Biden Administration to Allow Cuba Private Sector Access to US Banking

A view of Cuban and U.S. flags beside the U.S. Embassy in Havana on Dec. 15, 2020. Alexandre Meneghini/Reuters

The Biden administration announced regulatory changes on May 28 that would allow Cuban private sector entrepreneurs to open bank accounts in the United States and remotely use them while in Cuba.

The U.S. Treasury Department said that it has amended the Cuban Assets Control Regulations to promote internet freedom and boost private sector businesses in the communist-ruled nation.

“With this announcement, the administration is now fully implementing the May 2022 commitments to the Cuban people,” a senior administration official told reporters on May 28.

“We believe that the growth of an independent entrepreneurial private sector in Cuba is fully aligned with our values, is the best hope for generating economic development and employment in Cuba, and the growth of this sector is also consistent with the president’s guidance to implement measures that will benefit the Cuban people while continuing to minimize resources to the Cuban government.”

The regulatory changes would allow Cuban entrepreneurs to use U.S.-based social media sites, video conferencing, e-gaming and e-learning platforms, web maps, and user authentication services.

Cuban entrepreneurs are now able to open bank accounts in the United States and conduct authorized transactions, including through online payment sites, once they return to Cuba—which they were unable to do previously.

The department also authorized U.S. banks to process “U-turn” funds transfers, enabling them to move money for Cuban nationals, provided that neither the sender nor the recipient is subject to U.S. jurisdiction.

“This reinstated authorization is intended to help the Cuban people, including independent private sector entrepreneurs, by facilitating remittances and payments for transactions in the Cuban private sector that are authorized by various provisions of the [Cuban Assets Control Regulations],” the department said in a statement.

Cuba Sanctions Remain

There are more than 11,000 registered private businesses in Cuba that could benefit from the regulatory changes, but their ownership must not involve “prohibited Cuban officials,” according to U.S. officials.

The regulatory changes exclude Cuban government officials, such as national assembly members, Cuban Communist Party members, Cuban military officers, or certain ministry and staff regime propagandists.

“For a Cuban private sector business to qualify under this definition, its ownership cannot include such insiders,” another senior U.S. administration official stated.

“I want to reiterate that our Cuba sanctions remain in place and the regulations continue to maintain restrictions on the Cuban government and its military, intelligence, and security services.”

The United States has designated Cuba as a state sponsor of terrorism—along with North Korea, Iran, and Syria—which could impede financial dealings for the island nation.

Rep. Maria Elvira Salazar (R-Fla.), a Cuban American lawmaker from Miami, has voiced her criticism of the administration’s move on X, formerly known as Twitter.

“As I warned, the Biden Admin is now giving the ‘Cuban private sector’ access to the U.S. financial system,” the Republican lawmaker stated. “This would make a mockery of American law, considering no progress has been made toward freedom on the Island and repression has intensified.”

In May 2022, the Biden administration unveiled a range of new policies on Cuba, signaling the return of a trend under the Obama administration that President Donald Trump had reversed.

President Joe Biden has moved to reinstate the Cuba Family Reunification Parole Program, eliminate a $1,000 remittance cap, resume “educational travel” to Cuba, and boost support for independent Cuban entrepreneurs.

Nathan Worcester contributed to this report.