The Maldives Monetary Authority (MMA) will increase its foreign exchange intervention this year with a higher supply of US dollars to commercial banks, Deputy Governor Ahmed Imad revealed during a recent Parliamentary Committee on Public Accounts meeting.
Responding to concerns raised by the Member of Parliament for Maradhoo, Ibrahim Shareef, who claimed that the Bank of Maldives (BML) had reduced its foreign currency support to local businesses from 25 percent to 10 percent, Imad confirmed that the central bank had received notifications from some commercial banks reducing their foreign currency support for private businesses. Despite these changes, the central bank has maintained its foreign exchange intervention and the issuance of US dollars to commercial banks, he clarified.
Imad stated, “No alterations were made [to MMA’s policies]. It appears to be a revision to their [BML’s] business operation policies. The quantity of foreign currency issued to commercial banks will exceed the 2023 levels in 2024.”
Earlier this year, BML addressed speculation about the bank potentially limiting or ceasing US dollar support for businesses. Local traders speculated that due to a limited supply of dollars, BML might soon be unable to provide dollars for telegraphic transfers (TTs) issued by businesses for international purchases.
Despite these challenges, BML assured that there would be no fluctuation in the availability of funds within any USD account or changes to any current standards of operation. The bank also confirmed there will be no difficulty in transfers with adequate USD funds in the account.