Refusal of Banks to Issue Checkbooks

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Despite the rise in the use of digital payment methods, checks remain a common means of payment in Israel. There are areas in which it is very difficult to manage without checks, particularly in housing and education (for example, payments to private educational institutions such as kindergartens). A person who has gone bankrupt or who is involved in enforcement proceedings may face various restrictions on their economic activity, such as prohibitions on the use of checks and credit cards. However, a bank’s refusal to issue a checkbook to a customer may complicate their life and prevent them and their family from exercising fundamental rights, including the right to housing and the right to an education.

The Bank of Israel's guidelines outline a process for removing restrictions imposed on debtors, but in practice they are rarely implemented because they contain built-in barriers to their use. Additionally, in many cases banks refuse to issue checks to customers even after a court has ordered the removal of restrictions from their account. As a result, only a minority of requests by debtors to remove restrictions on the use of checks are approved.

For example, according to data received by ACRI, in 2024 only 5 out of 24 requests to remove restrictions on the use of checks submitted in the Tel Aviv District were approved, only 1 out of 14 requests submitted in the Be’er Sheva District was approved, and not a single request of the 19 submitted in the Haifa District was approved. This reflects not only a low approval rate for requests, but also an extremely low number of requests submitted in the first place, all of which were submitted by applicants with legal representation. These figures also point to the barriers facing debtors in Israel, who are often unfamiliar with the procedures and the various options available to them, particularly regarding the removal of restrictions on essential activities.

Following ACRI's Appeal: Bank consent no longer required to submit a request to issue checks

On July 2, 2024, ACRI appealed to the Bank of Israel and other relevant authorities, together with the Human Rights in Civil Proceedings Clinic at the Faculty of Law at the University of Haifa. The appeal demanded changes to the procedure for handling requests by debtors to remove restrictions on the issuance of checkbooks. Attorneys Reut Cohen from the clinic and Maskit Bendel from ACRI noted that the current situation violates human rights, and undermines efficient debt repayment, economic rehabilitation, and the protection of the rights of debtors and their families. It also wastes valuable judicial resources.

We therefore requested:

• That banks be instructed that once there has been a judicial decision removing restrictions on the use of checks, they may not refuse to issue them;

• That a clear directive be issued stating that the issuance of a checkbook is an integral part of managing a current account, and therefore a refusal to issue checks for essential purposes such as rent payments or payments to educational institutions is unreasonable;

• That the issuance of checks for essential purposes be added to the list of services that a bank may not unreasonably refuse to provide;

• That the procedure be amended and the requirement to obtain prior bank consent as a threshold condition for discussing a customer’s request to remove restrictions on the issuance of checks be abolished.

  
  

On September 18, 2024, we received a response from the Ministry of Justice stating that, following our appeal, it had been decided to amend the procedure of the Commissioner of Insolvency so that prior bank consent would no longer be required in order to consider a customer’s request to issue checks.

Appeal by ACRI and the Human Rights in Civil Proceedings Clinic, July 2, 2024 (Heb)

Response of the Deputy Commissioner for Insolvency and Economic Rehabilitation Proceedings at the Ministry of Justice, September 18, 2024 (Heb)

Appeal to the Bank of Israel: Regulate discretion of banks before refusing to issue checks

On May 7, 2026, ACRI, together with the Human Rights in Civil Proceedings Clinic, appealed to the Supervisor of Banks at the Bank of Israel. The appeal requests that guidelines be established to direct banks’ discretion when examining requests for the issuance of checkbooks. We requested that the guidelines ensure that appropriate weight is given to all relevant considerations, including the customer’s need for a checkbook and the harm caused to the customer by the refusal to issue one.

Attorneys Hagar Shechter from ACRI and Reut Cohen from the clinic acknowledged that banks have legitimate considerations to take into account when examining requests for checkbooks, but these considerations must be balanced against the harm caused to fundamental human rights by their refusal to issue one, particularly when it comes to the right to housing and the right to education. Guidelines from the Bank of Israel regarding banks’ exercise of discretion is necessary to ensure the proper balance between the needs of banks and the protection of the rights of customers; to ensure that refusals by banks are reasonable and not arbitrary; and so that there is uniformity in the provision or refusal of checkbooks. When a customer states that the checkbook is needed for essential purposes such as rent or education, a refusal should be considered unreasonable unless exceptional circumstances justify it, such as an overdrawn account.

Appeal by ACRI and the Human Rights in Civil Proceedings Clinic, May 7, 2026 (Heb)

For links to articles written in Hebrew about this issue, see here.

The 2026 appeal was written with the assistance of ACRI legal intern Michele Amzalak