Cash Working Group - Gaza Strip: Mobile money and e-wallet modalities: Gaza CWG guiding note – June 2024

The purpose of this paper is to discuss the most recent developments in regard to mobile money and e-wallet in Gaza and to discuss concerns and opportunities of CWG actors.

Background

Since the outbreak of the conflict on the 07th of October 2023, cash actors in Gaza have delivered at least one payment of Emergency MPCA to over 178 thousand HHs, comprised of over 1.2 million people. The vast majority of cash assistance has been distributed via the PalPay financial service provider network, through a system of PIN codes sent to the mobile phones of targeted recipients, who could cash out their entitlements at PalPay’s cash out agents. Liquidity for cash outs is accessed by PalPay agents through Bank of Palestine (BoP) ATMs and over-the- counter withdrawals whenever possible based on safety and security situation.

Liquidity challenges

Starting from March 2024, access to liquidity has increasingly become problematic, due to a) the concentration of people in small areas1 that create pressure on the local financial institutions by increasing demands for cash and liquidity, b) the immense logistics, safety and security challenges in moving cash from and between banks and ATMs, and c) the irregular trends of deposits of cash from businesses and traders into banks. This has negatively impacted the economic sector, and, without long-lasting solutions, can potentially affect many elements of public and humanitarian operations, including the payment of PA and UNRWA staff salaries, humanitarian agencies’ operations, payment of salary for local staff, procurement, as well as humanitarian cash transfer response.

Palestinian authorities and international humanitarian actors have been exploring solutions to mitigate the impact of liquidity crisis in the Gaza Strip. Steps undertaken by authorities – primarily the Palestinian Monetary Authority (PMA) – move in two directions: 1) the request for Israeli approval for the import and operation of armoured vehicles to be used for safe collection, transportation, and distribution of physical cash, (approval is still pending), as well as spare parts and fuel for ATM machines and 2) the re-launch and strengthening of mobile money. The latter is the focus of this paper.