An exporter of goods can receive trade proceeds either in ringgit or foreign currency (FC). Upon receipt, the exporter shall repatriate the export proceeds to Malaysia in full value within 6 months from the date of shipment. An exporter with export of goods proceeds of RM200,000 equivalent or less per invoice however may repatriate within 24 months from the date of shipment for permitted reasons.

An exporter can retain the export of goods proceeds received in FC in Trade Foreign Currency Account (TFCA) maintained with a licensed onshore bank up to 25% of the proceeds, with the remaining balance to be converted into ringgit. However, for an exporter with FC obligations (e.g. import payment, foreign currency loan obligation and foreign currency payable to resident SME net importer), they can retain FC up to their 6-month FC obligations, whichever is higher. This requirement however does not apply to receipt of export of goods proceeds of up to RM200,000 per transaction where such proceeds can be fully retained in the TFCA.

A large exporter with annual gross export of goods exceeding RM50 million equivalent in the preceding year shall submit report on quarterly basis to BNM within 21 days after the end of each reporting quarter.

Further Information

1. Notice 7 - Export of Goods [PDF]
2. Policy on Export of Goods Report Submission [PDF]
3. Frequently Asked Questions (FAQs) [PDF]

Application Submission

A resident exporter must apply before undertaking transactions other than stated above through online submission portal. Relevant application forms for reference and user guides are listed below. Please do not submit hardcopy application.

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A resident without domestic ringgit borrowing is free to invest any amount in foreign currency (FC) assets onshore and abroad.

A resident with domestic ringgit borrowing is free to invest:

• Up to RM1 million equivalent in aggregate per calendar year for resident individuals; or
• Up to RM50 million equivalent per calendar year in aggregate on corporate group basis for resident entities (include resident entities within the group with parent-subsidiary relationship),

A licensed onshore bank, a licensed insurer or licensed takaful operator is free to invest abroad for its own account.

A resident licensed unit trust companies, entity offering collective investment schemes including closed-end funds, fund managers or licensed insurer is free to invest abroad on behalf of their resident or non-resident client as follows:

• Up to 100% of Net Asset Value (NAV) or total funds belonging to resident client without domestic ringgit borrowing and non-resident clients in conventional and Shariah compliant assets; or
• Up to 50% of NAV or total funds belonging to a resident clients with domestic ringgit borrowing in conventional assets.

Further Information

1. Notice 3 – Investment in Foreign Currency Asset [PDF]
2. Frequently Asked Questions (FAQs) [PDF]

Application Submission

A resident entity or individual must apply before undertaking transactions other than stated above through online submission portal. Relevant application forms for reference and user guides are listed below. Please do not submit hardcopy application.

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• Any amount of ringgit to finance activities in the real sector in Malaysia from a non-resident entity within its group of entities or a non-resident direct shareholder;
• Up to RM1 million in aggregate from any other non-resident, other than a non-resident financial institution, for use in Malaysia; and
• Any amount through issuance of tradable securities or redeemable preference shares (RPS) denominated in ringgit in Malaysia to any non-resident.

By resident individual                                             
A resident individual is free to borrow:

• Any amount of ringgit from non-resident immediate family members; and
• Up to RM1 million in aggregate from any other non-residents, other than a non-resident financial institution, for use in Malaysia.

Further Information

• Notice 2 - Borrowing, Lending and Guarantee [PDF]
• Notice 5 - Securities and Financial Instruments [PDF]
• Information Note on Sukuk and Bonds
• Frequently Asked Questions (FAQs) [PDF]

Application Submission
A resident must apply before undertaking transactions other than stated above through online submission portal. Relevant application forms for reference and user guides are listed below. Please do not submit hardcopy application.

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Obtained by resident from non-resident      
A resident is free to obtain financial guarantee from a non-resident.

Issued by resident to non-resident     
A resident is free to issue financial guarantee in favour or on-behalf of a non-resident to secure borrowing obtained by a non-resident with some exceptions as follows:

• the non-resident borrower is a special purpose vehicle (SPV), therefore the resident shall be subjected to the rules on borrowing from abroad; or
• the underlying borrowing will be repaid by a resident, other than when financial guarantee is called upon. In such cases, the resident shall be subjected to the rules on investing in foreign currency.

Further Information

1. Notice 2 - Borrowing, Lending and Guarantee [PDF]
2. Frequently Asked Questions (FAQs) [PDF]

Application Submission
A resident must apply before undertaking transactions other than stated above through online submission portal. Relevant application forms for reference and user guides are listed below. Please do not submit hardcopy application.

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Payment in foreign currency between residents    
A resident is free to pay or receive foreign currency (FC) to or from another resident for the following:

• Any purpose between immediate family members;
• Education, employment or migration outside Malaysia;
• A transaction between the resident and a licensed onshore bank, a licensed international takaful operator or an international currency business unit of a licensed takaful operator, in the conduct of the latter’s business involving FC;
• Settlement of –
  • a FC-denominated derivative, excluding exchange rate derivatives, transacted on a Specified Exchange under CMSA between the resident and a resident futures broker;
  • a commodity murabahah transaction between residents undertaken through a resident commodity trading service provider; or
  • a domestic trade in goods or services between a resident entity with FC export earnings (payor) and a resident entity which is a Small and Medium Enterprise (SME) and a net importer (payee), subject to specified conditions.

A non-SME resident net importers may apply for approval by submitting an application via email to Foreign Exchange Policy Department.

Payment in foreign currency between resident and non-resident
A resident is free to make or receive FC payment to or from non-resident for any purpose, except for –

1. FC-denominated derivatives offered by the resident unless it is approved by BNM or allowed under Part B of Notice 5;
2. FC-denominated derivatives offered by the non-resident; or
3. Ringgit-denominated derivatives unless it is approved by BNM or allowed under Part B of Notice 5.

However, FC payment relating to (2) above can still be undertaken for –

• FC-denominated derivatives, except for ringgit-related exchange rate derivatives,  purchased by a licensed onshore bank for its own account;
• FC-denominated interest rate swap between the resident and Labuan bank to manage interest rate exposure arising from FC borrowing; or
• FC-denominated derivatives, except for exchange rate derivatives, offered on a Specified Exchange stipulated under the Capital Markets and Services Act 2007 [Act 671] undertaken through a resident futures broker by the resident (subject to Notice 3 if undertaken without firm commitment); or
• FC-denominated derivatives, except for exchange rate derivatives, purchased by a resident individual from a non-resident (subject to Notice 3 if undertaken without firm commitment).

Further Information

• Notice 4 - Payment and Receipt [PDF]
• List of information or documents required for applications of non-SME resident to receive foreign currency from a resident exporter [PDF]
• Frequently Asked Questions (FAQs) [PDF]

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A resident is free to buy or sell ringgit against foreign currency (FC) with a licensed onshore bank (excluding international Islamic banks) on spot or forward basis for current and financial account transactions either on firm commitment or anticipatory basis.

For FX hedging of FC obligations, a resident is free to sell ringgit against FC with a licensed onshore bank on –

1. spot basis up to the aggregate of its 6-month FC obligations; or
2. forward basis up to the underlying tenure of its FC obligations.

A resident is free to cancel or unwind an existing forward transaction involving ringgit for any underlying commitment (except portfolio investment) with any licensed onshore bank.

Under Dynamic Hedging Framework, a resident institutional investor registered with BNM is free to enter into forward contracts to buy ringgit up to 100% of its invested underlying FC-denominated asset or unwind the forward contracts entered, without documentary evidence with a licensed onshore bank, for the purpose of managing its FC exposure. The unwinding of its initial forward contract can be undertaken with the same or different counterparty licensed onshore bank it has entered the initial forward contract with.

A resident is free to hedge FC-denominated derivative contracts, other than exchange rate derivatives, offered by a resident provider up to the net open position (NOP) of the FX exposure with any licensed onshore bank. The resident is required to unwind the forward position if it exceeds the NOP.

A resident entity is also free to undertake the FX transactions involving ringgit above on behalf of the resident and non-resident entity within its group of entities (excluding financial institutions) with a licensed onshore bank.

Further Information

1. Notice 1 - Dealing in Currencies, Gold and Other Precious Metals [PDF]
2. Frequently Asked Questions (FAQs) [PDF]

Application Submission
A resident institutional investor can register for dynamic hedging framework by submitting Forward Market Participation Form – Institutional Investors for Dynamic Hedging Framework [PDF]