Supervisor of Banks, Yoav Lehman, is drafting new guidelines for banks that will reduce drastically the availability of overdrafts on current accounts for small- and medium-sized enterprises (SMEs) and individuals.
Lehman informed the Knesset Economics Committee of the draft guidelines on Tuesday (21 October), at the end of a hearing on the subject of the rise in overdrafts. Nevertheless, he stated that he did not intend to ban overdrafts completely, as is the practice in the US for example, but only to prevent unrestrained excesses over authorised credit limits, other than occasional breaches.
Lehman said that excess overdrafts on current accounts of SMEs and individuals presented no threat to the stability of the banks, because the total amount in question was not more than NIS 10bn, and in fact amounted to only a few billions.
