No Extra Charges on Credit Cards; BML Working on Solution to Daily Budget Limit Constraints

Rumors have recently circulated claiming that the Bank of Maldives (BML) is imposing an additional 10% charge on top of an existing 30% fee for foreign transactions made using MVR cards, resulting in a total charge of 40%. Some have also alleged that a 30% fee is being applied to credit card transactions.

However, following inquiries with the Bank, BML has categorically dismissed these claims as false and baseless. The Bank also stated that it is actively working to resolve the issue of transactions failing when the daily budget limit is reached, with a solution expected by the end of this month.

What Are the Facts?

According to the Bank’s Schedule of Charges:

“All cross-border transactions effected through debit and credit cards shall be subject to a cross-border transaction fee of up to 10% where the transaction is conducted in a currency other than USD, or where the transaction is processed using a card funded in MVR or linked to an MVR account. In the case of transactions with selected merchants, a cross-border transaction fee of up to 30% may apply.”

To clarify these provisions, we sought further information from the Bank.

Since the introduction of its card services, the fee of up to 10% specified in the Schedule of Charges has been applied consistently. This is not a flat 10% fee; rather, the charge varies by card product and can be up to 10%. The policy remains unchanged and reflects a common international banking practice, often referred to as an Optional Issuer Fee (OIF).

Under the current Schedule of Charges, cross-border transactions made using debit or credit cards are subject to a fee of up to 10% when the transaction is conducted in a currency other than USD or when the funding source is an MVR account or MVR-linked credit card. The 30% fee, meanwhile, is a separate charge that applies only to transactions with selected merchants.

The 30% fee was introduced on July 1, 2024, specifically to address the misuse of personal cards for commercial transactions on certain foreign e-commerce platforms. The fee applies to only six designated websites. Importantly, this policy has not changed, and the 30% fee has not been applied to credit card transactions.

Furthermore, the 30% fee is not cumulative with the fee of up to 10%. Only one of these charges applies to a transaction, depending on the merchant and transaction type.

What Is the Purpose of These Fees?

These fees are neither accidental nor hidden. They reflect the costs associated with cross-border payments, currency conversion, and the liquidity management required to provide foreign currency for a high volume of international transactions.

Such costs are a fundamental part of the global payments ecosystem. No bank or card network can facilitate cross-border transactions without incurring operational and financial expenses, which are typically recovered through service fees.

The Bank’s Support for Dollar Liquidity

On November 11, coinciding with the Bank’s anniversary, BML significantly increased the overall foreign transaction limits available to debit card customers.

Under the revised structure, customers can now access up to USD 3,000 per month for medical and travel-related expenses, USD 1,000 for POS transactions, USD 250 for e-commerce purchases, and USD 150 for ATM withdrawals.

For comparison, from September 16, 2020, until July 1, 2025, the combined limit for these activities was capped at just USD 250. The increase therefore represents a substantial enhancement in customer access to foreign currency. Credit card limits have also been increased accordingly.

The Bank continues to support businesses with their foreign currency requirements. During the first five months of this year, BML sold a total of USD 345 million. Of this amount, USD 147 million was allocated to businesses, while USD 198 million was provided for card transactions. Additional allowances remain available for students, travel tickets, hotel expenses, and medical costs.

As of the end of May, BML’s Net Open Position stood at a short position of 6.6%, remaining within the regulatory limits established by the Maldives Monetary Authority (MMA).

To facilitate outward foreign transfers and card transactions, the Bank sold an average of USD 69 million per month during the first five months of the year, representing a 47% increase over last year’s monthly average of USD 47 million.

The Current Challenges

The rapid growth in online transactions using MVR cards has required the Bank to secure significant volumes of foreign currency to settle payments with international merchants through card networks. To manage this demand sustainably, BML implemented a daily budget for certain online transactions.

The frustration experienced by some customers arises when transactions fail after the daily budget has been exhausted. However, transactions conducted using US Dollar cards are not affected by these limits.

Despite these constraints, Bank statistics indicate that it has sold USD 69 million more than it has purchased, demonstrating that it continues to provide more foreign currency liquidity than it receives. The Bank has reiterated that it is working on a solution to address the daily budget limitations and expects to implement it by the end of the month.

Compared with other banks operating in the Maldives, Bank of Maldives offers some of the highest limits and broadest access to foreign transactions through MVR cards. This includes individuals who do not deposit their salaries with the Bank but can still open MVR accounts and obtain debit cards with the same transaction limits as other customers.

It is also important to note that there are currently no transaction limits on US Dollar cards, making them a practical alternative for customers requiring uninterrupted access to foreign currency transactions.