Gaza faces 'cash famine' as war disrupts payments and banking

In Gaza City, the simple act of buying clothes has become a daily struggle for residents like Firas Zaqloul. His home was destroyed in the recent war, burying his Palestinian identity card. Without it, he cannot open a bank account or electronic wallet, leaving him reliant on increasingly scarce and worn-out banknotes that many sellers refuse to accept. "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."

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I suffer every day when I want to buy something. The seller refuses worn-out banknotes, so I have to … find some way to pay him.

Zaqloul's experience highlights a growing crisis in Gaza known locally as a "cash famine." Since the war began on October 7, 2023, Israel has severely restricted the entry of cash into the territory. Simultaneously, the ongoing military campaign has devastated much of Gaza's banking infrastructure. This has resulted in an economy where people may possess funds but struggle to access them or find willing recipients for the cash they hold.

The Palestine Monetary Authority reports that Israeli attacks have destroyed more than 50 bank branches and dozens of cash machines across Gaza. Significant amounts of cash were also trapped within damaged or destroyed bank vaults. Even after a ceasefire in October 2025 allowed some banks to reopen, services remained largely administrative, failing to inject much-needed liquidity into the economy.

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I just hope merchants in Gaza will take the money from us. In the end, it’s all money.

Adding to the difficulty, Palestinians in Gaza report that banks are reluctant to open new accounts for individuals using replacement identification documents issued after 2023. This exclusion affects thousands who cannot access the electronic banking system at a time when digital payments are becoming increasingly vital. Student Israa Najm described waiting two hours in a clothing store for her mother to transfer money from home, as the shopkeeper would not accept her cash or her war-issued ID for a transaction.

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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. He won’t let me leave with the abaya I want to buy unless he sees the confirmation that the transfer has arrived.