Banks and Financial Institutions to Boost Transparency and Cooperation
The Maldivian government has introduced amendments to the Banking Act (Law No. 12/2018) to strengthen the financial sector and prevent money laundering. The changes aim to enhance transparency and cooperation among banks and financial institutions.
Key Amendments
- Cooperative Systems: Banks and Money Service Businesses (MSBs) may establish cooperative systems for fund transfer, account settlement, and payment processing.
- Reporting Obligations: Banks are now required to report suspicious transactions to the Financial Intelligence Unit of the Maldives Monetary Authority (MMA) within two working days.
- Banking Secrecy: The banking secrecy provision will not be invoked as a ground for non-compliance with reporting obligations related to suspicious transactions.
- Information Exchange: The MMA may require banks to provide additional information, documents, or reports beyond those prescribed under section 46(a).
- Deposit Insurance: Banks are authorized to participate in deposit insurance schemes based in the Maldives or elsewhere, subject to conditions and regulations imposed by the MMA.
New Requirements
- Participation in Development Projects: Financial Institutions will be required to participate in development projects carried out by the MMA for financial sector development and financial inclusion.
- Service Fees: The MMA may levy fees on banks for services provided.
- Annual Fee or Licence Fee: The MMA may charge an annual fee or licence fee from banks.
Implementation
The amendments will come into effect upon publication in the Gazette of the Government of Maldives. All references to specific sections or parts of a section in the Banking Act will be updated to reflect the changes.
Objectives
The amendments aim to:
- Enhance transparency and cooperation among banks and financial institutions
- Prevent money laundering and terrorist financing
- Promote financial inclusion
- Strengthen regulations and reporting requirements
By introducing these amendments, the government aims to create a more robust and transparent financial sector in the Maldives.