Cuban cash shortage linked to lack of functional foreign‑exchange market

Cuban authorities say the scarcity of cash in the national currency is caused by the absence of an operational foreign‑exchange market. Daysel García Bello, director of Territorial Development for the Sancti Spíritus government, explained that without a formal market, businesses turn to informal channels, leading to missed bank deposits and a shortfall of cash.

Bank officials reported that most micro‑enterprises and self‑employed workers do not make the required daily cash deposits. At one branch of Bandec, 24 of 32 small firms and only 338 of 2,792 independent workers had deposited any cash in the first four months. This limits the bank’s ability to meet public demand. Inspectors are few, and many accounts remain inactive.

The officials identified two main reasons for the cash hoarding: tax evasion and the purchase of US dollars on the illegal market. The situation highlights a broader crisis in cash availability and the challenges of enforcing deposit regulations in Cuba.