Regulation on currency exchange tightened to disallow participation of foreigners

A regulation tightening the rules on exchanging foreign currency in the Maldives which bans participation of foreigners in the business was publicized on Tuesday night.

Two types of licenses are issued under the ‘Regulation Governing Money Exchange Business’; Tier 1 money exchanging license and Tier 2 money exchanging license.

Tier 1 money exchanging license: Buying and selling foreign currency

Tier 2 money exchanging license: Selling foreign currency

Tier 1 license will be issued for companies incepted for the purpose of buying and selling foreign currency. The owner of such a company must be Maldivian. The license is issued for a period of five years and the business must be conducted a dedicated establishment for it.

As per regulation, a fee of MVR 20,000 must be paid when applying for the Tier 1 license while a fee of MVR 10,000 needs to be paid when applying to renew the license.

Tier 2 license is issued for companies that are licensed to operate tourist resorts under the Tourism Act.

The license will be issued for the length of the license to operate the tourist resort and they must conduct the foreign currency exchange in collaboration with a bank or a Tier 1 license holder.

As per regulation, a fee of USD 1,300 must be paid when applying for the Tier 2 license while a fee of USD 650 needs to be paid when applying to renew the license.