Assetless Cubans to access small bank loans

Cuba's small business owners will be eligible for bank loans without the need to present financial guarantees or guarantors, the People's Savings Bank (BPA) of Cuba announced Wednesday.

BPA director Greicher La Nuez said self-employed Cubans, meaning those who work for themselves, can now apply for loans of up to 10,000 Cuban pesos (400 U.S. dollars), and expect an answer within three days.

In lieu of financial guarantees, the bank has set up a savings mechanism so Cuban entrepreneurs don't have to back up their loan requests with assets or a guarantor.

Many people had neither, said La Nuez, which limited the number of loans the bank could grant, and stifled the growth of Cuba's fledgling private sector.

"That's where we got the idea to make a savings account serve as the financial guarantee," said La Nuez. "For example, if the loan comes to 200 pesos a month, 50 pesos goes into a savings account."

Today, more than 504,000 Cubans are self employed in more than 200 different fields, mainly in the food service sector, including running small restaurants.

These types of small businesses are being encouraged by the government as it works to cut down on the number of Cubans who work in the public sector.

Recently banks also launched online private banking, a service that was previously only available to companies. Endit