Informal Internet Service Providers and Their Potential Role in Promoting Digital Marketing and E-Payments in Gaza: A Case Study Report

Gaza’s digital economy has undergone a significant transformation under the conditions of prolonged conflict, infrastructure collapse, and widespread displacement. The destruction of telecommunications networks, commercial supply chains, and cash-based financial systems created an environment in which traditional business operations and formal digital services could no longer function reliably. In this context, informal Internet Service Providers (ISPs), Micro, Small, and Medium Enterprises (MSMEs), freelance workers, and digital payment platforms emerged as critical actors sustaining essential economic and communication activities.

The crisis exposed the profound vulnerability of Gaza’s formal telecommunications infrastructure, which is structurally weak, reliant on Israeli-controlled infrastructure, and severely restricted in technological development (Mourtada, 2025). By early 2025, nearly 64% of mobile network towers were out of service, and fixed-line connectivity remained heavily degraded (Palestinian Central Bureau of Statistics, 2025). This fragile system has been subjected to repeated, near-total telecommunications blackouts, plunging the population into digital darkness for days at a time and isolating them from communication, emergency services, and the outside world (EFF, 2025). Entire neighborhoods experienced extended periods without any functional formal internet coverage. Formal ISPs faced extensive damage to fiber routes, power supply infrastructure, switching equipment, and distribution cabinets. As a result, thousands of households, businesses, and humanitarian actors were cut off from the digital services required for communication, coordination, and financial transactions.

Within this vacuum, informal ISPs that previously operated at the margins of the telecommunications market rapidly assumed a central role. These operators, working with limited resources and improvised infrastructure, provided the only accessible connectivity for large segments of the population. Their networks enabled displaced families to communicate with relatives, allowed small businesses to receive orders, facilitated digital payment transfers, and supported humanitarian coordination. In some areas, informal ISPs effectively became the primary source of operational connectivity, serving as emergency digital infrastructure when formal systems were non-functional.

MSMEs faced similarly severe disruptions. Physical shops were destroyed or inaccessible, supply chains were fragmented, and formal delivery services were largely unavailable. Despite these challenges, many MSMEs adapted their operations through simple digital tools and community-based logistics. Microbusinesses used WhatsApp and Facebook to manage orders, relied on informal ISPs for minimal connectivity, and used e-wallet systems to complete transactions amid cash shortages. These adaptations represent a form of low-tech digital transformation driven by necessity rather than strategic planning.

Digital payments became an essential economic enabler during the collapse of cash infrastructure. With banking systems offline, ATMs destroyed, and cash circulation restricted, online banking applications and e-wallets, particularly PalPay, Jawwal Pay, and Bank of Palestine, provided households and MSMEs with a functional financial alternative. These platforms allowed individuals to send and receive funds, merchants to process transactions, and humanitarian actors to deliver assistance. Digital finance thus played a key role in maintaining economic continuity at the household and community level.

Freelancers and remote workers were another critical group affected by the crisis. Many relied on connectivity to access regional and international clients and digital labor markets. Despite bandwidth limitations and a documented environment of online censorship and shadow-banning of Palestinian content, freelancers reorganized their workflows around informal ISP access points, forming small working hubs and using low-bandwidth tools to remain active in the regional and global markets (7amleh, 2024). Their continued income generation provided economic support to households and contributed to local micro-economies inside displacement sites.

This case-study report, commissioned to the Palestine Economic Policy Research Institute (MAS) in partnership with Global Communities and funded by the Swedish Government, aims to document these lived experiences through seven narrative-driven case stories. The objective is to demonstrate how informal ISPs, MSMEs, freelancers, and digital payment users adapted their operations and sustained essential digital activities under extreme conditions. Rather than focusing solely on technical assessments, the report highlights human-centered operational realities and provides insights into the economic, social, and technological behaviors that emerged during the crisis.

By examining how Gaza’s digital ecosystem functioned without reliable formal infrastructure, the report offers practical lessons for humanitarian actors, policymakers, and private-sector stakeholders. It underscores the importance of decentralized connectivity, low-tech digital commerce, and flexible financial tools as components of digital resilience. As Gaza moves toward recovery and reconstruction, understanding these informal systems and the adaptive behaviors that supported them will be critical for designing effective, context-sensitive digital economy interventions (Wilson Center, 2024). The profound social resilience demonstrated by communities, often the only remaining foundation for survival as institutional and physical structures failed, must be central to any planning for the future.