The Myanmar financial sector has been through a tumultuous year because of the impacts from the Covid pandemic and instability following the assumption of power by the military on 1 February 2021.
In response to the banks in Myanmar hit by a severe liquidity crisis, the Central Bank of Myanmar imposed cash withdrawal limits. Of MMK500,000 per day with a maximum of MMK2 million per week for individuals and MMK20 million per week for corporate account holders.
In a letter issued by the CBM on 1 April 2022, the CBM has kept these cash withdrawal limits the same but has provided some additional clarification on exceptions to these limits.
Exceptions to the maximum withdrawal limits, which have now been clarified include:
withdrawals of MMK10 million per week for individuals to cover health care costs and for religious purposes
unlimited withdrawals to pay the salary of employees working in industrial zones
withdrawals of up to MMK100 million per week for factories in industrial zones to spend on buying raw materials
withdrawal of up to MMK100 million per week for certain expenses incurred by government departments
Funds remitted into the country and received by NGOs, INGOs and international organisations are not subject to any withdrawal limits, but withdrawals need to be agreed to with banks considering the respective bank’s liquidity status.
While these changes to the cash withdrawal limits will not affect most individuals and companies which hold accounts at Myanmar banks as their limits remain unchanged, in practice the situation is improving. Twelve months ago, when the cash withdrawal limits were introduced, most banks branches were closed, and it was exceedingly difficult for customers to be able to withdraw their cash. Tokens allowing entry into banks and the withdrawal of cash were almost impossible to obtain. Now most banks are open for business with customers being able to withdraw cash whenever they wish.
It should be noted that banks still have withdrawal limits below those imposed by the CBM with most individuals limited to withdrawing between MMK500,000 to MMK1 million a fortnight and corporate customers generally only allowed to withdraw MMK5 million every 2 weeks. All except for a select few of the ATMs are still not operational.
Comments