Dropped from the agenda: law which orders banks to pay interest to saving accounts

The bill proposing that the banks will be required to pay interest on the account, which has already passed the committee of ministers and was supposed to go up for a preliminary vote in the plenary on Wednesday, is dropped from the agenda at this stage.
Member of Knesset Yanon Azoulai (one of the bill's presenters), announced that "after consultation with Shas movement chairman Rabbi Aryeh Deri, Prime Minister Binyamin Netanyahu, and coalition chairman Ofir Katz, it was decided to wait with raising the bill, which would oblige the banks To pay interest on the current account balance.

That is until next week, the date when the banks are required to return an answer regarding the Bank of Israel governor's request."
As mentioned, the purpose of the bill that was submitted in light of the many criticisms of the banks' profits from the Bank of Israel's interest rate increases, which were intended to moderate inflation, is to oblige the banks in Israel to pay more interest to their customers and to reduce the gaps between the right interest and the mandatory interest that the banks charge.
The governor himself really did not like the bill, and addressed an urgent letter to Prime Minister Benjamin Netanyahu with the aim of stopping the continuation of its legislation. "I am strongly opposed to intervention in the pricing of banking products and to setting a uniform price," the governor wrote to Netanyahu. "Setting a price harms the activity of the market mechanisms, causes all the players to gather around the set price and thus suppresses competition and efficiency, raises significant practical difficulties with regard to the way the price is calculated and is seen internationally as a negative move that is not appropriate for advanced economies in developed countries.
"I am afraid that this kind of blatant interference in the legislation could affect not only international financial entities that are considering operating in Israel, but also international business entities in other areas of the economy. Focusing the discussion on a single step in the field of current affairs, certainly when it is carried out while interfering with pricing, is not optimal for the customers".
He also wrote that "Furthermore, the proposal according to which the determination of the minimum interest rate on the current account by the Governor of the Bank of Israel is subject to the approval of the Minister of Finance, constitutes a very serious injury to the independence of the Bank of Israel and its ability to manage monetary policy. In this way, the Minister of Finance is given the authority to actually influence the interest rate in the economy and to blatantly interfere in the management of monetary policy and its effectiveness. The violation of the central bank's independence embodied in the bill is crossing a real red line and there is a real fear that the international bodies and the rating companies will also perceive it that way."
Last week, the Governor summoned the heads of the seven major banks to his office and told them that he wanted to act fairly regarding interest payments on current accounts and shekel deposits. However, in order to preserve the independence of the banks, he did not "order" the banks to act, but asked them to inform him Their decision is best made within a week (to date). Following the meeting, Bank Leumi, Jerusalem and Mizrachi Tefahot, as well as Paybox, announced that they would pay a certain interest on the current balance in their customers' accounts.