Decades of sanctions and a war that has tightened them further have pushed Iranians toward currency exchangers, intermediary firms, private deals and crypto. Every workaround moves money, and every one charges a price.
Published 14 October 2026 · 09:18 GMT
Decades of international sanctions have severely restricted Iran's access to the global financial system, making cross-border payments difficult for individuals and businesses alike. That pressure has only increased during the current war involving the United States and Israel, which has disrupted trade routes, frightened off intermediaries and deepened the isolation of an economy already cut off from much of conventional banking.
Unable to rely on conventional banking for international transactions, many Iranians have turned to alternative channels to pay for goods and services abroad. The main routes are networks of currency exchangers operating across borders, intermediary firms that settle payments from funds held overseas, private arrangements between individuals, and cryptocurrency. Each workaround offers a way around some of the restrictions, and each comes with its own costs and risks.
None of them matches the security, reliability and efficiency of a functioning international banking system. The channels can fail, the money can disappear, and the price of moving it keeps rising. And even when a payment route works, a second problem remains: what Iranians can afford keeps shrinking, because the rial has lost more than 10 percent of its value against the dollar in the past month, more than 55 percent in the past year and almost 90 percent in the past five years.
The oldest workaround is the network of currency exchangers that operate across borders. It is an informal system that matches those who need local currency in Iran with those who need foreign currency abroad. By balancing these opposing needs, transactions can be settled without money necessarily moving directly between Iranian and foreign bank accounts. Trust, reputation and long-standing relationships do the work that clearing houses do elsewhere.
Intermediary firms offer a service comparable to that of the currency traders, on a more organised footing. Typically, a customer pays the intermediary in local currency in Iran, while the firm or an overseas partner arranges payment to the foreign supplier in a convertible currency, using funds held abroad. The supplier is paid, the customer never touches the international banking system, and the firm takes a margin for bridging the gap.
Both routes help bridge the gaps in international banking access, but both involve additional fees, exchange-rate costs, delays and greater complexity. The collapse of the rial has already forced a political reckoning in Tehran, and every extra point of spread on a transfer lands on households and firms already squeezed by depreciation and inflation.
Other Iranians do not deal with companies at all. They resort to private arrangements with individuals, including people they do not know personally, to transfer money across borders. Those deals may offer a practical solution when formal channels are unavailable, but they rely heavily on trust rather than enforceable guarantees. An Iranian IT manager living in Germany, identified only as Reza, described deals in which strangers must trust one another to complete a transaction with no legal documentation or proof, where either side can walk away at any moment and leave the other out of pocket.
The methods used, whether through companies or individuals, are informal and far from secure. Ashkan Bahrami, an Iranian trade expert, has described how Iranians must use informal exchange and remittance systems for international trade, carrying risks such as lost funds, fraud and high transfer costs. These networks are also vulnerable to geopolitical shocks: some operating through Gulf countries have been disrupted by the war, adding another layer of uncertainty for the businesses and individuals who depend on them.
By their nature, informal flows leave little paper trail, so the true volume moving through exchangers, intermediaries and private deals is not publicly measured and no reliable official tally exists. It is also not known how much of the activity Washington would class as sanctions evasion and how much is ordinary people paying for medicine, study, family support or lawful trade. That distinction matters for enforcement, but the data to draw it is not available.
It is not known how many of the networks operating through Gulf countries have been disrupted by the war, or whether they will recover. It is not known whether further designations will target more exchanges or wallets, or how far periodic internet disruptions will go in cutting off the crypto route. What is clear is that every closure pushes users toward the next workaround, at higher cost.
For Iranians, this is daily life: the ability to pay a supplier, receive money from family abroad, or buy imported goods. When the channels clog, trade stalls and prices rise. For businesses importing physical goods, the challenges extend beyond payment itself. War-related disruptions and restrictions, particularly after the US naval blockade on Iran, have complicated transportation, lengthened delivery times and increased uncertainty over when shipments will arrive.
Arghavan Ghazanfari, chief executive of Aron Trading Group, described the scale of the disruption facing importers using the port of Shanghai in China, a major gateway for goods shipped to Iran. Transit time used to be 26 days, but now stretches to 102 or even 120 days, and customers are reconsidering importing altogether. The main problem, in her account, is that supply routes are gradually being cut off.
For Washington and its partners, the networks are the enforcement frontier: every informal channel is a potential leak in the sanctions regime, and fresh sanctions remain a live instrument of pressure on Tehran. For the wider region, the flows run through Gulf financial centres, regional traders and Chinese suppliers, so disruption in one node ripples across several economies at once.
Cryptocurrency offered another route, enabling users to transfer wealth without relying on conventional banks. But even these digital assets have not provided a fully reliable escape from sanctions. Earlier this year, the Treasury Department's Office of Foreign Assets Control sanctioned several major Iranian cryptocurrency exchanges, including Nobitex, Wallex, Bitpin and Ramzinex.
Alireza Yaghoubi, chairman of the board of Iran's FinTech Association, has warned that crypto transactions are traceable, and that sanctions have been imposed on multiple Iranian wallets, whether they belonged to individuals, the Central Bank or other entities. The possibility of sanctions, combined with periodic internet disruptions, makes cryptocurrency an uncertain option rather than a safe haven.
The pattern across all four channels is the same, and it is the core of the story. Each workaround functions until it is mapped, designated, disrupted or priced out of reach, and each replacement costs more than the last. The system does not collapse. It degrades. Regulation is closing in on crypto worldwide, which means the digital escape route is narrowing at the same time as the informal ones.
The direct costs function as a tax on every cross-border payment: fees, spreads, delays and losses to fraud, paid by importers, students abroad, patients seeking treatment and families supporting relatives. Over time, that tax pushes activity toward larger, better-connected intermediaries and away from small traders who cannot absorb a lost transfer. The market concentrates in the hands of those with the deepest networks.
The trust deficit deepens the divide. Private deals without documentation reward reputation and connections, which entrenches established networks and shuts out newcomers. If Gulf routes stay disrupted and the naval blockade persists, importers will keep rerouting through longer and costlier paths, and some goods will simply stop arriving. The blockade has already set tankers ablaze in the Strait of Hormuz, a reminder that the shipping lane itself is now part of the pressure.
The rial's fall compounds everything. Even if the payment channels reopened tomorrow, purchasing power has been hollowed out, so the same transfer buys far less than it did a year ago. The workaround economy keeps money moving, but it cannot restore what depreciation has taken away.
In the short term, little points toward relief. With the prospect of another escalation looming over Iran and uncertainty clouding the country's economic outlook, the question for many Iranians is not simply how to move money across borders. It is how long they can keep navigating an increasingly restrictive financial system, and what it will cost them to do so.
Three things are worth watching: whether OFAC designates more exchanges or wallets, whether internet disruptions deepen, and whether the Gulf networks recover or stay disrupted. Longer term, the decisive variable is diplomatic. Any de-escalation or sanctions relief would reopen formal channels faster than any workaround could match. Further escalation would close more of them. For now, the workaround economy is the economy for cross-border payments, and its costs keep rising.
Western capitals read these channels primarily as a sanctions-enforcement problem: informal networks, intermediaries and crypto are routes by which pressure leaks away. The designations of major Iranian crypto exchanges earlier this year fit that reading, with enforcement aimed at closing doors one by one. The same enforcement logic runs through the wider financial system, where a major US bank has just been hit with more than $1.21 billion in penalties over money-laundering and sanctions failures. At the same time, Western reporting stresses the civilian cost: ordinary people caught between restrictions and a collapsing currency.
Read from the East, the story is evidence that financial pressure reshapes trade geography rather than stopping it. Chinese suppliers, Gulf intermediaries and regional ports absorb the flows that Western banking will no longer carry, and the Shanghai transit times show the cost of that rerouting. Beijing and Moscow have long argued that sweeping sanctions push targeted economies into parallel systems. Iran's informal networks are a working example: the money still moves, but through longer, costlier and less transparent paths.
From the Global South, the story is familiar. Millions of people in sanctioned or dollar-scarce economies live in the gap between formal finance and daily need. Informal value-transfer systems, of the kind known as hawala and its cousins, predate the sanctions by centuries and run on trust across diaspora communities. The Iranian case shows both their resilience and their limits: they keep trade alive when banks will not, but at high cost, with fraud and losses falling on those least able to absorb them.
They use four main routes. Currency exchangers match people who need rials inside Iran with people who need foreign currency abroad. Intermediary firms take local currency and pay foreign suppliers from funds held overseas. Private deals between individuals rest on trust rather than contracts. Cryptocurrency bypasses banks entirely. Each route adds fees, delays and risk, and none matches the security of normal banking.
Crypto transactions are traceable, which leaves users exposed to enforcement. Earlier this year, the US Treasury sanctioned several major Iranian exchanges, including Nobitex, Wallex, Bitpin and Ramzinex, and wallets belonging to individuals, the Central Bank and other entities have also been sanctioned. Periodic internet disruptions add a further layer of uncertainty, making crypto an unreliable option rather than a safe haven.
Against the US dollar, the rial has lost more than 10 percent of its value over the past month, more than 55 percent over the past year and almost 90 percent over the past five years. That sustained depreciation has sharply eroded purchasing power, so even when Iranians find a way to pay abroad, what they can afford keeps shrinking. Importers feel the squeeze first, and consumers feel it next.
Importers face a double bind. Payment channels are slow, costly and unreliable, while war disruption and the US naval blockade have complicated transport and lengthened delivery times. Transit from Shanghai, a major gateway for goods shipped to Iran, has stretched from 26 days to 102 or even 120 days. Customers reconsider importing, and supply routes are gradually being cut off.
