Less than a year into the enforcement of the changes to the Foreign Exchnage policy, several resorts and tourism establishments are reportedly struggling to adapt. As a result, some employees now face the prospect of being paid in Maldivian Rufiyaa rather than in U.S. dollars, raising concerns across the industry.
TTG Asia
In October 2024, the Maldives Monetary Authority (MMA) announced a new foreign exchange regulation aimed at addressing the country’s persistent dollar shortage—a challenge that has intensified since the onset of the COVID-19 pandemic. Officially implemented on 1 January 2025, the policy requires a fixed percentage of foreign currency earnings from the tourism sector to be deposited in local banks. While the regulation was introduced to improve the availability of foreign currency in the financial system, less than a year into its enforcement, several resorts and tourism establishments are reportedly struggling to adapt. As a result, some employees now face the prospect of being paid in Maldivian Rufiyaa rather than in U.S. dollars, raising concerns across the industry.
This is not the first time concerns have been raised about resorts and other tourism businesses switching from paying salaries and service charges in U.S. dollars to Maldivian Rufiyaa. Since the new foreign exchange policy came into effect, many employees in the industry have feared such a change—mainly because the U.S. dollar holds more value than the local currency. A shift to Rufiyaa-based payments would ultimately mean lower take-home pay, especially for those who rely on service charges to supplement their income.
While such discussions have come up in the past, it now appears that these changes may be moving forward more seriously. On 17 June 2025, local media reported that Universal Resorts had officially decided to stop paying service charges in U.S. dollars. According to Mihaaru News, a circular signed by the company’s Chief Operating Officer explained that after thorough consideration and internal consultations, the company would begin paying service charges in Maldivian Rufiyaa starting in July. The circular also stated that the decision was driven by operational challenges and the need to adjust until the government offers relief under the current dollar policy. Meanwhile, reports also suggest that Trans Maldivian Airways (TMA) is planning a similar move, citing similar difficulties in managing dollar-related transactions under the new rules.
Weighing in on the issue, prominent Maldivian politician and founder of the Villa Group, Qasim Ibrahim, shared his views in a statement posted on X (formerly Twitter). In his message, Qasim criticized the decision to pay resort staff in Maldivian Rufiyaa, calling it unfair to employees. He argued that since service charges are collected from tourists in U.S. dollars, staff should have the right to receive their share in the same currency. According to Qasim, converting these payments to Rufiyaa shortchanges workers and undermines the value of what they are rightfully owed.
If the employee refuses to receive the service charge other than in dollars, it is likely to be a case of deprivation of another person's property by fraud or tax under Article 212 of the Penal Code of the Maldives. Therefore, I believe that the result will be clear if an employee refuses to receive a service charge in Maldivian Rufiyaa without his consent and submits the matter to the court in accordance with the law. I also run Category A resorts with thousands of employees. We have this difficulty too. However, this is a huge right of the employees, the law also gives relief to the resorts when it comes to the dollar exchange policy.
The ongoing discourse surrounding the challenges faced by resort operators in paying their staff under the new Foreign Exchange Regulation began as early as the initial proposal stage. While the regulation was introduced to address the Maldives’ long-standing dollar shortage—an issue exacerbated by the COVID-19 pandemic—concerns from the tourism sector were vocal from the outset. Although many resorts expressed willingness to support the Maldivian economy during a time of financial vulnerability, prominent stakeholders like Universal Resorts consistently opposed the proposed amendments to the Act. The original draft of the policy mandated that all resorts convert USD500 per tourist into local currency. However, following consultations with industry stakeholders and economic experts, the government revised the regulation to make it more adaptable and less disruptive to business operations.
Under the updated policy, Category A establishments are now required to convert either USD500 per tourist per month or 20 percent of their monthly foreign currency earnings. Category B establishments must convert either USD25 per tourist per month or 20 percent of earnings. Additionally, entities that do not fall into either category but have earned at least USD15 million in foreign currency in the previous calendar year are also required to convert 20 percent of their monthly earnings into Maldivian Rufiyaa through local banks. These revisions were intended to balance the government's need to improve foreign currency reserves with the operational realities of tourism businesses.
Despite the initial scepticism, the government reported encouraging results soon after the policy came into effect. By the end of January 2025, tourism operators had deposited over USD25 million into domestic banks, offering a much-needed boost to the country’s foreign currency reserves. These early figures were seen as a strong indication that the policy was delivering its intended impact.
However, less than a year into its implementation, the very players who were resistant to the changes are now becoming more assertive in their opposition—especially as the effects of the regulation begin to reach their payroll systems. The recent shift by some major tourism operators, such as Universal Resorts and Trans Maldivian Airways, to pay staff service charges in Maldivian Rufiyaa rather than in U.S. dollars marks a significant escalation in this ongoing discourse.
Such a shift could seriously undermine the hard-won progress achieved through the new foreign exchange policy—and more importantly, it threatens the livelihoods of thousands of Maldivians who form the backbone of the country’s most vital industry. These are the people who leave their families for weeks or months at a time, often working long hours under demanding conditions, to serve the millions of tourists who come to experience the beauty of the Maldives. From room attendants and chefs to boat crew and dive instructors, these workers are the quiet force that keeps the tourism engine running day and night.
For many of them, the ability to earn part of their income—particularly service charges—in U.S. dollars is not just a perk; it’s a lifeline. That extra earning power allows them to send money home, save for their children's education, build homes, support ageing parents, and plan for a more secure future. It's what makes the sacrifices of working away from loved ones worthwhile. To now take that away, and replace it with the local currency, feels to many like a betrayal of their effort and dedication.
Stripping resort workers of this benefit could also discourage younger generations from seeking careers in tourism, weakening local participation in an industry that already heavily relies on foreign labour. In essence, this shift risks eroding one of the few direct, tangible ways that everyday Maldivians benefit from the billions flowing through the tourism sector. If the government and industry leaders fail to find a middle ground, the people who keep the Maldives’ biggest economic engine alive may be the ones to pay the highest price.
