Bangladesh eyes currency swap to facilitate remittances from Maldives

Highlights:

• Bangladesh Bank proposed three mechanisms to simplify remittance transfers from Maldives
• Proposals include rufiyaa payments, travel-related transactions and bilateral currency swaps
• More than 100,000 Bangladeshis work in the Maldives
• Remittances fell 16.4% to $118 million in FY2025–26
• Workers face high commissions and rely on curb-market dollars
• Implementation requires regulatory approval and cooperation between both countries

Bangladesh Bank has proposed three mechanisms to facilitate remittance transfers by Bangladeshi migrant workers in the Maldives, including the use of Maldivian rufiyaa, travel-related transactions and a bilateral currency swap arrangement.

In a letter dated 8 October to Ahmed Munawar, governor of the Maldives Monetary Authority (MMA), Bangladesh Bank Governor Md Mostaqur Rahman said Bangladeshi workers continued to face difficulties sending their earnings home despite efforts to strengthen formal foreign exchange channels in the Maldives.

He proposed cooperation between the two monetary authorities to establish safe, efficient, transparent and cost-effective mechanisms for transferring workers’ earnings through formal banking channels.

Under the first proposal, Bangladesh Bank wants to explore the use of Maldivian rufiyaa through an appropriate arrangement under the Asian Clearing Union (ACU). The corresponding funds would be paid to beneficiaries in Bangladesh in taka through authorised dealer banks.

The second proposal involves allowing licensed banks and money transfer operators in the Maldives to make eligible travel-related payments in rufiyaa for Bangladeshi nationals travelling to the country. In Bangladesh, authorised dealer banks could issue taka-denominated cards, with settlements handled through an agreed regulatory mechanism.

The third proposal seeks to explore a bilateral currency swap arrangement between Bangladesh and the Maldives to facilitate the repatriation of Bangladeshi workers’ earnings.

Bangladesh Bank said the proposed mechanisms would be subject to regulatory approval and compliance with the laws of both countries.

The central bank also expressed its readiness to hold discussions with the MMA through a joint delegation comprising Bangladesh Bank officials and representatives of the Bangladesh Mission in the Maldives.

The proposed meeting would focus on regulatory requirements, operational arrangements and settlement mechanisms for implementing the initiatives.

The BB letter said the proposals would require regulatory approval and compliance with both countries’ laws. 

According to 2024 data, the Maldives had more than 200,000 foreign workers, including over 100,000 Bangladeshis.

According to Bangladesh Bank’s country-wise remittance data, Bangladesh received about $118 million in remittances from the Maldives in FY2025–26, down from $141.1 million in FY2024–25. That represents a year-on-year decline of approximately 16.4%

According to Bangladesh Bank data, Bangladesh received $38.05 million in remittances from the Maldives during the first three months of the current fiscal year.

Challenges in sending remittances from the Maldives

Banks and exchange houses are reluctant to accept the Maldivian local currency directly. As a result, Bangladeshi expatriates have to buy US dollars on the curb market and send the money home through banks or exchange houses.

They also have to pay high commissions to transfer money through formal channels, leaving migrant workers facing financial losses in both the two ways.