Amid the widespread hunger crisis in Gaza, many Palestinians in the enclave have chosen to avoid aid sites and trucks carrying food, fearing they could be trampled or killed by gunfire. Instead, they have prioritized buying what food they can from the small number of markets and shops that still operate in the territory.
But finding enough money to buy food in Gaza is difficult because of an extreme shortage of hard cash itself. Banks and A.T.M.s have been destroyed and shut down, and since the Hamas-led attacks on Oct. 7, 2023, Israel has not allowed any large injections of physical cash by the banking sector into the enclave. That has opened up a black market for obtaining Israeli shekels, the predominant currency, with Palestinians forced to pay exorbitant rates to gain access to their money to feed themselves and their families.
At the same time, there has been a huge surge in the price of basic goods since the start of the war, especially in the face of Israeli restrictions on the entry of food into the territory. A 55-pound sack of flour is around $180, two pounds of sugar is about $10, and a similar amount of tomatoes about $20, according to surveys carried out this week by the Gaza Governorate Chamber of Commerce in three cities. Prices have come down since more goods have entered in recent days, but they are still far higher than before the war.
Some Palestinians have taken to selling their belongings. Some urge friends and family overseas to send funds. But even Palestinians with money in their bank accounts, including those receiving regular salaries from international organizations, are paying commissions of roughly 50 percent to people who have stockpiles of Israeli shekel notes for access to their own cash.
Those people — who are essentially using the cash they previously accumulated to make more money — have typically set up shop at internet cafes or on street corners in Gaza City, Deir al Balah and Khan Younis. They, or their representatives, offer bank notes to customers who then transfer funds online in exchange, according to residents of Gaza who use the system.
Shahad Ali, 22, writes for international publications about what it is like to live in Gaza, and she receives wire transfers for her dispatches. Ms. Ali, whose mother was killed in the war and whose family home was destroyed, said that to get $300, she was forced to pay a commission of $144.
“It’s so frustrating to receive only a part of what you work so hard for,” Ms. Ali said.
The struggle for hard cash
Gaza has long suffered from a shortage of hard cash but the war has made it much worse, said Bashar Yasin, general manager of the Association of Banks in Palestine, an organization that represents the banking sector.
“We’re talking about an old problem that has turned into an absolute disaster,” Mr. Yasin said.
Since Hamas took control of the territory in 2007, Israel has rarely permitted Palestinian banks to transfer shekel notes into the territory.
“It’s completely unjust,” said Nidal Kuhail, 31, a resident of Gaza City who helps support his parents and five sisters. He worked at a Thai restaurant before the war but says that he now has nothing left in his account and that he spends most of his days trying to find money, including contacting anyone abroad who may be able to send funds to support him and his family.
“We need every shekel we can get,” Mr. Kuhail said.
Where did the money go?
It is not clear how much money is actually in circulation in Gaza.
In the first seven months of the war, many wealthy Palestinians who fled Gaza took their shekels with them, Mr. Yasin said.
Money in bank vaults was also looted. About $180 million of the $290 million that was stored in banks before the Oct. 7 attack has been taken, Yahya Shunnar, governor of the Palestine Monetary Authority, the Palestinian bank regulator, said. It is unclear who was responsible, Mr. Shunnar said, noting that both Hamas and Israel had the resources to blow vaults open and take money.
The Israeli military said that it had seized “large amounts of cash belonging to Hamas and used to fund its military operations.” It did not directly respond to questions about whether it had taken money from bank vaults.
Izzat al-Rishq, the Qatar-based director of Hamas’s media office, did not respond to a request for comment.
Mr. Shunnar said that no fresh cash was injected into the system partly because the Palestine Monetary Authority feared that it could be stolen again. Still, the regulator sent a letter to the Israeli authorities this year requesting that they examine the possibility of sending money into the territory, Mr. Shunnar said, but did not receive a reply.
COGAT, the Israeli military agency that regulates affairs in Gaza, said that Israel would not permit the transfer of shekel notes into Gaza, citing what it described as “Hamas’s reliance on cash to sustain its military operations.”
As old bank bills have disintegrated, a repair service has sprung up to fix them, with tape, glue and craft knives used to piece them together.
Palestinian financial and economic experts have argued that the best solution would be for people in Gaza to use digital payments. During the cease-fire from January to March this year, digital payments were more widely accepted. But those services were disrupted after Israel restarted the war and sent a sternly worded letter to the biggest Palestinian bank.
In that letter, dated April 24, a senior official in the Israeli Finance Ministry, Yoray Matzlawi, wrote to the chief executive of the Bank of Palestine, Mahmoud Shawa, saying that information from the Israeli authorities had indicated that e-wallets were being exploited by militants in Gaza. Mr. Matzlawi asked the Bank of Palestine to take “immediate action.”
PalPay, a digital payments company in which the Bank of Palestine has a majority stake, responded by reducing the limit for daily e-wallet transactions to 500 shekels, about $145, from 3,000 shekels, and freezing the opening of new e-wallets, according to an official at the Bank of Palestine, who spoke on the condition of anonymity to discuss sensitive topics. The official said that the bank took the action to ensure it was maintaining international standards related to tackling money laundering and terrorism financing and to comply with guidance from the Palestine Monetary Authority.
Yet even for those who still have some access to e-wallets, they are difficult to use after two years of a devastating war.
Patchy internet access and recurring cellular network and power outages make connectivity inconsistent.
The number of vendors accepting digital currency has decreased as they have come under pressure to hold on to cash, according to a UNICEF report from June 2025. Those who still do charge a premium: Goods that had been selling at about 90 shekels, or $26, would instead cost around 120 shekels, Ms. Ali said.
Ultimately, Palestinians say, the only way for life to improve in Gaza is for a new cease-fire between Israel and Hamas to be agreed on, echoing calls from aid agencies and foreign governments.
“Stopping the war is essential,” said Faisal al-Shawa, deputy chairman of the board of PalTrade, a Palestinian business advocacy organization.
Saed Abu Aita, 44, was wounded at the beginning of the war and has a piece of shrapnel stuck in his chest. He was displaced from his home in Jabaliya and now lives in a tent with his family in central Gaza. He has started selling his clothes to get money to buy flour.
“Nothing is easy for us,” he said. “We’re put through unending torment to get the simplest of things. When will our misery end?”
Adam Rasgon is a reporter for The Times in Jerusalem, covering Israeli and Palestinian affairs.
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