Expand the investment option in the product “Investment camel“.
Raise the annual deposit threshold to NIS 250,000 per person.
Allow banks and credit card companies to market the product.
The Securities Authority opposes.
The Chamber of Insurance Agents object.
The Capital Market Authority is promoting the investment program for an investment provident product and is currently working to increase the volume of possible investment in this product for a deposit of up to NIS 250,000 per person per year. The product has one clear advantage and that is the possibility of not paying capital gains tax if the investor transfers the capital at retirement age (60) to a pension plan and a transition without tax events between investment tracks. At the same time in order to encourage competition and also probably to get the blessing of the Securities Authority or at least blunt its opposition, banks and credit companies will be allowed to market the product (it is not clear how credit companies will market such a product without advice but maybe they will enter the consulting field? A question we will try to answer later). From insiders, it seems that there is still opposition in the Securities Authority to the issue.
The body that most opposes the issue and in this matter integrates with the opposition of the Securities Authority are members of the Chamber of Insurance Agents who issued a statement last night in this language:
“It is not clear why the Capital Authority is having such an important and significant discourse on the savers in Israel, without consulting the Bureau of Insurance Agents as a key player in marketing these products to the public. It seems that this is a regulatory war whose results will be paid by the general public.
Even today, the bank is marketed as a provident fund and continuing education advisor, and it seems that there is an intention to provide banks with additional means of saving for the public’s available money, in a way that raises the question of how such a move, which leaves money under bank control, contributes to increased competition.
Is the goal that more free money will remain in the hands of the banks? This is a distribution of a product that will be particularly significant, easy and material in light of the blessed intention to raise the deposit ceiling in the provident fund channel for an investment of NIS 250,000. Moreover, who will prepare an orderly justification document for the client, who will deploy the alternatives if not the professional insurance agent
The Knesset of Israel has already clearly stated that there is no room for leaving the savings in the banks and the savings must be distributed, this week the credit facilities of the large banks’ customers have been reduced in order to reduce concentration and here, they want to turn the wheel back, without any business reasoning.
The question arises, who will give the right advice to the public that the Capital Market Authority is so anxious about. In marketing policies by corporation insurance agencies owned by credit companies, the bureau was forced to go to court. We believe that such a move should be made in depth, in conjunction with The public of insurance agents, and not out of other considerations.
We can only regret that the Authority, in its view, engraves on its banner the principle of competition, but this without supervising the totality of its consequences and centralization which is an outgrowth of these moves.
We are studying the issue and are waiting for data from the Capital Market Authority. “
The status of the Chamber of Insurance Agents is unclear. They cannot prevent the move and all they have left is to try to influence Knesset members not to approve the move and this is not a simple task at all. Therefore, our expectation is that the move will pass even if such and such changes are introduced.