CAL and Eldan test car financing without loading risk onto Eldan

The July 7, 2026 report that CAL will offer vehicle-financing solutions to Eldan customers matters less as a marketing headline and more as a continuation of what Eldan already disclosed in its own report: the previous Direct Finance venture, which was supposed to provide loans to vehicle purchasers through a jointly owned company, ended in January 2026 after the regulatory and business conditions did not mature. The new channel therefore does not start from a blank page. It replaces an earlier attempt to build financing capability around the car-sale moment. For Eldan Transport, the economic value appears only if financing helps close transactions, adds ancillary income or improves customer data without turning vehicle purchasers into a material credit balance on Eldan's balance sheet. For CAL, whose controlling shareholder Discount Bank is already required to separate from its holding and whose planned purchasers include Harel Investments and Union, the channel may add a consumer-credit origination point at a time when CAL's growth quality also matters for the transaction's contingent consideration. This still does not prove a change in value or profitability: the report does not disclose pricing terms, loan volume, fee sharing, data rights or who bears credit losses. The current read is a potentially useful distribution test, not proven economic change at CAL or Eldan.

The new channel replaces an old attempt, not just another product

What separates the current report from a routine cooperation headline is the history Eldan itself disclosed. In its 2025 annual report, Eldan described a 2022 agreement with Direct Finance to establish a jointly owned company, 70% held by Eldan and 30% by Direct Finance, that would provide loans to customers buying vehicles from Eldan and from additional agreed parties. The agreement was subject to permits and licenses, including an expanded credit license from the Capital Markets Authority, by the end of 2025.

In January 2026, Eldan said the parties had ended the talks on continuing the cooperation and that the arrangement had ended. In the same disclosure, Eldan wrote that it was considering and examining other structures for loan origination to its customers. That makes CAL less of an incidental service provider and more of a candidate to fill the business role Eldan was already looking for: the ability to offer financing at the vehicle-purchase point without rebuilding a jointly owned licensed lender.

This is also where the story has a clear boundary. If CAL simply places an off-the-shelf product in Eldan branches or on Eldan's website, Eldan's benefit may be limited to customer convenience and referral fees. If CAL receives structured access to customers arriving at a car transaction, it gets an origination channel with clear purchase intent, vehicle data and the ability to price credit around a specific asset. If Eldan subsidizes the rate or shares part of the risk, that becomes a decision that affects vehicle-transaction profitability and Eldan's credit profile.

For Eldan, good financing should protect a leveraged car balance sheet

Eldan is not a consumer-credit company. It is a leveraged vehicle company that earns from leasing, rental and car sales, and its balance sheet is built around a large debt-funded fleet. In the annual report, Eldan says that every year it sells roughly one quarter to one third of its vehicle fleet, and in 2025 about 58% of all vehicles sold were sold through the retail channel. In the leasing and rental segments, 57% of vehicles sold and 64% of vehicle-sale revenue went through retail; in vehicle trading, retail accounted for 82% of quantity and 79% of revenue.

That is a real distribution base: private and business customers arrive to purchase a car, sometimes with a trade-in, and Eldan already markets complementary packages around the transaction. The Eldan Plus offer, for example, includes extended warranty, return or replacement options, future trade-in and a benefit package that also includes financing. Financing is therefore not foreign to Eldan's sales process.

The more important part is credit risk. Eldan writes that retail customers usually pay an advance when signing the sale agreement and the remaining balance before vehicle delivery, and that full payment is a material condition for delivery. In its financial-risk note, Eldan adds that credit exposure to those customers is negligible because proceeds are collected in cash as a condition for delivery. That is the economic starting point: Eldan wants to improve buyer conversion, not replace immediate cash with consumer-credit exposure on its own balance sheet.

This makes risk allocation the most important undisclosed term. A model in which CAL underwrites, prices and holds the credit while Eldan receives a customer who can complete the purchase can preserve the commercial advantage without changing Eldan's risk structure. A model in which Eldan subsidizes the loan, commits to volumes, shares losses or holds part of the credit would require a different reading of vehicle-sale margin, capital consumption and liquidity.

For CAL, a vehicle channel is valuable only if it produces quality credit

CAL is already inside a sale process that matters more than the current headline. In Discount's reports it has been classified as a discontinued operation since the second quarter of 2025, and the agreement to transfer Discount's CAL stake includes immediate consideration and contingent consideration linked to CAL's business performance in 2027 and 2028. The First International Bank, through FIBI Bank and FIBI Holdings, said it intends to exercise its tag-along right on the agreed terms. Completion of the transaction still depends on regulatory approvals and third-party approvals.

In that context, cooperation with Eldan does not change the CAL transaction by itself. It does add a relevant business question for buyers and selling shareholders: can CAL expand consumer credit through partners that meet the customer at a decision point, rather than only through cards or loyalty clubs. Eldan's customer is just before the purchase of a relatively expensive asset, and information around the vehicle, transaction price, advance payment and trade-in may improve underwriting if CAL can access and use it.

The comparison with CAL's older distribution agreements matters. Discount's reports include agreements with banks and customer clubs, with revenue-sharing, compensation and fee mechanisms. The Eldan channel can look similar only if it proves to include customer-access rights, activity volumes, compensation structure and measurable credit risk. Without those, it remains additional shelf space: another place to offer credit, not necessarily a meaningful profit source.

What must show up in reports before the channel becomes numbers

The first signal is quantitative: loans originated to Eldan customers, penetration rate within vehicle transactions, average loan size and whether the loans finance new cars, zero-kilometer vehicles or used vehicles coming out of leasing and rental fleets. Without that base, it is impossible to know whether the channel changes CAL's growth pace or only provides an ancillary product to a small share of buyers.

The second signal is profitability: whether Eldan receives a referral fee, whether it subsidizes part of the interest rate to promote sales, whether CAL pays for customer access, and whether revenue appears as a fee, a lower vehicle-sale margin or financing income at CAL. In Eldan's report, retail car sales are based on payment before delivery. Any change that replaces immediate cash with a financing mechanism has to show why it improves the total margin, not just moves money between line items.

The third signal is credit quality. A car channel can grow consumer credit quickly, but it is also exposed to used-car prices, household repayment capacity and demand cycles. If CAL holds the loans, investors will need to see whether delinquency and provision metrics remain stable. If Eldan carries part of the exposure, it should be visible through guarantees, commitments, subsidies or changes in receivables and customer-credit policy.

The fourth signal is regulatory and commercial: data-use rights, follow-on marketing ability, competition limits and privacy constraints. In the CAL sale, regulatory approvals are already a condition for completion. A new channel with a vehicle company does not replace those approvals, but it can affect CAL's growth story if it proves to be a customer source that is not dependent only on existing banks.

Conclusion

The CAL and Eldan report is worth tracking because it sits exactly where the two companies need different evidence. Eldan needs to turn customer traffic in vehicle purchases into additional income or better closing rates without adding material consumer-credit risk to its balance sheet. CAL needs to show that it can generate quality credit through distribution partners while its shareholders advance a sale that includes a contingent consideration component tied to future performance.

The current conclusion is narrow: this is an interesting distribution channel, and it is smarter than a routine cooperation headline because it comes after Eldan's Direct Finance attempt ended and because Eldan has a retail base that creates a real contact point with vehicle buyers. It is still not enough to change the financial read on Eldan, Discount, FIBI or Harel. For that, the next disclosures need to show who holds the risk, the penetration rate, the fee or subsidy, and whether CAL's credit quality remains sound once the channel starts producing loans.