After more than eighteen months of war, Hamas is exhibiting signs of financial strain that could escalate and possibly destabilize the organization. According to an April 16 report in The Wall Street Journal, Hamas has been unable to pay its fighters as a result of Israeli operations against the group’s financial infrastructure.
The report is significant because adequate financial resources are essential for Hamas’s ability to maintain its operational capacity. In this context, Israel’s targeted efforts to cripple Hamas’s financial infrastructure may prove more detrimental to the group’s long-term viability than the elimination of its commanders, foot soldiers, or military assets.
Several instances during the war illustrate Israel’s efforts to undermine Hamas’s financial infrastructure. On December 19, 2023, the Israel Defense Forces (IDF) and the Shin Bet intelligence agency announced that they eliminated Hamas Subhi Ferwana, a key Hamas financier responsible for transferring tens of millions of dollars to the group.
The IDF alleged that Ferwana and his brother operated the money exchange company Hamsat, which has served as a financial conduit for Hamas in recent years. In the first months of the conflict, Ferwana facilitated significant fund transfers to support the group’s military capabilities, including paying fighters’ salaries and financing war-related activities.
Hamas relies on such financiers to channel funds from Iran and other international sources, utilizing money laundering and netting methods to evade global financial monitoring systems. Ferwana’s elimination represented a blow to Hamas’s financial infrastructure and its ability to sustain military operations.
Another example illustrating the critical role Gaza-based money exchangers play in financing Hamas occurred on April 4, when the IDF and the Shin Bet announced that a targeted airstrike in the Gaza City area had eliminated Saeed Ahmad Abed Khudari, a central figure in Hamas’s financial network. Khudari operated as a money exchanger and led the Al Wefaq Company, which Israel had designated a terrorist organization due to its role in channeling funds to terrorist groups.
Khudari played a central role in facilitating financial transfers to Hamas’s so-called military wing, particularly after the October 7 massacre, the IDF said. His activities intensified following the Israeli elimination of his brother, Hamed Khudari, who previously served as a financial conduit for Hamas’s military operations.
Beyond the death of his brother, there were warning signs that Israel had identified Saeed as a potential target before his elimination. On September 29, 2023, the Israeli news site Walla! implicated Saeed and other Palestinians in a financial scheme that involved the transfer of Iranian funds to armed groups in the West Bank. The report named the Al Wefaq Company, where Saeed worked, as an entity Hamas used to move funds earmarked for terrorism to the West Bank.
Separately, Hamas has robbed banks to secure funds for its operations. According to allegations made by the IDF, Hamas orchestrated the theft of hundreds of millions of shekels from banks in Gaza City in February 2024. The group recognized that a prolonged war with Israel loomed, along with the necessity of securing financial resources to sustain its operations throughout the most intense conflict in its history. Hamas’s economic burden is significant, with thousands of fighters receiving monthly stipends averaging between $200 and $300.
Additionally, Hamas’s revenue stream from diverting humanitarian aid has diminished considerably following Israel’s decision to stop humanitarian assistance to Gaza, a measure taken in response to Hamas’s refusal to agree to a ceasefire proposed by US Special Envoy to the Middle East Steve Witkoff.
Hamas officials have not publicly acknowledged any signs of financial distress. Nevertheless, the group routinely posts messages on social media soliciting donations to support its activities.
Hamas’s deteriorating financial condition represents a strategic advantage for Israel as it intensifies military pressure on the group. Coupled with growing public dissent and protests against Hamas by some Palestinians in the Gaza Strip, Israel may be positioned to exploit the group’s emerging vulnerabilities.
