Technical and Financial Expert Report for the National Awareness Campaign on E-Commerce, Digital Marketing, and E-Payments in Palestine

Digital payments have become a foundational pillar of modern economies, enabling financial inclusion, efficient commerce, lower transaction costs, and greater transparency. Globally, digital adoption has accelerated dramatically over the past decade, reshaping how consumers, governments, and businesses interact within financial systems. Yet in Palestine, despite major progress in building a robust payments infrastructure and advancing key legal reforms, the economy remains overwhelmingly cash-based: 94% of daily transactions are still conducted in cash, only 19–22% of adults regularly use digital payments, and around 85% of MSMEs do not accept electronic payments. This contrast reflects a widening implementation gap between institutional readiness and actual user behaviour.

This report analyses the digital payments ecosystem using a supply–demand analytical framework. The supply side, represented by key institutions such as the Palestine Monetary Authority (PMA), the Palestine Capital Market Authority (PCMA), the Association of Banks in Palestine (ABP), the Ministry of National Economy (MoNE), Quds Bank, Arab Bank, and other stakeholders, has achieved significant advances in infrastructure, regulation, and operational capacity. These institutions have developed instant payment systems, national switching frameworks, interoperable billing platforms, e-cheque clearing, improved supervisory tools, and digital-transformation strategies aligned with global standards. Collectively, they form a strong, technically mature foundation capable of supporting a large-scale shift toward a less-cash economy.

The demand side, captured through focus groups conducted in Hebron and Ramallah, is characterised by low digital readiness, weak financial literacy, deep trust deficits, a preference for cash-based routines, and widespread informality among MSMEs. Consumers report fears related to fraud, errors, and online purchases, while merchants highlight the limited business value, they perceive in accepting digital payments. Many micro-enterprises lack the documentation, registration status, or operational incentives required to adopt regulated digital channels. This divergence between supply-side capacity and user behaviour creates a structural imbalance that slows national digital transformation.