‘No Space for Everyone’: Rafah Overwhelmed with Fleeing Gazans

Internally displaced Palestinians seek refuge inside makeshift shelters in Rafah camp in the southern Gaza Strip, February 02, 2024. (EPA)
Internally displaced Palestinians seek refuge inside makeshift shelters in Rafah camp in the southern Gaza Strip, February 02, 2024. (EPA)
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‘No Space for Everyone’: Rafah Overwhelmed with Fleeing Gazans

Internally displaced Palestinians seek refuge inside makeshift shelters in Rafah camp in the southern Gaza Strip, February 02, 2024. (EPA)
Internally displaced Palestinians seek refuge inside makeshift shelters in Rafah camp in the southern Gaza Strip, February 02, 2024. (EPA)

Tens of thousands of people crammed into a street in Rafah, the southern Gaza city where vast numbers have sought refuge from advancing Israeli ground troops.

"These are the worst months of our lives," said Noha al-Madhun, who fled from the Beit Lahia area of northern Gaza and was taken in by relatives along with some of her children.

"My husband and eldest sons sleep in a tent. There's no space for everyone. We sleep on the floor and we feel the cold" without enough blankets to go round, she said.

"There aren't enough apartments or even places to set up extra tents," added Madhun.

More than half of Gaza's population of 2.4 million is in Rafah, on the border with Egypt, according to the United Nations.

Those without relatives to host them or the means to rent apartments have found themselves in tents wherever there is space: along streets, in public squares, sports stadiums or parks.

Abdulkarim Misbah, 32, said he left his home in the northern Jabalia refugee camp and reached Khan Younis, only to be uprooted once more.

"We escaped last week from death in Khan Younis, without bringing anything with us. We didn't find a place to stay. We slept on the streets the first two nights. The women and children slept in a mosque," he said.

Then they received a donated tent, setting it up right beside the Egyptian border.

"My four children are shivering from the cold. They feel sick and unwell all the time," said Misbah.

Forced to flee south

Most people are concentrated in the city center or west, trying to avoid the eastern edges towards the Israeli border or the north which is dangerously close to fighting in nearby Khan Younis.

After the war erupted on October 7 with Hamas militants' unprecedented attack on Israel, the country's military ordered Gazans to leave their homes in the north.

Those instructions have since expanded, forcing many Palestinians to flee time and again.

Gaza City resident Amjad Abdel Aal, who fled to a school shelter in Rafah, said it took her two hours to be driven a distance which before the war would take just 15 minutes.

"The congestion was awful," she said, waiting in a wheelchair in a long line for donations of blankets and mattresses.

"There aren't a lot of cars because of the fuel shortage. Everyone walks, rides a truck or donkey cart," added the barefoot 28-year-old.

The United Nations estimates 1.7 million have been forced from their homes by the war since October 7.

The Hamas attack on Israel resulted in the deaths of around 1,160 people, mostly civilians, according to an AFP tally based on official figures.

Israel's withering offensive has killed at least 27,131 people in Gaza, mostly women and children, according to the health ministry in the Hamas-run territory.

'Death is more merciful'

With Egypt's border shut to most Gazans throughout the war, the streets of Rafah have become packed with displaced people.

Mehran Dabbabish, 41, a taxi driver from Khan Younis, said the situation was "getting worse by the day".

"The road between Khan Younis and Rafah used to take 20 to 30 minutes at worst. Today, the shortest trip within Rafah takes an hour and a half to two hours," he told AFP.

The overcrowding is putting a massive strain on everyone and means moving anywhere, by any means, is incredibly difficult.

Another Gazan, Naima al-Bayumi, lamented how tired she was just halfway through a four-hour journey by foot to visit her relative in hospital.

"I rode a donkey cart a few times and fell off because of the intense scramble," she told AFP.

Bayumi started crying as she recounted the bombardment which hit her home, killing her baby twins.

"I gave birth to them in the first week of the war, after 13 years of marriage," said the 38-year-old, who lives in a tent with her husband.

"I don't want to live anymore," she said.

Elsewhere on the road, people helped another woman clamber aboard a truck filled with dozens of passengers.

She clung to the side of the truck with her baby, to stop them falling out, and screamed: "Death is more merciful than this life!"



Cash Shortage Squeezes Gaza Residents

Palestinian children queue for a hot meal at a charity kitchen in Gaza City on April 30, 2025. (Photo by Omar AL-QATTAA / AFP)
Palestinian children queue for a hot meal at a charity kitchen in Gaza City on April 30, 2025. (Photo by Omar AL-QATTAA / AFP)
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Cash Shortage Squeezes Gaza Residents

Palestinian children queue for a hot meal at a charity kitchen in Gaza City on April 30, 2025. (Photo by Omar AL-QATTAA / AFP)
Palestinian children queue for a hot meal at a charity kitchen in Gaza City on April 30, 2025. (Photo by Omar AL-QATTAA / AFP)

Even when food is available, many in Gaza cannot afford to buy it, as the enclave suffers from a severe cash shortage. Israel has blocked the entry of new currency into the territory since October 7, 2023, leaving residents at the mercy of money changers who have hiked exchange rates on remittances to exorbitant levels.

Palestinians in Gaza primarily rely on the Israeli shekel for daily transactions, which used to enter the strip through banks operating under the Palestinian Monetary Authority, supplied by the Bank of Israel.

Banking operations in Gaza have ground to a halt since the start of the war, and no fresh banknotes have entered the enclave, worsening an already dire humanitarian situation. Residents say they have been left at the mercy of traders who exploit the cash shortage to impose arbitrary rules on currency use.

'The Traders’ Game'

Dubbed “the traders’ game” by many in Gaza, the practice began with merchants refusing to accept worn-out banknotes and certain coins, such as the 10-shekel piece (worth about $3), which have all but vanished from local markets. Some vendors now reject older versions of bills - like the brown-hued 100-shekel note (around $28) - insisting instead on the newer yellow ones. The same rules apply to various denominations.

Speaking to Asharq Al-Awsat, Hani Jahjouh, a resident of al-Shati Camp west of Gaza City, said vendors selling vegetables and essential goods - when available - often refuse worn banknotes or specific coins, claiming they are counterfeit or easily faked.

“This just adds to the burden of people already crushed by impossible living conditions,” said Jahjouh, 59. “We don’t have solutions. We don’t even know where to get the money they’re asking for.”

Only a very small number of traders accept digital payments, and even then, residents say, they impose tough conditions - such as inflated prices or demands for partial payment in cash.

Displaced Gazan Duaa Ismail, originally from Beit Hanoun in the north of the enclave, says even when goods are available, she cannot afford them due to a lack of cash.

“We’re suffering badly from a shortage of money, and that makes it even harder to get basic items like flour and sugar - when they’re even in stock,” she told Asharq Al-Awsat from a shelter in Gaza City’s Sheikh Radwan neighborhood.

Ismail said that during a brief ceasefire, some traders had accepted digital payments through mobile apps. “But once the war resumed, things worsened, and they stopped taking them altogether,” she said.

Salaries They Can’t Spend

The crisis has also hit public-sector employees, private workers, and international aid staff, many of whom receive salaries through bank transfers or mobile wallets but have no way of accessing their funds with banks shuttered. They are forced to rely on currency dealers or traders with access to physical cash.

Amjad Hasballah, an employee with the Palestinian Authority, said he has been cashing his monthly salary through mobile banking apps for over a year and a half, paying a steep commission to money traders in return.

“When I received my last salary in early April, the commission had reached 30%,” he said.

Speaking to Asharq Al-Awsat, Hasballah explained that at the start of the war, commissions hovered around 5%, but they spiked during Ramadan, peaking at 35% around Eid al-Fitr, before dipping slightly to 30%.

“My salary is just 2,800 shekels. When I pay a 30% fee, there’s barely anything left,” he said bitterly. “At this point, the traders might as well take the whole salary and just give us pocket money.”

Caught in a Trap

Jamal Al-Mashal, a father of six who lost two children in an Israeli airstrike, said he lives off 1,000 shekels (about $280) in monthly international aid. But even that amount is slashed by up to 30% when he exchanges it through local traders.

“People in Gaza have become a cash trap for currency dealers and big traders,” he said. “They’re exploiting our desperation, and it’s like a harvest season for them - raking in profits while we suffer.”

The poorest and most vulnerable are hit hardest. Many international agencies rely on electronic payment platforms to distribute aid to these groups, who often have no access to physical currency.

No Oversight, No Restraint

The Hamas-run government has made attempts to cap commission rates at 5%, but those efforts have largely failed. Officials blame ongoing Israeli targeting of personnel involved in regulating the process.

Money changers defend the high fees, arguing that the lack of currency entering Gaza leaves them with limited options.

“We raise commission rates because there’s simply no new cash coming in,” one trader told Asharq Al-Awsat. “Once money is distributed to the public, we have no way of getting it back. What goes out doesn’t return.”

He added that while ministries and law enforcement have tried to impose limits, traders view the rules as unfair. “There have been attempts to regulate us, but we haven’t complied - they’re asking too much from us under impossible conditions,” he said.

Some municipal leaders and community elders in Gaza have recently appealed to the Palestinian Monetary Authority in Ramallah to intervene in what they describe as unchecked profiteering by traders controlling access to scarce cash.

They have called for greater oversight, including monitoring and freezing the traders’ bank accounts.

The authority has repeatedly warned against exploitation of civilians and threatened to take action. But in practice, traders continue to charge hefty commissions on money transfers with little deterrence.

The Authority has urged residents to use its Instant Payment System available through mobile banking apps, which it says offers a practical alternative to cash, promotes digital payments, and enables real-time transactions.

Cash Squeeze Tightens Further

Despite the hardship, Israel is considering new measures that could further tighten the financial stranglehold on Gaza. One proposal involves withdrawing the 200-shekel banknote (worth about $55) from circulation, on the grounds that Hamas allegedly uses it to pay salaries to its fighters.

The suggestion was reportedly made by Israeli Foreign Minister Gideon Sa’ar to Bank of Israel Governor Amir Yaron, who rejected the move. Other proposals include voiding the serial numbers of banknotes believed to be inside Gaza, effectively rendering them worthless, a step that could deliver a significant financial blow to Hamas.

According to a report published Tuesday by the Israeli daily Maariv, the proposal has backing from several ministers and economists both within and outside the central bank.

The report estimated that around 10 billion shekels in high-denomination bills - 100 and 200 shekels - remain in circulation within Gaza. These notes entered the enclave over the years through official banking channels supplied by the Bank of Israel.

Economists told Maariv that Gaza residents receive an estimated 150 to 200 million shekels each month through digital transfers from aid organizations and the Palestinian Authority. That money is then converted into cash within markets dominated by Hamas and supported by a network of money changers.

Israeli security sources estimate that Hamas has accumulated up to five billion shekels since the war began and has spent nearly one billion shekels on salaries for fighters and new recruits. The sources claim Hamas has profited significantly by reselling aid and fuel at inflated prices during the conflict.