Reserve Bank of Malawi sets conditions for Diaspora Foreign Currency Denominated Accounts including exchange control exemption and 50% monthly withdrawal cap

The Reserve Bank of Malawi published an update clarifying the conditions governing the newly introduced Diaspora Foreign Currency Denominated Accounts (FCDAs), covering eligibility, funding sources, account-opening documentation and key operating rules for cross-border payments and withdrawals. Diaspora FCDAs are foreign currency accounts held in Malawi by Malawian citizens who have lived outside Malawi for more than 12 consecutive months and must be funded with money not originating from Malawi and not derived from export proceeds. Authorized Dealer Banks may open accounts on the basis of documentation such as an employment offer letter (and acceptance) exceeding 12 months, valid work or residency permits, an education admission letter for over 12 months, or other evidence of residence abroad beyond 12 months, and may offer features including reduced paperwork, online account opening and access, debit cards and a dedicated diaspora private banker. Cross-border remittances and payments from Diaspora FCDAs are not subject to Exchange Control requirements; hard currency withdrawals are permitted once per calendar month up to 50% of the account balance, with Reserve Bank approval required for withdrawals above that limit. Permitted transfers include to other Diaspora FCDAs, to Non-Resident FCDAs, and to Resident FCDAs including to foreign exchange bureau FCDAs for Malawi kwacha equivalent cash or bank transfer, and inflows may continue to be treated as diaspora funds if the account holder returns and provides proof of earnings.