


Privacy: Per-Transaction Virtual Payment Cards

Agh, I was so excited!

The Israel problem: US residents only.

A virtual credit card looks and functions like a physical credit card — except that you don’t receive a physical piece of plastic.

I first became interested in the concept when I learned that I could avail of a virtual credit card that I could fund by transferring in Bitcoin — but spend as fiat, allowing me to instantly cash in on the (then) rapid appreciation of the cryptocurrency. Regrettably, such cards soon began shutting down their debit card operations and I haven’t looked into the situation in a while.

Privacy.com allows you to create multiple virtual credit cards per month — and tie them all to any US-based checking account. The benefit in light of my anecdote above? You can provide a merchant with these and simply cancel the virtual card (or devise it as a single-use card, or set a spend limit).

This allows you to never risk giving one merchant access to your one and only payment card — or, depending on your level of trust, from any merchant at all.

There’s even a free tier which allows you to maintain up to twelve cards per month.

If you upgrade to the Pro plan, you can create 36 such cards — which should be a comfortable number for most needs.

I’ve talked before about the value of using Cloudflare to proxy your web server’s actual IP addresses. It’s a rough analogy, but this seems sort of like the credit card equivalent and fits in nicely with the general worldwide trend of decentralization and an erosion of societal trust.

Unfortunately this Reddit thread indicates that there are no alternatives — even in Europe. I hope that changes soon.


Revolut: Free Currency Exchange


Israel problem: European Economic Area (EEA) residents only.

Israel’s national currency is the New Israeli Shekel (I typically denote it as NIS, as do many, although ILS is actually the official currency abbreviation as set down in the ISO standard).

As a minor world currency, this means that a sizable amount of one’s purchases that do not involve acquiring lentils or falafel will involve foreign exchange — typically charged at your card issuer’s lousy buy rates.

By contrast, Revolut:

  • Offers its users the interbank rate in over 150 world currencies.
  • Covers £200 a month in international ATM withdrawals for free

Friends have reported that it’s possible to obtain cards by sending them to an address you have in an EEA country — assuming you have a European passport to verify yourself with, of course.

But what can I say? I’m a straight shooter.


Curve: My Last “Genius Business Idea!


Israel problem: Curve is currently available within the 31 European Economic Area (EEA) countries. Regrettably, this Association does not include Israel.

Every now and again I come up with a “genius new business idea” that turns out to have been invented several months or years previously. I generally take these as somewhat encouraging signs that I continue to have somewhat viable sparks of innovation swimming around my head — before then proceeding to bang said head against the table in frustration.

This summer, I lost my credit card. I would love to tell you that it had been years since the previous incident, but in reality it was about six months. Maybe my cognition had been adversely impacted by the last time I realized my “genius business idea” had been taken.

Having just been through the time-consuming ordeal of manually updating what seemed like a million online account areas, direct debits, and other such inconveniences, I was dreading the experience.

Then, a flash of inspiration struck, and after spending all of five minutes on Google I dashed off the following email to my trusted business criticism advisory pool.

A few hours later I of course received:

Apparently over 600,000 people have signed up for the Curve payment card which — as my genius idea suggested — aggregates multiple payment cards and allows you to manage them through a mobile app.

The details of what Curve does don’t need repeating here, but it’s truly something that would open up possibilities.

Rich irony: Curve’s CEO, Shachar Bialick, is orignally from Israel!


Better TransferWise: ILS -> * And Debit Card

Ah, to transfer shekels out!

I’m a massive fan of TransferWise and far prefer it to Payoneer’s clunky user interface. Their support is also fantastic and using its virtual / Borderless accounts truly inspires me to “think globally” when envisioning what clients, and currencies, I can work with.

Unfortunately, the service’s utility for Israelis consumers is hampered in two important respects:

  • Transferwise does not support outbound (shekel -> *) transfers.
  • The Transferwise Mastercard® — which allows you to spend your Borderless account holdings, or get low cost conversions, and receive  £200 a month in complementary exchanges fees is not available in Israel yet.

Israel problem: The list of countries the Transferwise Borderless card is available can be found here. It includes the EEA member states plus the US and some other anomalies (that are less anomalous when one considers they are major world finance centers).


Times Are Changing


I’ve recently authored a few posts about Amazon’s entry to the Israeli market — at least by offering free shipping between certain order values.

I hope that as more and more international companies continue to explore the Israeli market that the regulatory authorities will, in turn, make it easier and more enticing for them to do so.

Israel’s banking sector is notorious for levying extortionate fees on its customers — and credit card issuers offer marginal benefits compared to international franchisees.

If the disruption of the cellphone market and the revolution in flight ticket prices that the Open Skies Agreement heralded have taught us anything, it’s that even the most stifling monopolies can be disrupted — if there’s a will to change them. Hopefully the consumer finance sector will be next in line.

Thank you for reading!