Cuban Banks Start Offering Loans to Promote Private Enterprise

In yet another move against the rigid Communist economic model, banks in Cuba have started providing loans to private entities and individual citizens.

The state newspaper Granma said about 500 banks in Cuba will offer the loans, although it remains unclear what interest rates they will charge. Applicants will find out if their loans are approved within twenty days, the paper indicated.

Reportedly, self-employed Cubans will receive minimum loans of about $125, while farmers will receive at least $40.

In addition, Cubans will also be able to avail themselves of debit cards, checks, and bank transfers – that is, services common to citizens of capitalist nations.

The Havana government has undertaken a series of free market reforms over the past year and a half in an effort to re-energize the island’s moribund economy.

President Raul Castro, brother of former leader Fidel, and his regime has been encouraging more Cubans to become entrepreneurs and form small businesses. Last year, Havana fired tens of thousands of state employees and reduced state subsidies in order to promote more private enterprise. Cubans are also now permitted to buy and sell property and cars.