Hezbollah has begun restructuring parts of its overseas financial networks after suffering major economic setbacks during the war and facing a decline in some of the traditional funding streams coming from Iran, according to a Lebanese financial source familiar with the group’s activities.

The source told Erem News that the Iran-backed group has spent recent weeks reorganizing segments of its financial infrastructure in an effort to prevent mounting economic pressure from turning into a broader crisis within its support base.

“Hezbollah did not emerge from the war financially intact as it is trying to portray,” the source said, pointing to the heavy destruction in southern Lebanon, Beirut’s southern suburbs and the Bekaa Valley, as well as the massive displacement and compensation costs generated by the conflict.

According to the source, the scale of losses forced the group to search for alternative funding mechanisms after parts of its traditional financial system became increasingly vulnerable to international monitoring and targeting.

In recent months, tens of millions of dollars reportedly entered Lebanon through informal hawala and cash-transfer networks, with some monthly flows estimated at more than $70 million. The source, however, stressed that the money was largely being used to offset accumulated losses and sustain existing obligations rather than build new financial reserves.

The conflict accelerated Hezbollah’s shift toward what the source described as an “evasion economy,” relying heavily on cash transactions, intermediaries and informal transfer systems operating outside the regulated banking sector.

The hawala system, in particular, has become increasingly important because it allows money to move through trusted brokers and personal networks without passing through formal financial institutions subject to strict international oversight.

The source added that the war also pushed Hezbollah to rely more extensively on cash liquidity, gold and the parallel economy as conventional transfer channels linked to Iran or commercial front companies became riskier and more exposed.

At the center of the financial strain is Al-Qard Al-Hasan Association, the financial institution linked to Hezbollah that was targeted during the war by Israeli strikes on several of its branches and facilities.

According to the source, the attacks disrupted a key part of the liquidity cycle within Hezbollah’s support environment, particularly because thousands of families depended on the institution for loans, gold storage and access to cash.

In response, Hezbollah reportedly sought to reactivate parts of its financial network through alternative methods, reducing reliance on fixed branches while expanding the role of intermediaries and direct cash transportation. The group also increasingly used social and religious networks to distribute aid and compensation outside the framework of formal institutions.

The source said Hezbollah understands that its standing within its own constituency is closely tied to its ability to continue paying salaries and compensation, making the preservation of minimum financial flows “an existential issue.”

To compensate for declining traditional revenues, Hezbollah also revived parts of its older financial networks within the Lebanese diaspora, particularly in West Africa and Latin America, the source said.

Lebanese businessmen and commercial networks linked to the group’s support base reportedly helped facilitate liquidity and transfers through indirect channels built on longstanding family and trade ties. Some funds were also said to move through the gold trade, used-car markets and smaller commercial activities that are difficult to fully track.

Still, the source argued that the existence of such networks should not be interpreted as proof of unlimited financial strength.

“These networks reflect a crisis that is forcing Hezbollah to constantly search for alternatives,” the source said, adding that the group is now operating with a “management of depletion” mindset rather than one based on stable financing.

Lebanese political analyst Ali Hamadeh said the war exposed vulnerabilities within Hezbollah’s economic structure, even if the group managed to avoid total financial collapse.

Hamadeh said Hezbollah faced “unprecedented financial depletion” during the conflict, not only because of military operations but also because of the enormous social burden created by displacement, destruction, compensation payments and salaries inside its support base.

He added that sanctions, tighter international oversight and the targeting of Hezbollah-linked financial networks had accelerated the group’s shift toward a cash-based and informal economy.

“Hezbollah today is no longer building an economy of power, but an economy of survival,” Hamadeh said, arguing that the group’s priority has become preventing collapse within its own environment rather than pursuing new financial expansion.