New Cuban law OKs collateral such as gems, cars, art for budding lending system

HAVANA – Cubans can now use personal property such as real estate, jewelry, cars and works of art as collateral for loan applications.

Before, state-run banks required liquid collateral such as solvent co-signers and bank deposits.

The new law is part of President Raul Castro's economic reform plan. It is an attempt to give the growing ranks of private business operators, independent workers and farmers a leg up.

So far, Cuba has a comparatively low ceiling on how much people can borrow.

The lending rules took effect Thursday with their publication in the government's Official Gazette.

They list items including precious stones, paintings, sculptures, vacation homes and agricultural goods from livestock to farm equipment as acceptable collateral.