Severe Cash Shortages in Gaza Intensify the Food Crisis

Amid the escalating hunger crisis in Gaza, many residents are avoiding aid distribution points and food delivery trucks due to fears of being injured or trampled. Instead, they focus on purchasing whatever food they can from the limited number of markets and shops that remain open.

Securing enough cash to buy food is a significant challenge because of a severe shortage of physical currency. Banks and ATMs have been destroyed or closed, and since the Hamas-led attacks on October 7, 2023, Israeli authorities have prohibited large infusions of cash into Gaza’s banking system. This situation has fueled a black market for Israeli shekels, the dominant currency, forcing Palestinians to pay steep premiums to access their funds.

The prices of essential goods have surged dramatically since the conflict began, exacerbated by Israeli restrictions on food imports. For example, a 55-pound sack of flour now costs approximately $180, two pounds of sugar about $10, and a similar quantity of tomatoes around $20, based on recent surveys by the Gaza Governorate Chamber of Commerce in three cities. Although prices have decreased slightly as more supplies have entered, they remain significantly higher than pre-conflict levels.

Some Palestinians have resorted to selling personal belongings to afford food, while others depend on financial support from relatives abroad. Even those with bank accounts and regular salaries from international organizations face exorbitant fees—often around 50 percent commissions—to access their own money through intermediaries holding Israeli shekel cash reserves.

These intermediaries, who leverage their existing cash stockpiles to generate profits, typically operate from internet cafes or street corners in Gaza City, Deir al Balah, and Khan Younis. They offer physical banknotes to customers in exchange for online fund transfers, according to Gaza residents utilizing these informal services.