Israel Discount Bank Ltd. and the nation’s largest supermarket chain, Shufersal, said on Wednesday they are setting up a joint venture to offer a digital financial services that aims to compete with the traditional banking system, offering customers loans, savings products, and tools for financial planning.
As part of the deal, which the two companies announced in a statement and in filings to the Tel Aviv Stock Exchange, where their shares are traded, the PayBox digital wallet of Bank Discount will become a separate company, jointly owned by the two partners.
Discount Bank will hold a 50.1% share in the joint firm, and Shufersal 49.9%, the companies said. The new company will operate on the existing platform of PayBox, and will offer advanced digital wallet services. In the future the firm will become a “financial supermarket” that will compete with existing lenders, including Discount.
The new firm will offer financial services and tools of a variety of fintech companies to the 1.5 million PayBox customers, to Shufersal’s 2 million Customer Club members, and to customers of all other banks, the statement said.
The joining of forces will enable “real competition in the traditional banking system,” the two companies said in the statement, and is a “leap forward in Shufersal’s involvement in the financial field.”
The step is also part of Discount Bank’s strategy to expand its activities with customers of all banks “and to be a leading and competitive factor in the banking market,” the statement added.
The transaction is subject to the approval of the Bank of Israel and the Israel Competition Authority.