Cuban Government Shuts Down 58 Businesses for Non-Compliance with Electronic Payment Mandates

An inspection by the Cuban Ministry of Domestic Trade (MINCIN) during the first week of September resulted in the closure of 58 businesses for failing to comply with regulations on the use of electronic channels for the payment of goods and services.

Inalvis Smith Lubén, Deputy Minister of MINCIN, informed Granma that the inspection led to the closure of 58 establishments, 17 revocations of Commercial Authorization, and 384 fines totaling 1,044,515 pesos. Smith Lubén noted that 71% of the actions targeted self-employed workers (52%) and establishments within the locally-subordinated commerce system (19%). In total, 506 violations were recorded, with 459 measures implemented.

The inspection, conducted between September 2 and 6, covered 1,767 establishments (695 state-run and 1,072 private) to ensure compliance with resolutions 93 and 111 issued by the Cuban Central Bank (BCC). Additionally, 602 intervention actions were carried out in key commercial areas and agricultural markets, where authorities emphasized the use of digital payment platforms to further the banking process aimed at "correcting distortions and revitalizing the economy."

Impact of Resolution 93

Nearly a year after the publication of Resolution 93, Smith Lubén reminded that its provisions apply to "state-owned companies, budgeted units, all forms of foreign investment, non-agricultural cooperatives, agricultural cooperatives, micro, small, and medium-sized enterprises (Mipymes), self-employed workers, independent agricultural producers, local development projects, and non-profit associative forms engaged in commerce."

In April, the Cuban government shut down 476 businesses for not allowing the use of electronic payment channels. Despite the high number, MINCIN head Betsy Díaz Velázquez stated that the number of closed establishments was still "insufficient," as some provinces exhibited low levels of action against violators.

Díaz Velázquez also reported that "non-state entities" had increasingly imposed a surcharge of 10 to 15% on customers using electronic payment channels and had conducted payments to personal accounts rather than the business accounts where the transactions took place. Additionally, 380 licenses were revoked, and fines were imposed, though Díaz Velázquez deemed the fines inadequate. "The fines will be substantial, and closures will also be strictly enforced. There must be rigor," she warned.

In March, authorities closed 45 establishments that did not comply with the directives of Resolution 93, which was approved last November and mandates that all businesses in the country provide consumers with the necessary means for electronic payment.

Shortly after the banking process was implemented, many private business owners rejected the obligation to conduct transactions via electronic channels to maintain the necessary cash flow for other operations. Joaquín Alonso Vázquez, Minister of Economy and Planning (and BCC president when the banking process was approved), explained in April that the "new economic actors" resisted the measure to bank transactions.

During the BCC's 2023 annual review meeting in April, Prime Minister Manuel Marrero Cruz acknowledged the failure of the banking process initiated in August 2023, as well as the ineffectiveness of the official exchange rate established by the regime as part of the "economic and monetary reorganization."