MasterCard is coming to Cuba this March

Traveling to Cuba from the U.S. has always meant flying into the island with a wad full of cash, as the island’s dual currency system — run mostly on the Cuban Convertible Dollar (CUC) — and the US embargo has made modern-day banking a mere luxury for visitors. SEE ALSO: Cuba becomes the land of the $250,000 family sedan However, part of President Barack Obama’s plan to reestablish relations with the Communist island involves the goal to allow banking between both countries, meaning American banks could potentially set up shop and operate in Cuba. The first sign of the integration with American banks might be the announcement by credit card giant MasterCard that it plans to remove the block on transactions made with its U.S.-issued cards in Cuba. Mastercard coming to Cuba on March 1st The news was first reported by Reuters on Friday, and it could be the first of many similar announcements made that could bring relief to both family members visiting their relatives on the island, as well as tourists visiting Cuba for business or pleasure. The change takes effect on March 1st. “MasterCard said on Friday that it was removing the block following guidance from the U.S. Department of Treasury’s Office of Foreign Assets Control,” Reuters reported. Even though the Cuban Peso has been the long-standing currency of the island, as of recent years the CUC is typically the currency that visitors get to use.  It’s value is approximately equivalent to that of the U.S. Dollar, which is why it’s almost always unattainable for the island’s impoverished population, who gets paid in Cuban Pesos (CUP’s) — currently a U.S. Dollar trades for 26 Pesos (CUPs). At best it’s a dual currency system that is confusing for most users, especially if you add a heavy surcharge taxes imposed by the Cuban government to be paid whenever dollars are exchanged for CUCs, in addition to the exchange rate paid. The implementation of a U.S. credit card such as MasterCard may help simplify the process of buying items and services on the island, even though it’s not clear yet if any of the charges currently associated with exchanging dollars will go away. SEE ALSO: US and Cuba inch closer to opening embassies American Express said it would be reviewing OFAC’s recommendation, but didn’t immediately say if it would start operations in the island. Visa hasn’t made an official announcement on the matter.The post MasterCard is coming to Cuba this March appeared first on Voxxi.

A Cuban displays pesos that were exchanged from U.S. dollars October 26, 2004 in Havana, Cuba. The Cuban government announced a ban on the use of U.S. dollars in response to increased U.S. sanctions. Beginning November 8 banks will begin charging a 10 percent commission on any U.S. dollar currency exchange. (Photo by Jorge Rey/Getty Images)

Traveling to Cuba from the U.S. has always meant flying into the island with a wad full of cash, as the island’s dual currency system — run mostly on the Cuban Convertible Dollar (CUC) — and the US embargo has made modern-day banking a mere luxury for visitors.

SEE ALSO: Cuba becomes the land of the $250,000 family sedan

However, part of President Barack Obama’s plan to reestablish relations with the Communist island involves the goal to allow banking between both countries, meaning American banks could potentially set up shop and operate in Cuba. The first sign of the integration with American banks might be the announcement by credit card giant MasterCard that it plans to remove the block on transactions made with its U.S.-issued cards in Cuba.

Mastercard coming to Cuba on March 1st

The news was first reported by Reuters on Friday, and it could be the first of many similar announcements made that could bring relief to both family members visiting their relatives on the island, as well as tourists visiting Cuba for business or pleasure. The change takes effect on March 1st.

“MasterCard said on Friday that it was removing the block following guidance from the U.S. Department of Treasury’s Office of Foreign Assets Control,” Reuters reported.

MasterCard comes to Cuba.
Master Card. (Shutterstock)

Even though the Cuban Peso has been the long-standing currency of the island, as of recent years the CUC is typically the currency that visitors get to use.  It’s value is approximately equivalent to that of the U.S. Dollar, which is why it’s almost always unattainable for the island’s impoverished population, who gets paid in Cuban Pesos (CUP’s) — currently a U.S. Dollar trades for 26 Pesos (CUPs).

At best it’s a dual currency system that is confusing for most users, especially if you add a heavy surcharge taxes imposed by the Cuban government to be paid whenever dollars are exchanged for CUCs, in addition to the exchange rate paid.

The implementation of a U.S. credit card such as MasterCard may help simplify the process of buying items and services on the island, even though it’s not clear yet if any of the charges currently associated with exchanging dollars will go away.

SEE ALSO: US and Cuba inch closer to opening embassies

American Express said it would be reviewing OFAC’s recommendation, but didn’t immediately say if it would start operations in the island. Visa hasn’t made an official announcement on the matter.

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The post MasterCard is coming to Cuba this March appeared first on Voxxi.