In a noisy market in Gaza City, a money repairman carefully inspects a worn, yellowing 100 shekel ($30.50) bill, Israel’s official currency.
He spreads the bills that he smoothes with his hands and, with careful pencil strokes, highlights the faded color.
Baraa Abu al-Aoun should be studying at university, but he makes a living behind a table he has set up on the side of the road, charging a small sum to help keep money in circulation.
Fixing banknotes is a booming new business in Gaza.
Since Hamas’ deadly attack on Israel in 2023 and Israel’s devastating offensive that followed, Tel Aviv has suspended sending banknotes to Gaza along with other supplies.
Due to the Israeli attacks, most of the banks were destroyed and many ended up being looted. Although some branches have reopened, since the ceasefire came into effect seven weeks ago, there are still no ATMs in operation.
But people need cash to buy food and essential items. This has forced them to turn to informal money changers, who charge high commissions, to convert digital transfers into cash.
It has also led to a huge increase in the use of e-wallets and money transfer apps.
That means that each banknote in circulation becomes more relevant than ever, no matter how worn it is, and that’s where Baraa comes in.
“My tools are simple: a ruler, colored pencils and glue. The ceasefire has not changed the financial situation. What I do now is assist people and help them,” says the student.
The shortage of banknotes
After two years of intense war, Gaza’s economic collapse has been so devastating that, according to a new UN report, the entire population of more than 2 million people has been pushed into poverty.
Four in five people are now unemployed, according to the United Nations Conference on Trade and Development, and even those who still have income or savings struggle to access cash.
“It’s pure suffering and nothing more,” says Numan Rayhan, who is displaced in Gaza City from Jabalia in northern Gaza with few belongings. “Shortage of income, shortage of money, lack of cash flow from the banks.”
Early in the war, Israeli strikes targeted banks that Israeli officials said were linked to Hamas. Its vaults were looted by armed Palestinian gangs, some presumably linked to Hamas.
The Palestinian Monetary Authority said cash worth about $180 million was stolen.
Cogat, the Israeli defense body that controls Gaza border crossings, confirmed that, in line with a political order “and due to Hamas’ dependence on cash to maintain its military activity,” Israel has not allowed banknotes to enter Gaza.
The lack of banknotes in circulation “has caused problems for both sellers and buyers,” says Zakaria Ajour, a trader at another market in Gaza City.
People no longer want to accept worn, delicate bills at face value, “even if they have small scratches or pieces of tape.”
“Some clients come only because they want change for transportation, but I don’t have change,” he adds.
“10 shekel coins are hardly found. Even when they are found, they are practically worthless due to the inflation that has triggered the cash shortage crisis,” he says.
At the doors of the Bank of Palestine, in Gaza City, in one of the nine branches of the five that have reopened, long lines of people are seen. Although customers can only reactivate frozen accounts, open new ones or log into banking apps.
Asmaa al-Ladaa wants to open an account so she can receive money directly from her relatives who live outside Gaza.
“The whole process is chaos and crowding. We wake up at 6 in the morning and leave our children in a tent. We leave everything just to come to the bank,” he adds.
The business of money
In the southern city of Khan Younis, where banks are too vandalized to reopen, Abu Khalil has just returned from a tour of central Gaza.
After spending much of the day waiting in line, he has not managed to get into the bank. The mere idea of returning the next day makes him desperate.
This elderly person receives a monthly salary of about 2,000 shekels (US$612) from the Palestinian Authority, but says that almost half of his income goes to expenses involving money sellers or traders.
“You have to pay commissions. There is no alternative,” he complains.
During the war, many small merchants who previously offered money transfer and exchange services had to adapt to the urgent demand for cash. Thus, to convert electronic transfers into cash, they began to charge customers a high commission.
Sometimes reaching 50%, although in recent times they have fallen.
An informal money changer, who prefers not to give his name, says it is market rules that determine commission rates.
“Our work is directly linked to market activity and the influx of goods and aid,” he says.
“When there is an influx of goods and active purchases and sales, the commission drops significantly, sometimes up to 20%. But when the crossings are closed, the rate increases,” he adds.
Electronic transfers through banking apps, for which shop and stall owners charge lower fees, have become a widespread solution for Gazans.
Virtual wallets
The Palestinian Monetary Authority, which functions as a financial regulator, has launched a payment system that allows instant transactions between local bank accounts.
For those without accounts, the Bank of Palestine offers e-wallets. According to this institution, there are more than 500,000 users in Gaza. These transactions can be carried out without an Internet connection or applications, just a text message from any mobile phone.
Even e-wallets are being used to send financial aid directly to families in need, by humanitarian organizations such as the United Nations Children’s Fund (UNICEF) and the World Food Programme.
Unicef says that since the beginning of last year it has made cash transfers to around 1 million people, half of them children. The organization prioritizes vulnerable children, including amputees and orphans, as well as pregnant or nursing mothers.
“You can go to the food store and buy with your phone, which is used as a means of payment,” explains Jonathan Crickx of Unicef.
“This allows for very high traceability of how the money is spent. We verified that 99% of all beneficiaries are spending the money, first, on food and water. Then, on hygiene items. Finally, on electricity through generators,” he adds.
Crickx says he has seen families buy 2 kilos of tomatoes for US$80 or 5 kilos of onions for US$70.
Hanan Abu Jahel, who lives with her family in a camp in al-Zawaideh in central Gaza after being displaced, recently received 1,200 shekels ($367) from Unicef. That money is used to buy basic products such as rice, lentils and pasta.
“My children need vegetables, fruits, meat and eggs. My youngest son especially misses eggs, but I can’t get them. The prices are still too high and I have to cover the needs of 12 people,” she explains.
The future of Gaza
US President Donald Trump’s 20-point peace plan promises an “economic development plan to rebuild and energize Gaza.”
To that end, he has convened “a panel of experts who have contributed to the creation of some of the prosperous modern cities of the Middle East,” which foresees new investments and “interesting development proposals” that can “create jobs, opportunities and hope for the future of Gaza.”
However, there are still no details on how they will begin to boost growth and promote stability, just as the UN trade agency warns that the Strip is experiencing the most serious economic crisis ever recorded.
Back in Gaza City, Baraa Abu al-Aoun holds up to the light the banknote he has been expertly working on. He has a group of customers waiting, attracted by his sign that promises repairs “with high professionalism and without adhesive tape.”
While Baraa works, he longs to return to a normal life, with the prospect of more profitable employment.
“I just want this war to end completely. My hope is to finally feel relief, so I can study and work with my degree. In Gaza we are barely surviving. We are no longer human beings,” he says.
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