For many businesses in APAC, Malaysia is one of the prime regions for doing business including opening regional offices, hiring contractors, setting up supply chains etc. Specifically, Malaysia has emerged as a key market for businesses looking to expand in the region and globally.
While it’s a great opportunity for businesses to get the services they need at affordable rates, it also means that money has to travel across borders to make business payments to your partners in Malaysia, usually in their local currency Malaysian Ringgit.
Malaysian Ringgit or RM (MYR) is one of the thinly traded currencies in the market. Currencies, like MYR, that are usually traded at low volumes can be very volatile and can be heavily influenced by political and economic instability.
Many businesses that need to make payments in exotics like MYR are usually not nearly educated enough in the intricacies and potential problems that exotic currencies bring. In this guide, we aim to remove the mystique associated with such exotic currencies, aid understanding in an easy-to-digest manner, and provide advice to CFOs and other business decision-makers regarding the approach and management of this type of currency.
What are Exotic Currencies and why Malaysian Ringgit is one of them?
Forex markets across the globe have divided currencies into three groups: Major, Minor, and Exotic currencies. The reason for this classification is on the basis of how well they trade in the currency market.
So Exotic currencies are those currencies that trade thinly or at low volumes. They are illiquid and lack market depth. Trading at low volumes does not necessarily mean weak or undervalued currencies. Exotic currencies don’t show a popular behavior in the trading market and are available in very limited volumes, like Malaysian Ringgit.
Exotic currencies bring with them considerable confusion and a widespread lack of understanding. If considering operating in a country with an exotic currency, it is absolutely essential to fully understand what your business is getting into before making any decisions.
Frequent problems faced with making transfers in Malaysian Ringgit
Making business payments in exotic currencies like Malaysian Ringgit needs to be vigilant with rules and regulations. It is not unknown to have payments declined or misplaced in the banking system due to errors at the execution stage.
Bank codes for certain locations can differ from the familiar BIC and IBAN requirements and additional information may also be required when making a payment. It is fundamental therefore to employ the services of a provider with proven delivery experience in this currency.
Typical issues and challenges associated with MYR payments:
- Volume – As an exotic currency, MYR sees the lowest trading volumes compared to major currencies today. As a result, Banks and some FIs charge expensive and non-transparent margins on it.
- Delayed Payments - Routes used for transfers of funds are typically long and complex if the provider does not have a direct payment partner in the region.
- Leverage – The pair’s volatility can increase profits using leverage, however, it can also create significant losses. Wallex deploys advanced risk management tools which help us hedge risks and lock rates for you for up to 24 hours from committing the transaction.
How to set up a payment in MYR?
Wallex makes it really easy to make B2B payments in MYR.
Step 1: Open Wallex Account for free
Signing up is 100% free. There are also no maintenance fees so you don’t have to worry about unnecessary expenses eating into your profits.
Step 2: Add your beneficiaries & start transacting
Once your account is approved, you can add your Malaysia beneficiaries and set up your FX payment online. This only takes a few minutes, and you can start sending payments almost instantaneously. Pay from your Wallex account or from your bank.
Step 3: Track payments
Wallex offers complete transparency so you can track your payments at any time. Payments are received faster than international wire transfers and with real-time tracking, you'll watch it arrive safely.
How much does it cost to send money to Malaysia?
With Wallex, sending money in MYR has a small service fee in most cases and the FX rate applicable is updated in real time. You can check the indicative rate for setting up a payment here. Remember, the more you send in a single transaction, the more you will save.
How long will a money transfer to Malaysia take?
Wallex can send money from Singapore , Hongkong and Indonesia to Malaysia on the same day. Sometimes, different payment methods or compliance checks may affect the transfer delivery time. You can keep track on the Wallex online dashboard which has real time updates, and our team will keep you updated in case of any delays.
Which exotic currencies do Wallex offer?
Wallex supports payments in 46 currencies to more than 180 countries. Below are a few examples of exotic currency on offer with a Wallex Business Account.
See the full list of 46 currencies supported, payment cutoff and delivery time.
Get the best exchange rate for Malaysian Ringgit with a trusted provider like Wallex
When making an international payment for your business, there are a large number of traditional banks, foreign exchange and fintech providers that will allow you to exchange Singapore Dollars for Pounds, Euros or US Dollars. However, if you need to make payment in exotic currencies like Malaysian Ringgit, you will find that some exchange providers are unable to cater for your needs.
Malaysian Ringgit is a specialist product for many FX providers, which is why it can be challenging to find an option, let alone an efficient and cost-effective one. Fortunately, at Wallex we pride ourselves on providing a specialist service designed to get your money where it needs to be.
Here’s why Wallex is the best solution for your business to make payments in MYR
- Transparency of FX rates and fees
- Security in fund delivery on time
- All transactions can be done online
- Visibility on where funds are
- Clarity on the route used and number
- Faster delivery of funds
- Dedicated account manager to help you with any enquiries
Wallex Simplifies Cross-Border Payments
Wallex is an affordable and secure payments and liquidity management solution for businesses.
Businesses of all shapes and sizes use a Wallex business account to make and receive cross border payments, hold balance in and convert funds in over 46 currencies.
With Wallex, our clients can efficiently plan, manage and hedge their currency needs all from one secure online platform.
Future forward companies like Investree, Style Theory, CodePay, Ismaya Group, Marugame Udon and 25,000+ customers in Asia made the switch to Wallex, trusting us to transfer over US$ 2bn in customer funds across borders.
If you would like to know more about how Wallex can help your business, visit www.wallex.asia to schedule a demo