MDP’s chairperson slams President Muizzu’s ‘uninformed decisions’ after USD limit change

Fayyaz Ismail, the chairperson of the main opposition Maldivian Democratic Party (MDP), accused President Dr. Mohamed Muizzu of making uninformed decisions on Sunday, as he expressed concern over the negative impact of the decision by the national bank to suspend foreign transactions on cards liked to MVR accounts.

Bank of Maldives (BML) had allowed up to USD 250 in foreign transactions from its debit and credit cards, allowing a higher allowance of up to USD 750 for Maldivians residing overseas.

But on Sunday morning, the BML implemented changes to its card limit for foreign transactions – suspending allowance for foreign transactions for existing debit cards, as well as new debit and credit cards linked to MVR accounts.

Meanwhile, the monthly limit for foreign transactions on standard and gold credit cards has been lowered to USD 100.

In a post on X, Fayyaz, who served as economic minister during the last MDP administration, said that such a sudden change will have a very negative effect on students and businesses; disrupting payments to websites, software and more.

Fayyaz said he hopes the government is aware of the effect it will have on the private sector.

“Dr. Muizzu promised that he is not worried at all about the economy and later on very strongly stated dollar black market rate will not increase,” said Fayyaz. “Such uninformed decisions by the head of state does have impacts across all sectors.”

BML said that it decided to make the changes because the card usage is threefold higher than foreign currency it is able to purchase – impacting the bank’s ability to provide foreign currency support to its business customers.

BML’s CEO and Managing Director Karl Stumke acknowledged that the changes will have a significant impact on the bank’s customers, but said the bank accepts the changes to be temporary.

“We do expect this to be a temporary change and we will review this from time to time and keep our customers informed of any changes,” he said.

“We have not taken this decision lightly but have been compelled to take action to ensure we can continue to provide the necessary support for essential economic activities.”

BML had previously allowed up to USD 250 in foreign transactions from its debit and credit cards, and up to USD 750 for Maldivians residing overseas.

The bank had imposed the limit of foreign transactions following a shortage in USD amid the economic downturn during the Covid-19 pandemic. The failure to raise the limit in the four years since had sparked criticism against the bank.

President Muizzu, during his 2023 presidential campaign, pledged to lift the limit.

In January, President Muizzu’s administration announced that the limit would be raised from USD 750 to USD 1,200 for Maldivian students overseas. But the February deadline passed without implementing the promised change.

The BML’s decision to change its card limits for foreign transactions comes after the Privatization and Corporatization Board (PCB) sent a letter to the bank’s Deputy CEO Aishath Nooraddin – who had served at the bank for over 42 years – informing her of the decision to dismiss her from the bank’s board.

However, the dismissal of board members requires approval from the bank’s shareholders.

The BML’s board also underwent changes in January. All non-executive members of the board were dismissed, but two of them were later reappointed.