On March 4, 2025, the Bank of Israel published their findings about a digital shekel design draft that includes essential features for offline payments and multi-network transactions. The bank’s decision to launch a central bank digital currency needs further partnership between officials and business partners before making a final choice.
The bank report says everyone, from children to foreign visitors and businesses should use the new digital shekel form of payment alongside other institutions including financial entities. Our aim is to make digital payment available everywhere with reduced fee costs for businesses. The central bank did not reveal exact fee details but explained that digital shekel payments process faster and better than existing methods.
“Similar to cash, it will be a universal means of payment – anyone will be able to pay anyone, and anyone will be able to receive payment from anyone, but with the convenience and advancement of a digital means of payment.” The Bank of Israel
Bank of Israel Focuses on Payment Privacy
The suggested CBDC works offline by allowing payments when the internet is not accessible. The new system would let users conduct payments in more diverse situations and under various digital network conditions.
The Bank of Israel explained that the digital shekel system will give users more privacy than other digital payment platforms. The government needs to define how it will maintain consumer privacy while enforcing anti-money laundering (AML) and counter-terrorism financing (CTF) standards.
“The level of privacy in the digital shekel will be higher compared to existing digital payments, and similar to cash, it will also offer the possibility of anonymous payments in limited amounts.” The Bank of Israel
The digital shekel system works with multiple financial networks. Under this platform, users will be able to move money with another digital Shekel user or with someone using different payment methods. This cross-network platform addition increases the digital shekel’s value in all market environments.
The Bank of Israel still has not made a decision about issuing a digital shekel version. The report explains implementation will depend on whether the system holds more benefits than expenses and potential threats. Under certain factors the central bank will start implementing their strategy.
The Bank of Israel started analyzing CBDC benefits and risks in 2017 for its digital shekel project. Research activity has grown stronger mainly because global digital currency trends now influence monetary policy and maintain financial stability. During 2021 Bank of Israel assembled a dedicated team to perform advanced research regarding digital shekel technology and financial implications.
The Bank of Israel shows steady movement toward starting the digital shekel as its latest study advances potential deployment. Using a CBDC will open up new opportunities to restructure Israel’s financial system by making digital payments faster and safer.
