KUALA LUMPUR, Aug. 2 (Xinhua) -- Bank Negara Malaysia (BNM) and Bank Indonesia announced Monday the expansion of the ringgit-rupiah settlement framework.
BNM said in a statement that the expanded framework now includes direct investment, income and transfer, in addition to trade, as eligible underlying transactions.
It also includes expansion of eligible users of the framework, such as individuals, and additional foreign exchange policy flexibility, such as simpler documentation requirements, to facilitate the operationalization of the framework.
"This expansion, which will be effective from today (Aug. 2), is part of the continuous effort to facilitate wider use of local currencies for settlement of trade and direct investment between Malaysia and Indonesia," said BNM.
The framework was first launched on Dec. 11, 2017 in accordance with the Memorandum of Understanding between BNM and Bank Indonesia that was signed on Dec. 23, 2016.
Given the expansion, BNM and Bank Indonesia have also appointed additional qualified commercial banks in both countries to support the operationalization of the expanded ringgit-rupiah settlement framework.
"In general, the appointed banks are experienced in facilitating trade and direct investment between the two countries, have a wide customer base and have established strong business relationships with banks in the counterparty country," said BNM. Enditem