Arya News - Israeli restrictions and war damage have created a liquidity crisis, crippling Gaza’s banking system and daily commerce.
Gaza City, Gaza Strip – In a clothing shop in Gaza City’s Sheikh Radwan neighbourhood, Firas Zaqloul stands helplessly as he tries to pay for his purchases.
The problem is that he can’t get the seller to accept his money.
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“I suffer every day when I want to buy something,” Zaqloul said. “The seller refuses worn-out banknotes, so I have to … find some way to pay him.”
“I just hope merchants in Gaza will take the money from us,” he added. “In the end, it’s all money.”
Zaqloul’s experience has become increasingly common in Gaza, where an acute shortage of usable cash has become known locally as a “cash famine”.
Since the war began on October 7, 2023, Israel has severely restricted the entry of cash into Gaza, while its military campaign has devastated much of the territory’s banking infrastructure. The result is an economy in which people may technically have money but struggle to access it, or find someone willing to accept the notes in their possession.
According to the Palestine Monetary Authority, which oversees banking, Israeli attacks have destroyed more than 50 bank branches across Gaza, as well as dozens of cash machines. Large quantities of cash were also trapped inside the vaults of damaged or destroyed banks.
Even after the October 2025 ceasefire allowed banks to reopen some branches, services remained limited largely to administrative transactions, without providing badly needed new liquidity. Palestinians in Gaza say they find it difficult to open new accounts for anyone using replacement identification documents issued after 2023, depriving thousands of people unable to access the electronic banking system at a time when digital payments have become increasingly essential.
Firas Zaqloul sits in a clothing store trying to figure out a way to pay for his items because the seller won’t accept his cash [File: Nour Abo Aisha/Al Jazeera] Waiting for a transfer
In the same clothing store, 23-year-old student Israa Najm waits for a notification to appear on the shopkeeper’s phone.
“As you can see, I have been standing here for two hours, waiting for my mother to transfer the money to the shop owner from home,” she said. “He won’t let me leave with the abaya I want to buy unless he sees the confirmation that the transfer has arrived.”
Najm said that the identity document she obtained during the war is not accepted by banks, meaning that she can’t operate her Bank of Palestine account or electronic wallet.
“Every time I want to go to the market, I have to call my mother and ask her to transfer the money,” she said. “Sometimes she doesn’t have internet, so we both struggle just to make the payment. There is a crisis of trust between the seller and the buyer. I want to deal in cash. The last time I received cash was a year ago, but no one wanted to take it from me because the notes were worn out.”
Due to the lack of cash, everyday transactions are now increasingly complicated.
Inside Abu Jabara Food Mall, modern technology stands in the way of 45-year-old Najwa Kahil’s attempts to buy food for a reasonable price. She explained that using electronic payments made it more difficult to haggle with shopkeepers, and struggles with using the payment apps.
“I don’t know how to transfer to the seller,” Kahil said, explaining that her phone was old and can’t run banking apps. “I take my young son with me so he can call one of his brothers to make a transfer to the supermarket owner. Sometimes I feel I’m begging when I go out to buy; I feel like I’m 100 years old, not 45. Everything is suffering, from buying food, cooking over a fire, and filling water. I spend all day just suffering.”
Shops in Gaza display posters explaining how transfers can be made [File: Nour Abo Aisha/Al Jazeera] Complicated purchases
For Mohammed Awida, a 22-year-old nut seller, shopping now requires planning that would have been unimaginable before the war.
“Buying something has become an operation that requires complete preparation,” Awida said.
“If I’m going to buy food for my mother on Friday, I charge my phone the day before,” Awida added. “I also have to make sure I have access to every electronic payment method, because each seller may demand a particular method, and as the buyer you have to accept their terms.”
Internet outages create another complication.
Some merchants prefer transfers made through mobile phone services that generate an SMS confirmation because banking applications require an internet connection that may disappear at any moment.
“Without that message, the seller isn’t convinced that you’ve paid,” Awida said. “They start looking at you as though you’re trying to steal from them. I hope buying things stops requiring all of this complexity. We are tired.”
The collapse of Gaza’s communications infrastructure, combined with the shift towards electronic payments, has even begun to reshape where people conduct business.
Shops and other businesses offering free internet connections have become informal commercial hubs, drawing sellers and customers who need a reliable connection simply to complete a transaction.
At Bahloul Junction in western Gaza City, 14-year-old Abdul Hadi Abu Shaaban, sells bread outside al-Qadi sweets shoppe, where customers can connect to a free Wi-Fi network. He is one of several street vendors who gather there for the same reason.
“I don’t have a mobile phone, but I ask the buyer to transfer to my father’s bank account, and then I ask him to show me the transfer notice,” Abu Shaaban said. “I don’t receive cash, because all of the cash is old and worn out, and even if I had change, I couldn’t give it to the buyer.”
Abdel Hadi Abu Shaaban, centre, uses the internet from a nearby store to receive online bank payments [File: Nour Abo Aisha/Al Jazeera]