Israelis spent a record amount on credit cards in June

Israelis spent a record NIS 1.158 billion ($350 million) a day in credit-card transactions in June, according to the company that handles all credit payments in Israel.

Total transactions for the month reached NIS 34.7b. (just over $1b.), an increase of 18.3%, compared with a year earlier, Shva reported Monday. Online transactions rose 25% over the past year, largely due to changes in consumer habits caused by the coronavirus pandemic.

Since the outbreak of the pandemic, credit cards have become the most common payment mechanism in Israel, and cash usage declined.

The previous record for credit-card sales volume was in March, when Israel began coming out of lockdown and people were preparing for Passover. However, daily spending was 1.6% higher in June.

Much of the increase was attributable to the entry of Apple Pay into Israel on May 5. Apple’s digital-wallet solution has quickly gained widespread market acceptance due to its ease of use; digital-wallet usage in Israel jumped 720% in May. June was the first full month where the service was available in Israel.

The Bank of Israel has prepared the economy for more advanced payment technology. Last November, Israeli credit-card processors upgraded to the EMV standard, which enables contactless transactions, including by cellphones and smartwatches. Most transactions made in Israel are now contactless.

Israeli law limits the size of transactions that can be done in cash to NIS 6,000 for businesses and NIS 15,000 for private individuals.

In addition, the challenges of international travel during the pandemic led many to vacation locally instead of traveling abroad.

There were some 500,000 more people in Israel in June, compared with June 2019, Shva reported, citing statistics from the Population and Immigration Authority.