A small regional bank with a big idea about banking in Cuba just issued the first US credit card that functions in Cuba.
Stonegate Bank made headlines last year when it become the first US bank to establish a correspondent banking relationship in Cuba since Washington and Havana normalized relations.
While it has been technically possible to process credit cards in Cuba, US rules have stymied banks in the US from offering transaction processing because of the complexity of US rules for Americans traveling to Cuba. Banks fear being liable for transactions made by Americans who may be traveling to Cuba in violation of U.S. rules that specify twelve authorized categories of travel. Vacation is not an authorized category of travel for U.S. citizens.
Stonegate’s decision to offer debits cards means it is comfortable relying on the travelers’ own self-selection of an approved category of travel. Mastercard will be processing transactions for Stonegate’s debit card.
Stonegate Bank won media attention last year for being the first US bank since the 1960 embargo to conclude a correspondent relationship with Cuba’s Banco Internacional de Comercio S.A. (BISCA). Stonegate also took over domestic banking functions for the Cuban embassy after M&T Bank decided to exit the relationship. It is the correspondent relationship that will allow Stonegate Bank to settle debit card transactions with Cuban entities.
“In the past, everyone’s had to use cash, which is difficult. … It’s dangerous. It doesn’t really make a lot of sense,” Stonegate CEO David Seleski said Tuesday in Havana. “By having a credit card now, people will be able to use corporate travel down here, just like any other country.”
The card will be a limited-edition MasterCard. Stonegate will issue only 1,000 cards initially. Each card will feature artwork by celebrated Cuban painter Michel Mirabal.
The Cuban government will waive the usual 10 percent penalty on dollar exchanges for those using the Stonegate cards.
Seleski said he hopes more U.S. banks will issue cards that can be used in Cuba to ease the burden on the new wave of travelers expected to visit the island in the future.
Why use credit card from Stonegate Bank?
- First bank to issue MasterCard credit cards for use in Cuba.
- Limited edition commemorative Cuban artwork card offered to World and World Elite cardholders.
- Introductory offer of 0% interest for first twelve months for World and World Elite cardholders.
- Generous benefits and added insurance coverage for travel accidents and baggage delay.
- Your credit cards will be issued with EMV chip technology to help prevent identity theft and fraud, and will require a PIN number at point of sale locations, much like a debit card. You may also register to use MasterCard SecureCode™ for your online purchases with participating merchants, which will prompt for a private code at checkout for peace of mind shopping.
- Foreign currency exchange fees waived for all World Elite cardholders (and if you’re a frequent traveler to Europe, you’ll already be prepared with your PIN number).
- Connectivity with the latest versions of Quicken® and QuickBooks® using Web Connect.
- Mobile payments – coming soon.
