Israel extends cooperation between Israeli and Palestinian banks

Israel's finance minister has extended a waiver that allows cooperation between its banking system and Palestinian banks in the occupied West Bank, a ministry spokesperson said on Sunday.

Israel’s finance ministry wields extensive control over Palestine’s economy, which relies heavily on this relationship to process transactions made in Israeli shekels. 

Israel, which collects tax on goods that pass through Israel into the West Bank on behalf of the Palestinian Authority, has repeatedly withheld Palestinian tax revenues during the war on Gaza.

In March, Finance Minister Bezalel Smotrich threatened to paralyse the Palestinian Authority's economy in response to the United States imposing sanctions on four West Bank extremist settlers accused of violence against Palestinians.