Cuban Banks Stop Accepting Dollar Cash Deposits From Today

Cuban banks will no longer accept dollar cash deposits as of Monday, a move the Cuban government justified in response to the US embargo., which makes it difficult for the island to use this currency in the international banking system.

The decision, which caused a stir among Cubans, enters into force in the midst of economic crisis in the Caribbean country, with serious commodity shortage problems and where the local currency has suffered a severe devaluation in recent months.

The announcement, made on June 10, In the days that followed, this caused large lines of people in banks to deposit dollars.

Banks stayed open all weekend, including yesterday Sunday.

A note from the Cuban news agency pointed out today that the US embargo “imposes obstacles on the national banking system for cash deposits of dollars collected in the country” and recalled that the decision is temporary and “n ‘does not affect transactions carried out by bank transfers “. or cash deposits of other freely convertible currencies accepted in Cuba ”.

Until the Banco Central de Cuba announced the move, the value of the dollar on the black market increased uncontrollably to exceed 70 Cuban pesos (CUP), almost triple the official price of 1 to 24. To date, its value in informal operations has fallen to around 52.

Economists familiar with the Cuban economy are convinced that the dollar will continue to circulate in the informal market.

However, they consider that the euro will increase in value against the Cuban peso and may become the reference currency in unofficial transactions, with an informal exchange at that time of about 85 Cuban pesos to one euro compared to the official rate of 28.5.

Cuba applied earlier this year a process of monetary and exchange unification which meant the exit from circulation of the convertible peso (CUC) – parity with the dollar – and which left the Cuban peso (CUP) as the country’s only official currency, with a single official conversion rate of 24 pesos to the dollar.

Absent since 2004, the dollar returned to the Cuban economy in 2019, when the sale of household appliances and auto parts was announced in MLC (freely convertible currency), to be extended the following year to a large part of food and basic products marketed in the state store network .

It skyrocketed the dollar and other black market denominations, as many Cubans are forced to acquire foreign currency in order to purchase their food, toiletries, and other items that are generally impossible to acquire with Cuban pesos.

(With information from AFP)

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