Digital Bank One Zero

Digital Bank One Zero is an Israeli digital-only commercial bank operated by One Zero Digital Bank Ltd. It was the first new bank licensed in Israel after more than four decades, and it operates under the supervision of the Bank of Israel as a retail-focused institution offering app-based banking, deposits, credit, payments and investment-related services.^[1][2]

Overview

One Zero was formed in 2019 and is controlled by Prof. Amnon Shashua through Fin-Digit Ltd., according to the bank’s 2024 yearly financial report.^[1] The bank’s name is commonly styled as ONE ZERO. It is part of Israel’s supervised banking system and appears in the Bank of Israel’s list of supervised banking corporations with reporting symbol 18001.^[2] In the Israeli banking market, where the largest incumbent banking groups include Bank Hapoalim, Bank Leumi, Israel Discount Bank, Mizrahi-Tefahot Bank and First International Bank of Israel, One Zero is notable for being a branchless, digital-first entrant rather than an incumbent-bank digital brand.

The bank describes its model as digital banking with an emphasis on technology and artificial-intelligence-based tools.^[1] Its own public materials state that it offers banking through a comprehensive digital platform covering accounts, debit cards, investments and pension-related services, and that it operates under Bank of Israel supervision.^[4] As an encyclopedia matter, those statements are best understood as the bank’s own description of its commercial model; the regulatory fact is separately confirmed by the Bank of Israel’s supervised-entity list.^[2]

One Zero’s significance lies less in its absolute scale and more in its role in Israeli banking policy. The Bank of Israel and the Ministry of Finance promoted new-bank licensing, payment infrastructure access, credit-data reforms and bank-switching projects as tools intended to increase competition in a concentrated banking market.^[5] One Zero became the first practical case of that licensing policy in the modern Israeli market.

Licensing and regulatory status

The Bank of Israel announced in September 2019 that it had approved the establishment of a new bank. In that announcement, the central bank linked the licensing step to broader competition measures, including reforms in credit cards, credit data, banking efficiency and easier switching between banks.^[5] The central bank subsequently allocated bank identification code 18 to the new digital bank.^[6]

One Zero received a restricted bank license on December 30, 2019. The restrictions were connected to the bank’s need to complete operational, managerial, technological and regulatory preparations before full commercial activity.^[3] According to the Bank of Israel, the license depended on milestones including the establishment of information systems and infrastructure, connection to payment and settlement systems and monetary tools, completion of a pilot process and raising the required capital.^[3]

The Bank of Israel announced on January 10, 2022 that the Governor and the Supervisor of Banks had notified One Zero of approval to remove the restrictions from the bank’s license after the bank completed the required establishment milestones.^[3] The central bank stated that after the removal of the restrictions, One Zero’s status was the same as that of other banks in Israel: it was supervised by the Bank of Israel’s Banking Supervision Department for stability and depositor protection.^[3]

In One Zero’s own 2024 report, the bank states that it began operating under the restricted license in March 2021 as a “banking corporation in formation,” within a pilot with a limited number of customers.^[1] The report also states that, from January 2022, the bank was considered a “new banking corporation” under Proper Conduct of Banking Business Directive 480, which sets adjustments for new banking corporations.^[1]

Ownership and governance

One Zero’s controlling shareholder is Prof. Amnon Shashua, through Fin-Digit Ltd.^[1] The Bank of Israel’s 2022 announcement also identified One Zero as controlled by Shashua and named Shuki Oren as chairman of the board and Gal Bar Deah as chief executive at that time.^[3] The bank’s current public “about” page lists Amnon Shashua as founder and majority shareholder, Eyal Gafni as CEO and Shouky Oren as chairman.^[4]

The bank’s board and shareholder page states that in December 2021 One Zero completed a $120 million international funding round led by Julius Baer, Tencent and SBI, with Prof. Shashua remaining the controlling shareholder and participating in the funding round.^[7] The 2024 annual report states that the bank had raised about $356 million since establishment and expected to raise additional capital in order to expand into new activities and areas.^[1]

Because One Zero is a regulated bank, ownership is not only a corporate governance matter but also a supervisory issue. Israeli banking law and Bank of Israel practice require approval for control of a bank, and the 2019 licensing process included the Governor’s readiness to grant a control permit to the founders of the new bank.^[6]

Business model and services

One Zero operates as a digital-only bank without relying on a traditional branch network. Its core market, according to the 2024 financial statements, is a single operating segment: the Israeli retail segment.^[1] The bank’s public materials emphasize mobile banking, transparent pricing and a platform intended to consolidate financial activity across bank accounts, cards, investments and pensions.^[4]

The bank’s activity includes deposits from the public, credit to the public, card-related services and securities activity. The 2024 report states that One Zero signed an agreement with Isracard in May 2020 to issue and operate credit cards for bank customers.^[1] It also reports that the board of the Tel Aviv Stock Exchange approved the bank’s stock-exchange membership in December 2020, that the TASE clearinghouse approved its clearinghouse membership in November 2021, and that both memberships came into effect in May 2022.^[1] The same report states that, as of the report date, One Zero allowed customers to trade certain securities on the Tel Aviv Stock Exchange.^[1]

The bank also connected to core financial-market infrastructure. In March 2020 it entered into an agreement with SWIFT to become a user of the global financial messaging network, enabling money transfers in Israel and abroad and participation in the Bank of Israel’s RTGS system.^[1] It is also part of MASAV-related arrangements, reflecting its integration into Israel’s payment and clearing infrastructure.^[1]

Launch and customer growth

After operating a limited pilot under its restricted license, One Zero began a soft launch in March 2022 with the gradual addition of customers.^[1] In August 2022, the bank began limited activity by gradually adding customers from a waiting list, and from November 2022 it allowed accounts to be opened independently.^[1]

The bank reported that 2024 was its second full year of operation in the retail market and that more than 120,000 customers were using its services.^[1] That customer figure should be read in the context of the bank’s early-stage status. One Zero is a relatively small institution in balance-sheet terms compared with Israel’s largest banking groups, but its development is closely watched because it tests whether a newly licensed, technology-oriented bank can grow in a market long dominated by incumbents.

Financial profile

One Zero’s 2024 financial statements show a bank still in a growth and loss-making phase. The bank reported interest income of NIS 103.7 million for 2024, interest expenses of NIS 64.1 million and net interest income of NIS 39.7 million.^[1] It also reported fees of NIS 34.2 million, total non-interest income of NIS 34.1 million, operating and other expenses of NIS 322.8 million, and a net loss of NIS 267.9 million for 2024.^[1]

The annual report explains that One Zero had accumulated losses from the start of activity and that management expected additional losses in the near term while the bank remained a new bank undergoing accelerated growth.^[1] It also states that continued growth and technological development required increases in equity in accordance with the bank’s business plan and regulatory requirements, and that the bank would need additional capital until reaching a level of profitability sufficient for its capital needs.^[1]

At December 31, 2024, One Zero reported total assets of NIS 2.923 billion, compared with NIS 2.174 billion at the end of 2023.^[1] Its cash and bank deposits were NIS 2.241 billion, and net credit to the public was NIS 352.0 million at the end of 2024.^[1] Deposits from the public were NIS 2.578 billion at year-end 2024, compared with NIS 1.835 billion at year-end 2023.^[1] Of the 2024 public-deposit total, NIS 2.127 billion was deposits by individuals and NIS 451.0 million was deposits of others, described as dealers in the report.^[1]

The balance-sheet structure reflects the economics of an early-stage bank that has gathered deposits faster than it has built a large credit portfolio. In 2024, most interest income came from deposits with banks, mainly deposits at the Bank of Israel, rather than from credit to the public.^[1] Credit risk remained a smaller balance-sheet category than cash and bank deposits, with gross total credit to the public reported at NIS 366.6 million and net credit to the public at NIS 352.0 million at the end of 2024.^[1][1]

Role in Israeli banking competition

One Zero is part of a wider policy effort to reduce barriers to entry in Israeli banking. The Bank of Israel described the licensing of a new bank as one step among measures taken with the Ministry of Finance to increase competition, including the separation of two credit-card companies from banks, the creation of a credit-data system, banking efficiency measures and easier bank switching.^[5]

The bank’s establishment also served as a precedent for later licensing processes. The Bank of Israel’s material on graduated banking licenses has cited One Zero as an example of a bank that began providing services to the public after completing the stages of establishment and licensing.^[8] Israel’s later licensing and access processes for additional entrants, including Bank Esh Israel and payment-related entities, followed in an environment shaped partly by the One Zero experience.^[8]

Technology, infrastructure and risk considerations

One Zero’s business model depends heavily on technology, information security and outsourced or cloud infrastructure. The Bank of Israel said that during the establishment process the bank’s readiness was examined in areas including information security, cyber protection, technological risk management, risk-management quality and supervisory and control tools.^[3] In its 2024 report, One Zero disclosed that it had an agreement with Amazon Web Services for cloud computing services, including support and availability services compatible with the bank’s standards.^[1]

The same technology-focused model creates operational and regulatory dependencies. A digital bank must maintain resilience in account access, payments, fraud prevention, identity verification, cybersecurity and customer support. These risks are not unique to One Zero, but they are central for any bank that lacks a physical branch network and depends on a digital service channel.

Market position and limitations

One Zero’s public profile is high relative to its balance sheet because it is associated with new-bank licensing and digital transformation in Israel. Nevertheless, by reported assets and deposits, it remains much smaller than the long-established Israeli banking groups. Its 2024 report also indicates that it is not yet profitable and that its growth plan depends on continued capital support.^[1]

The bank’s operating segment is Israeli retail banking, and its own report noted that international expansion plans and structural changes were frozen or delayed while the bank focused on activity in Israel.^[1] Its development therefore depends on its ability to acquire and retain customers, expand fee and interest revenue, manage credit risk, contain technology and operating costs, and satisfy regulatory capital and liquidity requirements.

See also

Relevant Israeli finance entries include Bank of Israel, Ministry of Finance (Israel), Bank Hapoalim, Bank Leumi, Israel Discount Bank, Mizrahi-Tefahot Bank, First International Bank of Israel and Tel Aviv Stock Exchange.