The Official Currency of the Maldives (Maldivian Rufiyaa)
The official currency of the Maldives is the Maldivian rufiyaa which goes by the abbreviation, MVR. One rufiyaa is divided into 100 laari. The rufiyaa was introduced in 1947, replacing the Indian rupee. The “rufiyaa” gets its name from the Sanskrit rupya, meaning “wrought silver”.
The Maldivian rufiyaa is pegged to the US dollar at a rate of 0.0492 USD for every MVR and the peg has been in place since 1983. The Maldives Monetary Authority is responsible for issuing the currency.
The History of the Maldives Currency
The Maldives has had a long and complicated history with its currency. For centuries, the Maldives was a sultanate where multiple foreign currencies were being used. In 1887, the British established a protectorate over the Maldives. The British pound was introduced as the official currency but the Maldivian rufiyaa was also minted and used alongside it. In 1965, the Maldives became a sovereign and independent nation. This led to phasing out of the British pound before the Maldivian rufiyaa was made the sole legal tender.
- The Maldivian rufiyaa is divided into 100 laari.
- The circulation of coins goes like 1, 2, 5, 10, 25, and 50 laari.
- The banknotes are 50, 100, 500, and 1000 rufiyaa.
- The rufiyaa is pegged to the US dollar at a rate of 15.38 MVR for every dollar.
Maldives introduced a new currency in 2016, the Maldivian laari. The laari is divided into 100 dirhams. The circulation of coins goes like 1, 2, 5, 10, 25, and 50 dirhams. The sequence for banknotes is 50, 100, 500, and 1000 laari. The laari is pegged to the US dollar at a rate of 15.38 MVR for every dollar.
The Maldives Currency Today
The Maldives currency is used only within the country nowadays. It can be used to buy goods and services, and to pay for taxes. The rufiyaa is pegged to the US dollar, and the exchange rate stays fixed at MRF 12.85 to USD 1.00. The Central Bank of the Maldives handles the issue and regulation of the currency.
The rufiyaa has went through several changes since it was first introduced. In 1971, the government decided to decimalize the currency, and 100 laari became equal to 1 rufiyaa. In 1977, the government introduced a new series of notes before being replaced in 1981 by an even newer series. In 2004, the Maldives switched to using the euro as its official currency. This change, however, lasted only a few months and the rufiyaa was reintroduced in 2005.
How to Use the Maldives Currency
The Maldives currency can be used in several ways.
- It can be used to purchase goods and services at shops and businesses, pay taxes, and withdraw cash from ATMs.
- One can also use their rufiyaa for making bank transfers and buying foreign currency.
NOTE : When using your rufiyaa to make purchases, you are given an option of whether would cash or a card be used. If you are paying by card, you must show your passport or ID card to the cashier. You may also be asked to provide your fingerprint as part of the payment process.
How to Exchange Maldives Currency
If you want to exchange Maldives currency for another currency, you can do so at banks, airports or hotels. You’ll need to present your passport, and you may be charged a fee. It’s also possible to exchange currency online.
When exchanging currency, it’s a compulsion to know what the current exchange rate is at that time. One can find this information online or by contacting your bank. It’s also a good idea to have some local currency in hand in case you need it for incidentals.
The Future of the Maldives Currency
The future of the Maldives currency is highly uncertain. Maldives at present has faced economic challenges which bring with them some serious complications for the currency. The government aims to improve the economy which is likely to have a positive effect on the currency as we move forward with time.
The Maldives is instilled with a lot of potential for economic growth. The country has an abundance of natural resources making it a popular tourist destination. The government is working to improve the infrastructure, and this is likely to attract more investment. The currency is likely to benefit from this in the longer horizon.
Being a small country proves to be a demerit when it comes to the currency of the Maldives. The country is not very diversified which makes the currency more volatile. The government is working on diversification of the economy, and this is likely to have a positive effect on the currency in future periods.