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Palestinian Tech Firms Request Access to PayPal Platform in Open Letter to CEO

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In a letter addressed to PayPal CEO, Dan Schulman, 43 Palestinian tech companies and organizations have asked for the payment service to be made available to the nearly 4 million Palestinians living in the West Bank and Gaza Strip.

The letter cites how such a move could introduce more business opportunities in the area, effectively stimulating the Palestinian economy. Furthermore, the letter addresses the current PayPal dichotomy in the West Bank, where Israeli settlers are able to operate the service while their Palestinian counterparts cannot.

The open letter only came after PayPal rejected any moves for a formal meeting with Palestinian tech representatives. This move sparked a social media campaign in early September on Twitter, using the hashtag "#PayPal4Palestine".


Foreign Investment Sparks Palestinian Tech Growth

In a study conducted by Cisco, researchers found that the Palestinian IT sector has seen a 64% increase in foreign business since 2009. According to an article in The Guardian, in only two years, IT has grown from 0.8% of Palestinian GDP in 2008, to 5.0% in 2010. Despite all odds, this industry has managed to stay vibrant. One of the main reasons, as argued in the letter, is that tech is immune to the volatile borders and checkpoints that normally burden the trade of physical goods and services.

Most business and tech analysts say that Palestine's tech industry is most comparable to that of India. As in India, Palestine has become a popular market for software outsourcing. The nation's most abundant resource is its human capital; Palestine supplies nearly 2,000 graduates in the IT sector annually. Experts and business leaders hope that this is only the beginning of a Palestinian tech revolution.

Today, Palestinian startups and freelancers are using wire transfers to conduct business. This tends to be an unreliable and expensive way to exchange payment, potentially deterring future business partners. Introducing PayPal as a method of payment for Palestinian entrepreneurs and non-profits would be a good start to emulating Israel's booming tech sector, an industry who's annual profit approaches $1.3 billion.

Jasper Surrett, a senior Persian and Government & Politics student, notes that a strong Palestinian economy could go a long way toward stabilizing the Middle East as a whole.


In the West Bank, PayPal Registers Israeli Users, Not Palestinians

While Palestinians in the West Bank and Gaza cannot utilize PayPal's platform, Israeli settlers living in the West Bank can. Most PayPal users link their bank accounts to their profiles in order to send and receive payments, however, as it stands, PayPal does not recognize Palestinian banks, and Palestinians cannot register with Israeli banks. This is despite the fact that Israeli occupation in the West Bank is in violation of international law, according to the United Nations Security Council Resolution 446 and the Fourth Geneva Convention.

PayPal Dismisses Palestine's Request for Recognition

In a statement to TechCrunch, a news outlet specializing on technology and startups, PayPal has dismissed any immediate action:
PayPal's ambition is for everyone ultimately to have access to our services for digital payments and commerce, in accordance with applicable regulatory requirements. We appreciate the interest that the Palestinian community has shown in PayPal. While we do not have anything to announce for the immediate future, we continuously work to develop strategic partnerships, address business feasibility, regulatory, and compliance needs and requirements, and acquire the necessary local authority permissions for new market entries.
It is unclear as to whether any external political pressures have directly influenced PayPal's current stance, however Palestinian tech firms will likely look to re-engage the popular money transferring service in constructive discussions in the future.

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