Western Union resumes some Cuba operations following 2020 halt

Jan 11 (Reuters) - Western Union has resumed services to Cuba in a test phase that will allow for money transfers to the island, its first such transactions since a 2020 halt triggered by Trump administration sanctions.

Remittances have long been a crucial source of income for Cuban families, but the need has become even more acute amid a severe economic crisis resulting from tighter U.S. sanctions, the coronavirus pandemic and an ailing tourism industry that is struggling to recover.

"It is with great pleasure to announce the resumption of our Cuba operations with an initial testing phase of outbound service from the US to customers with Cuban bank accounts," said Gabriella Fitzgerald, President, Western Union North America, in an emailed statement.

The service is currently limited to a select number of U.S. retail locations in the Miami area, she added.

Sanctions enacted during the Trump administration severely limited traditional money transfers, leading to increased reliance on informal money changing services that typically carry cash on flights.

Such transactions often carry hefty fees and involve more risk.

Western Union resumes its services to Cuba amid a tepid but steady rollback of some Trump-era restrictions by the administration of U.S. President Joe Biden.

Trump barred U.S. companies from facilitating money transfers to Cuba through military-aligned companies identified on the U.S. "Cuba Restricted List," a blacklist of Cuban people and entities with which U.S. companies are prohibited from doing business.

The Biden administration said in May that it would instead use "electronic payment processors" for remittances to avoid funds going directly to the Cuban government, and said it had already engaged with Cuba "about establishing a civilian processor."

Western Union did not elaborate in its statement Wednesday on the channels it would use to transfer the money. (Reporting by Brian Ellsworth in Caracas and Dave Sherwood in Havana)