RAMALLAH, June 28, 2026 (WAFA) – Deputy Governor of the Palestinian Monetary Authority (PMA) Mohammad Manasra said today that the growing accumulation of Israeli shekels in the Palestinian banking sector is primarily the result of Israeli restrictions on transferring surplus cash, stressing that the PMA is pursuing multiple tracks to address the crisis while expanding electronic payment systems.
In an interview with WAFA, Manasra said the law aimed at reducing cash transactions is not intended to burden citizens, but rather to build an economy that relies more heavily on electronic payments, which are more efficient and secure. He stressed that comprehensive implementation of the law requires first establishing a fully integrated electronic payments infrastructure and ensuring services are accessible across all sectors and regions.
He said the PMA has held a series of meetings with representatives of the private sector, chambers of commerce, and professional unions, resulting in a plan for the gradual implementation of the law over a two-year period, taking into account the specific needs of each economic sector.
He added that addressing the shekel accumulation crisis must go hand in hand with implementation of the law before executive regulations are issued.
Manasra noted that, given Israeli restrictions on shipping excess cash, continued reliance on paper currency is no longer sustainable, making the expansion of electronic payment systems an economic necessity.
Addressing reports that some banks have refused to accept shekel deposits from customers, Manasra said the PMA is monitoring the issue daily and fully recognizes the hardship faced by citizens and businesses.
He explained that the problem does not stem from the banks' unwillingness to accept deposits but from Israeli restrictions on transferring surplus shekels out of the Palestinian market.
According to Manasra, the current annual transfer ceiling of approximately 18 billion shekels no longer reflects the volume of cash circulating in the Palestinian economy. He said the PMA is working directly with the Bank of Israel and international partners to increase the transfer quota or authorize additional shipments.
He added that while the issue had previously been managed directly between the PMA and the Bank of Israel, responsibility shifted to the Israeli government after October 2023. Nevertheless, he emphasized that banks must continue accepting shekel deposits, particularly from key economic sectors, to ensure the continuity of payments, trade financing, and the supply of essential goods.
He said the swap operations have also resulted in the freezing of approximately $9.5 billion in banking assets, including accumulated cash reserves, stressing that Palestinian traders are bearing the burden of a crisis beyond their control.
He stressed that banks are required under PMA regulations to accept deposits when the source, amount, and nature of the funds are consistent with the account holder's financial activity. He encouraged anyone facing unjustified refusal to file a complaint directly with the PMA for investigation.
Manasra warned that any termination of correspondent banking relations by the Israeli side would have far-reaching consequences for supply chains and international payments, potentially affecting imports of essential goods and services, including electricity, fuel, and water.
He said the PMA continues to work with local and international partners to prevent such an outcome and preserve the stability of the Palestinian economy.
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