The Cuban government has ramped up its promotion of the Classic prepaid card, a financial product in U.S. dollars (USD) that facilitates the purchase of goods and services within state-run stores and service stations across the country. Yet, rather than offering an equitable economic solution, this initiative exacerbates economic disparities and increases the population's reliance on access to foreign currency, primarily benefiting the business conglomerate GAESA, which is controlled by the Cuban regime.
GAESA's Currency Collection Strategy
As part of the government's strategies leading up to 2025, capturing foreign currency is a top priority. The Classic card, managed by Fincimex and Corporación CIMEX—both under GAESA's control—provides discounts at state chains such as CIMEX, Tiendas Caribe, and Trimagen, as well as on fuel purchases at service stations. However, access to this card is limited to individuals possessing USD or MLC, leaving out the majority of Cubans who earn in Cuban pesos (CUP).
Amidst the ongoing economic crisis, the state has reduced the availability of goods in stores operating with CUP, increasingly shifting essential items to the foreign currency commercial circuit. This model promotes the exclusion of those dependent on state wages, normalizing an unsustainable monetary situation where the national currency depreciates and loses its function as a means of payment.
Intensive Promotion and Social Inequality
The drive for the Classic card has been accompanied by an aggressive propaganda campaign across social media and state-run media outlets. Posts from Tiendas Caribe and Fincimex highlight supposed benefits like 10% discounts in the Gaviota tourism chain, another GAESA stronghold, and 5% to 6% discounts in various state stores. However, these “benefits” are only accessible to those who can obtain dollars, perpetuating a segmented economy that excludes the majority from the consumer loop.
The card only allows recharges in USD, excluding other convertible currencies like the euro or Canadian dollar. This forces those who rely on remittances to first convert their income to dollars, losing part of its value in the process, while the state monopolizes the flow of foreign currency within the country.
Partial Dollarization and Dollar-Only Stores
The expansion of the Classic card and the proliferation of dollar-only stores strengthen the Cuban regime's policy of partial dollarization, paradoxically aimed at "dedollarizing the economy." Recently, the government has taken a further step in this direction by opening these dollar-exclusive stores, justifying it as a measure to capture foreign currency and regulate the informal market. However, this decision only deepens inequality and pushes a large segment of the population into economic marginalization.
These new dollar-only stores, along with the Classic card and other MLC financial mechanisms, widen the gap between Cubans with access to foreign currency and those reliant solely on CUP. This commercial model results in even greater societal segmentation, where access to basic necessities depends on the ability to acquire foreign currency in a parallel market with high exchange rates.
Impact on the Population and Economic Future
The use of the Classic card highlights the government's shift towards a dual economy where most of the population is disadvantaged. As GAESA expands its control over the commercial and financial sectors, citizens find themselves trapped in an unequal dynamic where the national currency loses its value, and development opportunities are limited.
Concerns have been raised by academics and social groups about the consequences of this model. Creating a commercial system where only those with access to dollars can participate widens social gaps and weakens the country's economic cohesion. Instead of implementing structural reforms to strengthen the economy, the regime chooses measures that perpetuate dependency on remittances and access to foreign currency.
Understanding Cuba's Economic Challenges
What is the Classic prepaid card in Cuba?
The Classic prepaid card is a financial product in U.S. dollars that allows purchases in state-run stores and service stations in Cuba.
How does the Classic card affect economic inequality in Cuba?
The card exacerbates economic inequality by limiting access to those with foreign currency, excluding most Cubans who earn in local currency.
Why is the Cuban government promoting dollar-only stores?
The government claims it's a measure to capture foreign currency and regulate the informal market, though it deepens economic inequality.