Bank of Maldives (BML) admitted last week that it has implemented internal controls on the sale of US dollars for business Telegraphic Transfers (TTs) to prevent some businesses from exploiting the dollar support system.
The bank's management disclosed this during a press conference in response to growing complaints from the business community regarding difficulties in securing dollar support for certain TTs.
Providing details on the matter, BML’s Director of Retail and SME Banking, Moosa Nimal, stated that the bank had established specific tiers for dollar sales designed to prioritize assistance for small businesses.
Under BML’s established tiers, TTs below USD 2,500 receive 50 percent dollar support, while those between USD 2,500 and USD 5,000 receive 30 percent. For TTs exceeding USD 5,000, the support is set at 15 percent, with a maximum cap of USD 10,000 per transaction.
Nimal explained that while these measures were intended to facilitate small businesses, the bank observed some entities exploiting the system by splitting single invoices into multiple smaller transactions to maximize their dollar support.
"This practice forced us to sell dollars for large-scale transactions at the same rates intended for small businesses. So, we introduced certain changes to address this issue," Nimal said.
He noted that the recent reports of businesses being unable to access dollar support were a result of these adjustments. He emphasized that the changes aim to ensure the bank provides support proportionate to the scale of each business.
With the new controls in place, Nimal stated that dollar support is now provided on a "case-by-case" basis for every TT, taking into account the volume of dollars previously sold to that specific business.
"We now review how much has been sold to each business within the current month. We assess whether the amount already disbursed is appropriate for that business. The complaints likely stem from these adjustments made over the last two days," he added.
BML has suspended dollar support for imports, say businesses
The Bank of Maldives has reportedly suspended US dollar support for import-related transfers until the end of the month. This move forces businesses to source currency from the black market at high rates, leading to a sharp rise in local prices. BML has not officially commented on the suspension or the resulting challenges for traders.
Despite BML establishing these new protocols—which effectively restrict dollar sales to certain businesses based on their prior allocations—the bank had initially denied such reports when they first surfaced in the media. Adhadhu had reported that some businesses were informed they would not receive further dollar support for the remainder of the month.
In a message sent to media outlets following the Adhadhu article, BML dismissed those reports as "false and inaccurate," claiming at the time that no TTs had been denied dollar support.
However, statements made by Nimal and BML’s CEO and Managing Director, Mohamed Shareef, during last week's press conference confirm that the bank has decided to stop selling dollars to businesses that have reached their allocated limits.
In addition to volume-based restrictions, BML has also decided to exclude certain types of businesses from the dollar support program altogether. The bank specified that this includes businesses involved in forex trading and gift card services.
The foreign currency provided by BML as dollar support for businesses is facilitated through the Maldives Monetary Authority (MMA).
