Bank of Maldives launches US dollar investment product offering returns of up to 25%

Bank of Maldives (BML) on Tuesday launched a new US dollar investment offering that lets customers earn returns by investing their dollars, with the bank using the funds to support its commercial operations.

BML said invested US dollars will be used to facilitate the bank's fee-generating commercial activities. In return, investors earn what the bank described as competitive returns, with some pools offering up to 25%.

Daily investment pools, each with different rates of return, are available from Tuesday through the BML Mobile App and Internet Banking. The bank said both digital platforms have been upgraded so customers can complete investments online.

According to BML, customers receive the equivalent value of their investment in Maldivian Rufiyaa (MVR), credited to their account instantly. The profit earned is credited to the customer's MVR account the following day.

Speaking at the launch, BML CEO and Managing Director Mohamed Shareef linked the product to rising demand for US dollars driven by overseas card spending. He said the volume of US dollars sold for debit and credit card transactions relating to overseas purchases and services had increased 3.7-fold over the past five years, reaching an average of USD 39.3 million per month this year.

Shareef said the number of customers using these services had more than doubled in the same period. He said between 250,000 and 300,000 customers now make foreign transactions every month using their MVR cards. He attributed the growth mainly to a rapid increase in cross-border e-commerce by Maldivians.

Shareef said the card business is highly profitable for the bank, but that the bank's ability to facilitate the transactions depends on its US dollar income and the foreign currency it can acquire. He said BML had sold approximately USD 1.6 billion over the past 36 months to meet personal foreign currency and business needs, with nearly 60% of that allocated to card payments.

He said sustaining those volumes of dollar sales was becoming increasingly challenging as demand grew, but that the bank did not want to introduce measures that would restrict a service used by a large segment of its customers.

Explaining the rationale for the new product, Shareef said the bank had created an investment model intended to benefit investors, card users, and the bank. He said that by encouraging customers with US dollar income to invest in the pools, the bank could use the funds to facilitate e-commerce transactions and other fee-generating activities, then distribute the resulting income to investors as returns after deducting operational costs.

BML said the model is designed to secure the foreign currency needed for card payments, e-commerce transactions, and the import of goods. The bank described the result as a sustainable ecosystem delivering value to investors, customers, and the bank.

The launch event included a live demonstration of the investment process through the BML Mobile App and Internet Banking. Shareef also answered questions from media and attendees, BML said.