Two major Israeli banks are set to end their banking relationships with Palestinian financial institutions raising concerns about a possible economic crisis in the Palestinian authorities
Israel Discount Bank will end its partnership on September 1, while Bank Hapoalim is expected to follow on October 1. The banks cited concerns over potential risks linked to terrorism financing and money laundering.
The decision comes amid the ongoing Gaza conflict and growing political tensions between the Israeli government and the Palestinian Authority.
Governor of the Palestinian Monetary Authority, Yahya Shunnar, warned that the move could destabilise the regional economy and disrupt financial transactions.
Israel’s Finance Ministry acknowledged the importance of the banking relationship, warning that ending it could weaken economic stability and drive more financial activity into unregulated cash channels.
Bank Hapoalim says it is still reviewing the matter.
