President of Cuba Analyzes the Banking Process in the Country

The president affirmed that this is a necessary process and in which progress is urgent.

The President of Cuba, Miguel Díaz-Canel, analyzed on Thursday the characteristics of the banking process carried out by the country since August 2023, for the contributions it can make to the economic development of the Caribbean island.

Cuba and Panama Are Connected by Opening Charter Flight

During the eighth installment of his podcast From the Presidency, the Cuban president affirmed that it is “a necessary process in the conditions of Cuba at this time and in which it is urgent to move forward”.

In that sense, he specified that this is “one of the most important processes that includes the scenario of digital transformation of Cuban society, which helps to reconform a whole group of elements that are part of the macroeconomic stabilization program”.

The Head of State explained that banking is also related to controls on the levels of cash circulation, while it can affect “in the relation between the money supply in national currency and the money supply in currency and therefore it will have to do with the levels that also reach the exchange rate”.

He also acknowledged that the process is associated with other distortions present in the economy, related to the failure to complete actions to achieve fill payment gateways that support e-commerce and improper management of tax accounts.

Muy críticas las opiniones sobre el proceso de bancarización en el país, a las que respondemos en nuestro pódcast #DesdeLaPresidencia, junto a Juana Lilia Delgado, presidenta del @BancoCentralCub, y el vicepresidente Alberto Quiñones. Síguenos y comenta.

— Miguel Díaz-Canel Bermúdez (@DiazCanelB) June 20, 2024

The text reads,
The opinions on the banking process in the country are very critical, to which we respond in our podcast Desde La Presidencia , together with Juana Lilia Delgado, president of Banco Central Cub
, and vice president Alberto Quiñones. Follow us and comment.

To deepen these issues, the head of state spoke with the Minister President of the Central Bank of Cuba, Juana Lilia Delgado and the vice president of that entity, Alberto Quiñones.

The Minister President explained that banking is not a process exclusive to Cuba, but that in the international arena, governments have developed policies to guarantee the population access to the banking system, as it is a mechanism that promotes savings, supports economic development and reduces the circulation and use of cash.

“From the point of view of our country, it is a real solution apart from the problems we have. In general, in times of economic situations as drastic as the one we are in, the desire to have cash increases in order to be able to face inflation. It becomes a disincentive to keep deposits in banks when every day prices are higher because of situations that exist in the economy,” he said, while noting that existing problems can be solved if conditions are created to deal with them.

For his part, the vice president of the Central Bank of Cuba said that “the practical application of some measures showed that not all the conditions for the implementation of this process were created”, since it requires not only willingness but also investment.

Quiñones Betancourt detailed the actions that were carried out in the banking process in the last ten months, and referred to the differences between transfers and online payments, in addition to referring about violations in the latter in some establishments.

“Today what happens is that you have to assume the means of payment that the establishment requires. No trade can be attributed the right not to accept payment by the way the customer decides, and also do so taking into account everything established,” he said and acknowledged that progress has been made in digital payments, although the use of cash continues.

The vice president of the Cuban banking institution also referred to the sovereignty of the Cuban State to implement the banking process, and the strength that constitute the payment gateways Enzona and Transfermóvil, as well as the technology companies Fincimex and Recsa.

However, he specified that there are economic actors who have assumed the negative attitude of not banking, However, he pointed out that the main efforts of banking should be directed to the purchase of food products and the agricultural market because the main expenses are concentrated there.

“If I am a person who is bankrupt, I use payment channels, it is a right to pay using a payment platform”, he explained, while highlighting the guarantees of using the QR code to proceed with payments and explained the differences between personal and tax bank accounts.

Regarding the situation of ATMs and the issue of cash shortages, the Minister President of the Central Bank of Cuba specified that it is one of the most worrying aspects for the population.

“It’s not that there’s no money in the economy, there’s more money than ever, really. But the flow of that money has been reversed. There is more output from the banking system than what comes back and that alters the whole cash movement cycle and it is hard to then meet the demands. That cash that comes out of the banking system is concentrated in few hands and is one of the aspects by which we say that we must act in order to get that cash back to the banking system by the way that corresponds to it,” explained Delgado.

In this regard, he explained that the banking system is identifying the accounts of economic actors who perform tax evasion and those of natural persons who have large sums of money, so he warned that they exist “people who unwittingly are lending their personal accounts for large amounts of cash and do not realize they are in that act in a possible money laundering operation, which is one of the activities that are criminalized in our criminal code”.

In this regard, Delgado highlighted the existence of a National Banking Group that evaluates the progress of the process and what must be corrected, integrated into provincial and municipal groups, charged with carrying out control in the territories, close to local economic actors.

He also assured that “all possible measures and all variants are being taken to try to minimize the impact, especially on the wage sector and social security pensioners”. Before concluding the space, the Cuban Head of State insisted on the importance of continuing with the process of banking, and ratified the design of a plan with “severe control actions, in the shortest possible time to correct the distortions that exist”.