Cuba Stops Accepting Bank Deposits in Dollars

Cuba said on Thursday it would temporarily suspend bank deposits in U.S. dollars, as tough sanctions restricted the ability to use the greenback, though it still accepts remittances.

This comes before the government presented its annual resolution to end a crippling decades-old US trade embargo on the communist-ruled country at the UN General Assembly.

Analysts have speculated that it was an attempt to control the price of the dollar on the black market, which has more than doubled since Cuba began opening shops selling the U.S. currency.

Bank account holders will have until June 21 to deposit dollars before the new rules takes effect.

"It is difficult for Cuba to find international banking or finance institutions that are willing to receive, transfer or process US currency in cash," the Cuban Central Bank said.

It added that the measure would not affect operations carried out by transfer or deposits in other currencies that are freely convertible and accepted in Cuba.

"This measure would not affect operations carried out by transfer or deposit in other freely convertible currencies acceptable in Cuba."

Over two dozen banks have stopped processing transactions related to Cuba since former President Donald Trump tightened US sanctions.

For many years, Cuba had a 10% tax on dollars, citing how difficult it was for the government to use them because of the U.S. embargo. But it lifted that tax last year as it opened more shops selling in hard cash rather than in the local currency.

Cuba had a 10% tax on dollars, For many years, as it was difficult for the government to use them amid a U.S. embargo, only to lift the tax last year.

Meantime, U.S. President Joe Biden pledged to rescind some Republican measures taken by Trump on Cuba that 'harmed the Cuban people and did nothing to advance democracy and human rights'.