What changed
The ACU Board admitted Maldives Monetary Authority as a new member in June 2009, with operations starting January 1, 2010. All standard ACU provisions now apply to Maldives unless specifically exempted. Separate amendments to FEMA regulations and the ACU Memorandum will follow.
What it means for you
Indian banks can now settle trade transactions with Maldives through the ACU mechanism, reducing reliance on external currencies and lowering transaction costs. This expands the ACU network, facilitating smoother regional trade settlements. Banks must ensure compliance with existing ACU procedures and FEMA rules for Maldives-related transactions.
What you must do
- Update internal systems to include Maldives as an ACU member country for trade settlement.
- Train staff on ACU procedures for transactions with Maldives, effective January 1, 2010.
- Inform customers about the new ACU membership and its implications for trade with Maldives.
- Monitor RBI notifications for separate amendments to FEMA regulations and ACU Memorandum.
Who it affects
AD Category-I banks handling cross-border trade settlements, Importers and exporters trading with Maldives, Treasury and forex operations teams
When does the Maldives Monetary Authority start ACU operations?
Maldives Monetary Authority will commence ACU operations from January 1, 2010.
Do all ACU rules apply to Maldives?
Yes, all provisions of the ACU mechanism apply to Maldives unless specifically exempted.
What should banks do to prepare for this change?
Banks should follow existing ACU procedures and FEMA regulations, and inform their customers about the new membership.