In Gaza, when money is scarce, every choice counts: Bank, cash, or credit?

In February 2026, Palestinians in the Gaza Strip continue to struggle with severe cash shortages and financial management challenges as they navigate daily life amid the ongoing Israel-Palestine conflict that began in October 2023. The devastated enclave faces a liquidity crisis imposed by Israel, forcing residents to make difficult choices between traditional banking, scarce cash, or electronic payment systems that are often unreliable due to limited infrastructure. With approximately 90% of bank branches and cash machines destroyed during the war, Palestinians who once used Israeli shekels for daily transactions now find themselves dependent on worn-out currency from before the conflict or new digital payment platforms that struggle with connectivity issues. The cash shortage has fundamentally altered daily life for Gazans, with many resorting to credit purchases and barter systems to meet basic needs. Samar Abu Harbied, a 45-year-old Gaza City resident, explained how she now purchases groceries on credit until her family can transfer money electronically, while Najlaa Sukkar described being turned away from medical care due to insufficient funds and worn-out banknotes. As the Muslim holy month of Ramadan began, these financial constraints became even more pronounced, with families struggling to afford even basic Iftar meals. The Palestinian Monetary Authority has introduced mobile payment systems like PalPay and Jawwal Pay to address the liquidity crisis, but these solutions have created new challenges for a population lacking consistent electricity, internet access, and smartphone ownership. Economic analysts warn that Gaza's financial crisis has evolved from a simple liquidity problem to a structural breakdown of the formal monetary system. Ahmed Abu Qamar of the Palestinian Economists Association notes that the black market now dominates cash circulation, with a small group of traders effectively controlling liquidity through high-commission operations. When cash itself becomes a traded commodity, its value increases beyond its nominal worth, signaling severe distortion in the monetary system. This transition to a fragmented survival economy has been exacerbated by widespread selling on credit, which indicates declining incomes and weakened purchasing power rather than market stability. With approximately 95% of Gaza households now dependent on aid, the economic crisis has created fertile ground for middlemen who charge exorbitant fees—sometimes up to 50%—for cash exchange services, further impoverishing an already devastated population.