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Cuba Implements Electronic Transactions for Salary Payments and Financial Exchanges

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Cuba Implements Electronic Transactions for Salary Payments and Financial Exchanges

Title: Cuba Implements Electronic Transactions for Salary Payments and Financial Exchanges

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The authorities of the state Central Bank of Cuba (BCC) have announced a major shift in the island’s economy, as all salary payments and financial exchanges exceeding 5,000 Cuban pesos (CUP) will now be conducted through electronic transactions instead of in cash. This measure, effective August 3rd, aims to streamline banking operations and reduce the reliance on scarce cash, which has been a source of frustration for many Cubans.

According to the BCC, the new policy seeks to promote the banking of collection and payment transactions between all actors in the economy, as well as the general public. Alberto Quiñones Betancourt, the vice president of the BCC, stated that cash operations up to 5,000CUP will still be allowed for smaller payment transactions, but any payments exceeding this limit must be made through electronic means.

The BCC’s Directorate of Operations and Payment System emphasized that territories lacking the necessary conditions for electronic transactions will have a six-month period to adapt. During this time, cash transactions will continue for amounts exceeding 5,000 pesos. However, all businesses, including those owned by the state, are now required to have electronic means of payment.

EnZona and Transfermóvil, the two widely criticized electronic payment platforms, will be the primary options for businesses to adopt. The BCC notes that this does not prohibit the use of cash for smaller payments.

In acknowledging the concerns surrounding the reliability of Cuban banks, Quiñones Betancourt stressed the importance of building trust with businessmen and the public. He urged the banking system to be seen as a reliable ally.

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The BCC officials also recognized the challenges faced by ATMs due to the shortage of parts and spare parts, which they attribute to the effects of the blockade. Consequently, ATMs will now be primarily dedicated to operations with cards of individuals receiving pensions, salaries, and other personal assets. Deposits into savings accounts will also be facilitated.

No specific mention was made regarding the existing restrictions on Transfermóvil, which limit daily operations and impose a monthly cap on bank transfers and withdrawals.

While electronic payment gateways gained prominence during the Covid-19 pandemic and the introduction of MLC cards for dollar stores, most transactions in the country still occur within the informal economy. Experts suggest that the new measure seeks to assert greater control over monetary exchanges by encouraging individuals to deposit their money in state financial institutions, despite prevailing public apprehension.

In the coming months, it remains to be seen how this shift towards electronic transactions will shape the Cuban economy, with the key focus being on maintaining trust in the banking system and adapting to the changing financial landscape.

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