FILM PHOTO: Israeli Chief Bank Chief Amir Yaron Speaks at a Press Conference in Jerusalem on January 7, 2019. REUTERS / Steven Scheer / File Photo
Bank of Israel Governor Amir Yaron has given Mastercard permission to hold 10 percent of Israel's SHVA banking service, a central bank said on Tuesday to strengthen its banking sector's competition.
The Mastercard got the green light after the company signed a share purchase agreement with Israeli bank Hapoalim, the Bank of Israel said.
SHVA, the Hebrew abbreviation for Automated Banking Services Ltd, provides a large part of the services in the payment card transaction chain in Israel.
New legislation to increase competition in this sector is forcing Israeli largest banks to reduce their SHVA shares to less than 10 percent.
Hapoalim rival Bank Leumi last year obtained permission to sell 10% Visa.
Israeli Israeli bank said that Hapoalim, Leumi, and the Israeli discount bank are preparing a public offer to sell more of their SHVA shares to the public to cut their shares below 10%.
Bank Director Hedva Ber said the payment sector should undergo changes in the coming years and that the addition of international players specializing in payments will boost innovation and knowledge.
Reporting by Ari Rabinovitch; Editor Tova Cohen / Steven Scheer / Jane Merriman