Gazans count cost of securing banknotes as traders demand high commissions

The National

2 days ago

In the shadow of war, economic collapse and severe shortages of food and other essentials, civilians in Gaza face an additional challenge in the struggle to survive: the rocketing cost of accessing their own money.
With banks closed because of the conflict and digital payments widely rejected in local markets, Palestinians are forced to rely on an informal and increasingly predatory trade in physical currency, with commission rates as high as 55 per cent.
'I get paid 2,800 shekels [$817] a month from the Palestinian Authority,' said Kamel Abu Hazaa, 42, who was displaced from Jabalia and now lives in Al Nasr area of Gaza city. 'But after cashing it out, I receive only about 1,350 shekels. The rest? Gone, to liquidity traders and middlemen.
"Even if I had the full amount, it wouldn't be enough. Flour costs 30 shekels a kilo, sugar is 200. The prices are insane."
Businessmen, flush with cash earned before the war began in October 2023, now control the flow of physical currency. Given the risk of storing large amounts of money while banks are closed, they offload portions of it through a chain of intermediaries, who in turn sell it at a high mark-up to desperate civilians.
Buyers receive cash after transferring funds to the traders electronically. But those who profit from the system do not consider themselves to be the villains. A small-scale cash trader operating in Gaza city said the system was deeply flawed, but insisted the responsibility lay with "big traders" who control the supply and set the rates.
"We add maybe six to 10 per cent just to survive. But the ones above us? They want 45 per cent, sometimes more," he told The National. 'Today, I bought cash at a 43 per cent commission and had to sell it at 52 per cent just to make a living. We small traders don't even know who the big players are – the cash reaches us through intermediaries.'
Moamen Al Gharbawi, 35, said his brothers living abroad send the family $700 a month. But he has been unable to convert that into cash because of the prices charged by currency traders.
'Last month, the commission was 38 per cent. This week, it's gone up to 55 per cent,' said Mr Al Gharbawi, who lives in the Sheikh Radwan area of Gaza city, after being displaced from Jabalia Camp. "More than half of what they send is lost and we're a family of eight. We don't have food. My elderly parents need special, healthy food that I can't afford
"Liquidity traders are bleeding us dry. There's no one watching them, no one stopping them."
Abdullah Sharshara, a legal researcher and civil society activist in Gaza, said the practice was unethical and illegal. 'Some say there's no legal basis to stop it,' he told The National. 'That's nonsense. The most basic legal foundation is that those trading liquidity are clearly violating the terms of the bank account agreement. It's a breach of Palestinian law and a flagrant exploitation of a broken system.'
Mr Sharshara called for the Palestinian Monetary Authority to take immediate action, including freezing the accounts of those involved in the trade and reopening the banking system, ensuring it is organised and secure.
"Major traders must be forced to inject liquidity back into the market through legitimate channels," he added. "Without oversight, the black market cash trade will only deepen people's suffering."
While the trade in currency arose from the breakdown of formal banking, Gazans and experts agree that it has become a tool of exploitation in the hands of opportunists. 'People are desperate,' Mr Abu Hazaa said. 'They'll accept any rate just to put food on the table. But every day traders raise the percentage, and no one holds them accountable.'