An official press proposal suggests that the cash shortage currently suffocating many banking operations in Cuba could be resolved by introducing high-denomination coins into circulation.
A comment in the newspaper Victoria, from the Isle of Youth, even mentions the possibility of minting coins of 10,000 pesos or more, which would take up less space, last longer than bills, and be harder to counterfeit.
But this "likely solution" to "the exasperating current situation" of cash shortages in banks, as the media acknowledges, overlooks the root of the problem: a collapsed financial system, lacking trust and liquidity.
Venezuela is cited as an example, a country where coins ranging from 50 to 1,000 bolívares are in circulation, to justify the idea of introducing a larger quantity of bimetallic coins in Cuba.
It also mentions that there are already two national precedents: a five convertible peso (CUC) coin -now only of numismatic value- featuring the image of Ernesto Che Guevara, minted in 1999, and the one currently in circulation with the effigy of Antonio Maceo, issued in 2016.
The reasoning behind the proposal is based on practicality: coins last longer, do not deteriorate like bills, and are less expensive in the long run. Furthermore, it is suggested that those who keep money at home—out of fear or distrust—would be more willing to exchange it if the physical volume of cash were smaller. In other words, if there were coins with a higher face value.
"I propose that the actions of those who violate the treasury and hinder the flow of money by worsening the economic stagnation be legalized? Never. I seek to improve the situation for the vast majority, for the average Cuban… so that, while we await the solution that will resolve the issue, there is more cash available in the banks. And in banknotes that ATMs can dispense," the text emphasizes.
But at no time are the real causes of the cash shortage mentioned: uncontrolled inflation, the collapse of the Cuban peso, widespread distrust in the banking system, and the systematic depletion of ATMs, many of which are also out of order. Even less is said about the lack of productive backing, the galloping process of dollarization or the numerous obstacles to accessing one's own money.
The possible alternative sidesteps the underlying problem and focuses on an aesthetic patch. More currency in circulation does not mean more purchasing power or real liquidity for the average Cuban. What is needed is not to change the form of money, but to tackle the root causes of why there is no available money. And that, for now, is not being minted.
The failed “economic and monetary ordering” implemented by the government in 2021 ultimately delivered a fatal blow to the national currency, skyrocketing its value in the informal market due to the unavailability of dollars in the Currency Exchange Houses (CADECAS), and triggering unprecedented inflation.
The uncontrolled inflation that the population suffers increases the cost of basic necessities while the wages remain stagnant and the purchasing power of Cubans deteriorates, exhausted by queues, blackouts, hunger, and despair.
According to official data published in October 2024, 39% of retirees in Cuba receive the minimum pension of 1,528 CUP per month, which does not even cover a basic diet. In fact, a kilogram of powdered milk can cost up to 1,800 CUP and a liter of oil up to 1,400 CUP.
According to the economist Pavel Vidal, a researcher at Javeriana University in Colombia, the Cuban crisis has triggered the informal economy and especially the informal currency market, “which significantly operates in cash, so you have a government issuing a lot of money without the ability, without the dollars, to print pesos.”
The professor holds the government accountable because “it has also refused to print higher denomination bills, with the highest denomination being 1,000 pesos, which is equivalent to three dollars at the informal market exchange rate.”
On its part, the government's push for banking integration to promote digital payments and reduce cash usage, practically faces technical, economic, and cultural obstacles.
Broken ATMs, long lines, and limited cash availability is the reality that people trying to withdraw their salaries and pensions across Cuba have been facing for months. Additionally, businesses are reporting connectivity issues, nonfunctional QR codes, unjustified surcharges, or simply refusing to accept electronic payments as part of everyday life.
The leader Miguel Díaz-Canel blamed the private sector for the lack of cash in the country's ATMs since the banking process began.
However, for some self-employed workers, digital payment is seen as a hindrance: slow, unreliable, and frustrating for customers. This technological distrust is compounded by the fact that many economic actors, whether state or private, struggle to access their money efficiently, leading them to prefer cash and operate outside of fiscal control, and in this case, the blame falls squarely on the government and its banking system.
Other structural factors also conspire against the success of banking: there are areas without coverage where it is not possible to use digital platforms, and in those cases, cash remains the only viable option.
Frequently Asked Questions about the Economic Crisis and the Proposal for New Currencies in Cuba
What is the proposal for introducing high-denomination coins in Cuba?
The proposal suggests the introduction of high-denomination coins, such as 10,000 peso pieces, to address the cash shortage in Cuban banks. The reasoning is that these coins would take up less space, last longer than banknotes, and be more difficult to counterfeit, although it does not address the underlying causes of the financial problem in Cuba.
Why is there a cash shortage in Cuba?
The cash shortage in Cuba is due to a combination of uncontrolled inflation, the collapse of the Cuban peso, distrust in the banking system, and the emptying of ATMs. These issues are worsened by the lack of productive backing and barriers to accessing one's own money. Additionally, partial dollarization and the economic crisis have further exacerbated the situation.
How does the proposal of high-denomination currency affect the average Cuban?
The proposal to introduce high-denomination coins could not solve the real problem of liquidity and purchasing power deficiency. Although they could facilitate the physical management of cash, they do not address the underlying causes of the economic crisis, such as inflation and lack of confidence in the financial system.
What impact does partial dollarization have on the Cuban economy?
Partial dollarization in Cuba has created an unequal economic model, where only those with access to foreign currency can meet basic needs or participate in strategic sectors. This perpetuates the gap between those who have access to foreign currency and those who survive on Cuban pesos, negatively affecting the purchasing power of the majority of Cubans.
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