Why does PayPal discriminate against Palestinians?

Why does PayPal discriminate against Palestinians?

Palestinian entrepreneurs at the University College of Applied Sciences Technology Incubator in Gaza City, in October 2016. Palestinian tech startups and freelancers face a major disadvantage because PayPal refuses to serve them.Ibraheem Abu MustafaReuters/Newscom
 
Jesse Rubin-30 May 2017
Dalia Shurrab, a content writer and translator based in Gaza, receives payment for her work through online money transfer platforms, like many freelancers around the world.
But she can’t use PayPal. Despite serving nearly 200 million users in 203 countries, PayPal denies its service to Palestinians – though not Israeli settlers – in the occupied West Bank and Gaza Strip.
“PayPal’s restrictions majorly disadvantage Palestinian startup and tech companies,” Shurrab told The Electronic Intifada, “essentially rigging the game in favor of their competitors in the rest of the Middle East and North Africa.”
The company cites regulatory concerns as the reason it denies service to Palestinians, although this ignores an established working relationship between the US Treasury and the Palestine Monetary Authority.
It also works in jurisdictions far less stable than Palestine, including Somalia and Yemen.
PayPal’s policy involves discrimination. Israelis living in settlements in the West Bank can use PayPal, while Palestinians are unable to. All of Israel’s settlements are illegal under international law.
The company did not respond to The Electronic Intifada’s repeated requests for comment.
Shurrab, who lives in Beit Hanoun in the northern Gaza Strip, is – like Gaza’s two million other residents – subject to Israel’s 10-year blockade of the territory. This makes it almost impossible for her to leave Gaza through any Israeli-controlled checkpoint.
With draconian restrictions on freedom of movement and the import and export of goods and basic materials, Gaza’s economy has tanked, leaving the coastal strip on the brink of collapse.
According to the World Bank, Gaza’s general unemployment rate was 42 percent in 2016 and soared to 58 percent among youth.
To Shurrab, this stark reality also presents an opportunity.
“Entrepreneurship in the Gaza Strip, and generally in Palestine, is growing so fast,” Shurrab said. “It’s opening closed doors for these youth to find new experiences and to live their passion and make their dreams come true and be their own bosses without contributions from other governments or the private sector.”
Shurrab got her first break at Gaza Sky Geeks, an incubator for startups, tech innovation and education.
Half of the startup founders supported by Gaza Sky Geeks are female, a proportion the company aims to increase to 80 percent.
Shurrab considered one day launching her own startup, but was forced to abandon the plan given lack of access to payment.
“Because PayPal does not operate in Gaza,” Shurrab said, she rarely receives payment for her freelance work.
Heavy international anti-terrorism and anti-money laundering restrictions imposed on Hamas-governed Gaza make regular bank-to-bank transfers expensive and cumbersome, as they are subject to monitoring by Israel and the United States.
Other money transfer platforms such as Western Union or MasterCard’s Payoneer are accessible to Gazans, but high transaction fees discourage their use.

Despondent

Despite the surge of Gaza’s startup industry, PayPal’s refusal of service inhibits the potential of so many like Shurrab. The freelancer, once chosen to represent Palestine at the sixth annual Global Entrepreneurship Summit in Kenya, told The Electronic Intifada that she is despondent.
“Unfortunately, my business has stopped.”
Since 2015, Palestinian business representatives have insisted that PayPal provide services to the West Bank and Gaza.
Americans for a Vibrant Palestinian Economy, an organization that advocates for investment in Palestine, penned a letter in August 2016 to PayPal CEO Dan Schulman urging the company to extend its services to Palestinians, thereby “removing a major limitation on the Palestinian technology sector.”
It noted that tech is “one of the only sectors with the potential to grow under status quo conditions of the Israeli occupation.”
The letter was signed by 43 Palestinian companies, primarily from the startup and tech field.
Today, Gaza Sky Geeks manages 27 startups, although the total number of Gaza-based tech companies is presumably higher.
Fadi Saba, a California-based organizer of the PayPal for Palestine campaign, likened PayPal’s refusal to onerous Israeli restrictions on the Palestinian economy.
Palestinians need permission from countless Israeli authorities just to transport produce a few miles, a lengthy customs procedure that has caused exports to spoil.
“The lack of PayPal access to Palestinians is similar to the tactic of stopping Palestinian produce exports,” Saba told The Electronic Intifada, “or [like] those physical checkpoints.”
The United Nations has warned that by 2020, Gaza will be uninhabitable should the Israeli blockade continue.

“You will be tested”

In response to a query by The Electronic Intifada, Tura Winery – located in an Israeli settlement near the West Bank city of Nablus – confirmed that it accepts payment for its olive oil through PayPal.
In January 2016, Human Rights Watch warned companies that doing any business in or with Israeli settlements would “unavoidably contribute to Israeli policies that dispossess and harshly discriminate against Palestinians, while profiting from Israel’s theft of Palestinian land and other resources.”
“If [PayPal is] going to be in the same physical area they should make the service available to all people,” Granate Sosnoff, a Jewish Voice for Peace representative told The Electronic Intifada.
Dan Schulman, CEO of PayPal, is officially committed to “corporate social responsibility.”
But the language of corporate social responsibility has become so widespread that it can often read as unintentional parody.
A 2016 article by Schulman for Time magazine is a good example.
Schulman wrote that the “questions ‘why do we exist as a company?’ and ‘how do we make a difference?’ need to have the same answer.”
A company will need to turn a challenge into an opportunity: “The opportunity to prove to the world that your values aren’t just something written on a wall – that your mission is not opportunistic – it is the North Star. You will be tested.”
“This is a company that very much wants to be seen as supporting human rights,” Seth Leibson, a spokesperson for the South Bay chapter of Jewish Voice for Peace, told The Electronic Intifada, but “they’re clearly failing to do so” in Palestine.
While exact numbers are difficult to ascertain, the number of Gazan freelancers increased from mere tens in 2014 to hundreds by 2015, according to Taysir Shaqalaih from Mercy Corps, a US organization and main backer of Gaza Sky Geeks.
The rapid growth of the Palestinian IT freelance sector has further empowered the campaign demanding an end to PayPal’s discrimination.
Since the initial 2015 meeting between Palestinian businesses and PayPal, a coalition of local and national Palestine solidarity organizations has taken up the issue.
In 2016, the South Bay Palestine Organizing Coalition, the US Campaign for Palestinian Rights, Jewish Voice for Peace and others began an online petition to “Tell PayPal to end its discrimination against Palestinians.”
In November, the coalition launched a social media campaign but the company still refused to make any specific comments.
Finally, two PayPal representatives – Richard Nash and Justin Higgs – agreed to meet activists at the company’s San Jose headquarters earlier this month.
The meeting proved unsuccessful.

Corporate apathy

According to Noam Perry, a campaigner who attended, the PayPal representatives acknowledged that the situation had become a concern and that they have a moral obligation to fight discrimination.
“However, they admitted that they have not made any meaningful progress on this issue, and declined to make any commitments, even remote ones,” Perry, who works for the American Friends Service Committee and is a member of Jewish Voice for Peace, told The Electronic Intifada.
On 16 May dozens of activists held a rally outside the company’s San Jose headquarters.
They delivered 15 boxes representing more than 180,000 petition signatures collected online.
PayPal’s Higgs engaged with the protesters outside his office.
“It is a complex issue from a compliance and regulatory standpoint,” Higgs told activists. “But that’s not to say that we’re not serious about our business and democratizing financial services for the people all around the world, not just Palestine.”
Although he accepted the petition on behalf of PayPal, Higgs gave no commitments about when the company would take specific steps to change its policy. Organizers vowed to keep up the pressure, including more protests, until their demands are met.
Meanwhile, the US Campaign for Palestinian Rights attempted to deliver the petition to PayPal’s Washington, DC, office but were turned away.
Despite the obstacles that Gaza and West Bank entrepreneurs face, “the tech folks in San Jose are just like those in Palestine,” campaigner Fadi Saba said.
“They want to depend on themselves, they want to be self-sufficient – they want a fishing pole to catch their own fish.”
Jesse Rubin is a freelance reporter and regular contributor to The Indypendent, a New York-based publication. Twitter: @JesseJDRubin.
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