Jalal Zayed, 33, a father of two from the Kafr ‘Aqab neighborhood in northern Jerusalem, described how restrictions on the banking system since 7 October have disrupted his cigarette and tobacco business

My brothers and I have two shops, which specialize in selling all kinds of cigarettes and tobacco, in the neighborhoods of Kafr ‘Aqab and Samiramis. These shops are our only source of income. We’ve been in this business for at least five years, and we work both with wholesalers and directly with company representatives.

My brothers and I have two shops, which specialize in selling all kinds of cigarettes and tobacco, in the neighborhoods of Kafr ‘Aqab and Samiramis. These shops are our only source of income. We’ve been in this business for at least five years.

We’d usually pay the wholesalers and company representatives in [Israeli] shekels, in cash, and sometimes, we’d deposit money in the bank to pay some of the wholesalers by check. There were no restrictions on how much we were allowed to deposit into the account or when we could do it, but that has completely changed.

At the beginning of 2025, company representatives and wholesalers began hinting that they would soon stop accepting cash payments in shekels, because the banks had informed them there was a problem with amassing large Israeli cash reserves, which Israeli banks refused to exchange. At first, we didn’t think much of it, because the issue had come up in the past but we were still able to pay in Israeli cash. This time, however, during the 12-day war with Iran, the wholesalers, distributors and company representatives really did refuse to take cash payment in shekels, and informed us that from now on they would only accept cash payments in foreign currency, US dollars or Jordanian dinars.

At the beginning of 2025, company representatives and wholesalers began hinting that they would soon stop accepting cash payments in shekels, because the banks had informed them there was a problem with amassing large Israeli cash reserves, which Israeli banks refused to exchange.

We had no choice but to start exchanging the Israeli cash we had for foreign currencies, but that forced us to buy foreign currency from moneychangers, who sell it at rates higher than the official exchange rates, while the companies, through their representatives, and the wholesalers sell only at the official exchange rate. This caused me, on average, a loss of 12–15 ILS (~ 3.90–4.90 USD) on every 100 USD between buying and selling.

These measures forced us, the shop owners, to raise the consumer price of a pack of cigarettes by 1 ILS (~ 0.33 USD). Most shop owners did this, although it wasn’t official pricing published by the shops, to offset the loss incurred from paying in foreign currency. This continued throughout all 12 days of the war.

When the war ended, the companies informed us, through their representatives, and the wholesalers, that beginning that day, they would once again accept cash payment in shekels, in exchange for raising the price of each carton of cigarettes, 10 packs of cigarettes, by 10 ILS (~ 3.33 USD). They also gave us another option: cash payment in foreign currency or by bank transfer.

It was the first time that the option of payment by bank transfer was raised, and for us, the shop owners, it was a better option because it allowed us to sell cigarettes at the old price. But then we discovered that the banks had set a cap on monthly deposits. Before that, there was no upper limit and we could deposit any amount we wanted. The deposit cap they set was 5,000 ILS (~ 1,625 USD) a month, which isn’t enough for a commercial shop even for one day’s payments.

The cigarettes alone that I buy every month are worth at least 60,000 ILS, and even though I use two banks, I can deposit a total of only 20,000 ILS a month, 10,000 in each. What am I supposed to do for the rest of the month? I was forced to open accounts with more banks I hadn’t worked with before, and to use the bank accounts of all my family members.

After several attempts with the banks, the Palestinian banks agreed to raise my deposit cap to 10,000 ILS (~ 3,250 USD) a month, but that still doesn’t solve the problem. The cigarettes alone that I buy every month are worth at least 60,000 ILS (~ 19,525 USD), and even though I use two banks, I can deposit a total of only 20,000 ILS (~ 6,500 USD) a month, 10,000 in each. What am I supposed to do for the rest of the month?

I was forced to open accounts with more banks I hadn’t worked with before, and to use the bank accounts of all my family members, including personal accounts, to split up the deposits and cover the full value of my purchases and my monthly obligations in checks. I also had to agree to pay in cash in Israeli shekels and, as a result, to raise the price of each pack of cigarettes by 1 ILS (~ 0.33 USD).

Since the events of 7 October 2023, the banks have been reluctant to issue check books, and we used to pay by check for many of the shops’ needs. [...] Using checks has become a problem, because the banks don’t allow deposits above the cap.

We also have a problem using checks because since the events of 7 October 2023, the banks have been reluctant to issue check books, and we used to pay by check for many of the shops’ needs. In any case, the cash deposit limit is not enough to cover our purchases in cash or by bank transfer, so even if we had checkbooks, we’d have no way to cover purchases made with them.

In other words, using checks has become a problem, because the banks don’t allow deposits above the cap, even if there are checks that must be covered. After I repeatedly approached the banks, they offered to install electronic point-of-sale (POS) terminals in the stores, enabling payment by credit and debit card, but our customers aren’t used to paying that way and it wasn’t a good solution for us. So our only remaining option was to buy foreign currency to pay suppliers, which meant taking a loss.

All these restrictions have created many problems for us, such as severe stock shortages, because we can’t pay in cash in shekels or deposit enough money into our bank accounts to pay by check, plus we don’t even have enough checks. Now our shops are out of all kinds of stock, and people have looked for alternatives and gone to buy cigarettes on the black market, like smuggled cigarettes on which no customs were paid. We’ve also had to waste time every day going to the banks to deposit the value of our daily purchases and the value of the checks we issued.

• Testimony given to B’Tselem field researcher Mohammad Romaneh on 31 May 2026