Israelis have increased their credit card spending by 6.2% since last year, with credit card transactions in Israel totaling NIS 41.2 billion in July 2023, according to Shva, the payment processing company that handles all credit payments in Israel.
Israeli credit transactions totaled NIS 38.8 billion in July 2022, meaning transactions have increased by NIS 2.4 billion annually.
The shift to credit and digital transactions comes as technology continues to take hold in aspects of everyday life – for example, online transactions reached a record NIS 24.1 billion in July 2023, an 8.2% increase from the NIS 22.3 billion spent in July 2022.
The increase in credit card spending corresponds with the decrease in the Israeli public’s use of cash, as Shva also noted a 5.5% decrease in cash withdrawals from bank ATMs compared to last year.
Israeli spending undergoes digital shift
Since the outbreak of the pandemic, credit cards have become the most common payment mechanism in Israel, and cash usage declined. Further, Israeli law limits the size of cash transactions to NIS 6,000 for businesses and NIS 15,000 for private individuals.
Online transactions rose 25% from 2020 to 2021, largely due to changes in consumer habits caused by the coronavirus pandemic.
“We see the increase in credit card spending in all the main consumption sectors of the Israeli economy – the food sector, including restaurants and cafes, clothing and footwear and electricity and electronics,” said Shva VP Tali Hollenberg.
While physical cash transactions in Israel give way to digital credit card transactions, much is made about the modernization of commerce. However, Israelis still saw an increase in physical transactions – even if those were made via credit card.
The volume of purchases in physical transactions in Israel increased by 3.47% compared to last year, as Israelis spent NIS 17.1 billion in physical credit card transactions in July 2023 – compared to an amount of NIS 16.5 billion in July 2022.
Zev Stub contributed to this report.