Bank of Israel Expands Mobile and Partial Branch Services Starting 2027
The Bank of Israel announced that partial and mobile banking branches will offer full services starting in January 2027, while temporary pop-up restrictions will be lifted to enhance accessibility.
The Bank of Israel is significantly expanding the ability of commercial banks to provide services outside fixed branches. Starting in January 2027, partial and mobile branches—currently restricted regarding the types of customers and services they may offer—will be able to deliver all banking services to all customers.
Simultaneously, restrictions on operating temporary branches, akin to banking pop-ups, will be lifted. The 90-day limit on their activity will be canceled, the cap on their number will be removed, and a bank holding the appropriate general permit will no longer need to notify the Banking Supervision department in advance of opening each such branch. This stems from a new policy published by the Banking Supervision department.
Types of Service Points
The new regulations distinguish between three types of service points. A temporary branch—the banking pop-up—is primarily intended for acquiring new customers and, under the new rules, will not become a full branch. Its activity will remain restricted mainly to applications for opening accounts, deposits, credit, charge cards, and document submission.
In contrast, a partial branch operates within a dedicated room bearing bank signage, while a mobile branch is a service point that can be moved from place to place, including via vehicles. The central innovation applies to these latter two: restrictions on service types and customer categories will be lifted, enabling them to provide full banking services.
Banking supervisors noted that experience operating partial and mobile branches has demonstrated their utility among diverse populations, including in nursing homes and peripheral areas, increasing accessibility in settlements with low branch density.
Digital Shift and Demographic Disparities
The relaxations follow an advanced public shift toward direct banking channels. In 2025, approximately 90% of banking transactions were conducted via these channels, compared to 66% in 2019. Among direct channels, 65% of actions were executed using bank mobile apps.
However, the digital transition is uneven. Among individuals aged 71 and older, only 30% of transactions via direct channels utilize apps, compared to roughly 67% among customers aged 25 and younger.
"The Bank of Israel expects banks to ensure adequate physical service deployment with explicit consideration for the elderly, people with disabilities, residents of the periphery, and populations with low digital literacy," banking regulators emphasized.
Against this backdrop, the supervisor is sharpening the reverse side of the policy. Existing Proper Banking Management Directive 400 already mandates bank boards to establish branch deployment policies that account for customer needs, demographics, and geography, ensuring proper service alongside the shift to direct banking.
Branch Statistics and Regulatory Adjustments
The number of bank branches in Israel is no longer shrinking at the rapid pace characteristic of the previous decade. At the end of 2025, Israel had 959 operational branches, comprising 902 permanent locations and 57 partial and mobile units. Following a downsizing trend that began in 2013, branch counts have stabilized relatively since 2021.
Nevertheless, not every branch provides the full service basket traditionally expected: only about 32% of branches offer teller services, while roughly 59% provide mortgage services.
The circular also includes the cancellation of a long-standing permit allowing branch relocation within a 500-meter radius. However, regulators explained this does not represent a tightening on branch closures; such relocations already required formal requests to close existing branches, rendering the old permit obsolete under current legal provisions.
