The Bank of Maldives (BML), with a view to address the decline in the availability of US dollars (USD) in the Maldives’ exchange market, has revised its monthly USD sale limit for students studying abroad.

The bank, instead of offering the blanket US$1,000 previously sold to students undertaking their higher education abroad, revised its limit based on the country of study — the new limits were determined in consultations with the Ministry of of Higher Education, Labour and Skills Development.

The bank has informed students of the change via email. The new limits are;

Country of Study Monthly Exchange/Withdrawal from MVR Account
MalaysiaMYR 1,960 [Approximately US$415]
IndiaUS$440
NepalUS$415
PhilippinesUS$450
RussiaUS$615

With this change, USD sold to most students sees more than a 50 percent reduction.

In the past few years, BML sold US$333 million in excess of amounts received from customers and the Maldives Monetary Authority (MMA).

When it is unsustainable for the bank to keep selling what it cannot afford to buy, it is forced to make decisions to secure its financial position and reduce exposure to risks until the situation becomes more viable, CEO Karl Stumke had said earlier.

In December 2023, the administration announced plans to increase the monthly USD withdrawal amount, through funds in MVR accounts converted to USD, to US$ 1,200 dollars — seen also as a key half-way measure in line with President Mohamed Muizzu’s pledge to abolish dollar limits imposed by banks.

Meanwhile, the USD shortage in the Maldives continues to persist, forcing many to resort to parallel markets, where prices range from MVR 16 to over MVR 18 per USD, despite the official exchange rate of MVR 15.42. Even as economists and observers have called for regulatory changes to address the issue and eliminate the parallel black markets, a comprehensive solution remains elusive, with the MMA also coming under fire for a perceived lack of adequate action in comprehensively addressing the USD issue.