All VISA card transactions to be made in MVR

VISA card used in Maldives | Photo: BML

Malé, Maldives – Maldives Monetary Authority (MMA) has issued a notice to all banks operating in Maldives to only use MVR in all VISA card transactions made in the country from 15 April 2021.

VISA’s National Net Settlement Service (NNS) was introduced in the Maldives in 2020. The implementation of this system allows banks to settle all transactions made with VISA cards with MVR. Previously, even transactions made using MVR had to be settled through USD.

MMA memo states that the authority has noticed that merchants in Maldives use USD in transactions where MVR is available subsequently forcing the customer to use USD. With the introduction of VISA NSS MVR can replace these USD transactions.

MMA has previously stated that all payments made to restaurants, guest houses and resorts should also be made in Maldivian Rufiyaa from 15 April onward.

The central banks decision comes while a bill had been presented to the parliament to ensure USD income benefits the state and also while the government had announced plans for lowering the use of USD within the country amid the shortages of USD which has caused inflation within the country.

The incumbent government plans to bring changes to lower the price of USD in the country, and works are in place to introduce structural reform to reduce the amount of shocks the economy of Maldives receives.

Visa National Net Settlement

Visa National Net Settlement is the VisaNet-enabled service that helps countries authorize, clear, report, and settle domestic transactions in their own currency using a local settlement agent. Visa Area Network Settlement enables similar functionality on a regional basis. These solutions allow you to support domestic transactions and the option of international transactions, all through a single interface without any direct implementation costs. Today, nearly half the countries in Latin America and Asia enable electronic payments within their borders use this service.