Maldives faces dollar shortage and banking fee controversy

The Maldives is navigating significant financial challenges, including a foreign exchange shortage and recent banking policy controversies. The Bank of Maldives (BML) recently reversed a decision to implement a 10% fee on overseas ATM withdrawals following public backlash. The fee had specifically impacted Maldivian students living abroad who rely on monthly USD 1,200 transaction limits. Opposition politician Fayyaz Ismail criticized the administration for the lack of foresight and demanded immediate refunds for those already charged.

Simultaneously, the country is facing a US dollar shortage that affects businesses, banks, and migrant workers. This shortage is particularly impactful for the large population of Bangladeshi workers in the Maldives. According to the Maldives Monetary Authority, Bangladesh receives approximately 72 percent of the total value of outward remittances from the Maldives, totaling over US$112 million. While the official exchange rate remains stable, a gap has emerged between official and parallel foreign exchange markets, impacting the income of workers attempting to convert their earnings.