Palestine Monetary Authority meets government and private sector to expand electronic payments and mitigate ILS liquidity accumulation

The Palestine Monetary Authority (PMA) held a series of meetings with government and private-sector stakeholders to agree measures to accelerate electronic payment adoption and reduce the excessive accumulation of Israeli shekel (ILS) liquidity in the domestic banking sector. The work sits within the PMA’s digital transformation strategy and follows a briefing by Governor Yahya Shunnar to Prime Minister Mohammed Mustafa and relevant ministers on the causes of the ILS surplus, which the PMA said has worsened since the events of October 7. The Federation of Chambers of Commerce, Industry, and Agriculture and other private-sector representatives agreed to expand electronic payment services and point-of-sale (POS) systems across businesses and retail outlets to reduce reliance on cash and associated theft and counterfeiting risks. The PMA also issued directives to banks stressing close cooperation with sectors supplying essential goods, support for foreign trade financing, and a constructive approach to managing individual cash deposits, while urging merchants, banks and electronic payment service providers to broaden the use of digital wallets, mobile and card payments, modern POS devices and the iBURAQ instant payment system. Against what it described as the Israeli side’s continued refusal to facilitate repatriation of excess ILS banknotes from Palestinian banks to Israeli banks, the PMA said it is intensifying local and international diplomatic and technical efforts to enable timely cash transfers and is exploring alternative measures, including a potential shift toward an alternative currency and reduced reliance on the ILS as the primary medium of exchange.