Maldives Monetary Authority (MMA) and the Reserve Bank of India (RBI) have signed a Memorandum of Understanding (MoU) to facilitate the use of their respective currencies for transactions between the Maldives and India.
The agreement was signed by MMA Governor Ahmed Munawar and RBI Governor Shaktikanta Das.
Under the MoU, current account transactions, permitted capital account transactions, and other economic and financial activities will be conducted in Maldivian Rufiyaa and Indian Rupees, as agreed between the two countries. This includes the use of these currencies for the import and export of Indian goods and services.
According to MMA, the agreement will enable billing and settlement of transactions in the respective local currencies. It will also pave the way for trading the Maldivian Rufiyaa and Indian Rupee in the foreign exchange market. The arrangement reduces reliance on the US dollar, lowers transaction costs and expedite the settlement process for trade.
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