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Nearly 400,000 Cubans take out loans under new policy

Last Updated on Thursday, 13 November 2014, 21:28 by GxMedia

Havana, Nov 13 (EFE).- Cuba’s central bank has extended 3.23 billion pesos ($135 million) in personal loans since lending to individuals began in December 2011, Communist Party daily Granma said Thursday.

The total of borrowers stood at 378,011 as of Sept. 30, Granma said, citing bank Vice President Francisco Mayobre.

President Raul Castro’s administration authorized lending to individuals as part of a package of reforms aimed at “modernizing” Cuba’s socialist economic model.

Most of the borrowers have been people wanting to build or renovate homes and small farmers, Mayobre said, acknowledging that borrowing by would-be entrepreneurs to start businesses has fallen short of expectations.

“Surveys have been done and it has become clear that self-employed workers have a lot of doubts and dissatisfaction about the work of the banks,” he said.

The central bank said it has taken steps to make the process more flexible for borrowers, such as simplifying requirements for documentation and repayment guarantees and introducing variable interest rates and terms.

The bank is struggling to meet demand for services and may open new branches in Havana and provincial capitals, Mayobre said