Bank Negara announces full rollout of Qualified Resident Investor Programme
17 June 2025
To encourage two-way flows in the onshore foreign exchange market, Bank Negara Malaysia (“
BNM”) announced on 12 June 2025, the full rollout
1 of the Qualified Resident Investor (“
QRI”) Programme for eligible corporates with effect from 1 July 2025.
In its media release of 12 June 2025, BNM highlighted that eligible resident corporates are only required to complete a one-off registration with BNM to benefit from the flexibility in managing future direct investments abroad (“
DIA”) that will not require prior approval from BNM.
Some of the salient conditions/ features of the QRI programme are set out below.
- What is the benefit of participating in the QRI programme?
A QRI that has been successfully registered with BNM will not require prior approval from BNM to reconvert the converted ringgit funds for future DIA.
- Who is eligible for the QRI programme?
Resident corporates that repatriate and convert proceeds from overseas investments and meet the following criteria:
- good corporate governance and compliance with the Foreign Exchange Policy (“FEP”); and
- proven track record in conducting foreign exchange (FX) activities.
- Is there any threshold on the outstanding DIA assets of corporates to be eligible for the QRI programme?
No, the QRI programme is open to all eligible resident corporates, regardless of the size of DIA assets.
- What type of investment abroad is allowed for the reconversion?
The reconversion of funds from ringgit into foreign currency is allowed for DIA purposes only. DIA as defined in the FEP Notices refers to the following:
- an investment in Foreign Currency Asset Offshore by a resident resulting in at least 10% equity ownership or control of a non-resident entity outside Malaysia or a Labuan Entity;
- an inter-company lending by a resident entity to a non-resident entity within the resident entity’s group where the non-resident entity is outside Malaysia or a Labuan Entity; or
- a capital expenditure by a resident investor in an unincorporated entity outside Malaysia or a project outside Malaysia by an agreement with no establishment created, where the resident investor:
- contributes capital of at least 10% of the project cost;
- is entitled to at least 10% of profits from the unincorporated entity or project; or
- has management control of the unincorporated entity or project.
- What types of repatriated funds qualify for the QRI programme?
The eligible funds that qualify for the QRI programme are:
- income and proceeds from overseas investments (e.g. dividends, interest income, divestment proceeds); and
- existing foreign currency funds retained in an Investment Foreign Currency Account with licensed onshore banks (“LOBs”) in Malaysia.
- Can a resident corporate that repatriates foreign currency funds, but chooses not to convert those funds into ringgit, be eligible to utilise the QRI flexibility?
No, a resident corporate must first repatriate and convert the foreign currency funds to ringgit to utilise the flexibility offered under the QRI programme.
- Can funds that were previously converted from foreign currency into ringgit prior to onboarding into the QRI programme be deemed eligible?
No, only foreign currency funds repatriated and converted into ringgit after successful onboarding into the QRI programme by BNM are eligible.
- Can a resident corporate apply on a corporate group basis?
Yes, a resident corporate can apply and be onboarded into the QRI programme on a group basis with a parent-subsidiary relationship. Thus, the resident corporate that repatriates and converts foreign currency funds from overseas investments can be different from the resident corporate that reconverts the funds for DIA purposes at a later stage, as long as both corporates are within the same corporate group with parent-subsidiary relationship.
- Is there a time frame for application submission for the QRI programme?
Applications can be submitted to BNM from 1 July 2025 until 30 June 2028. Onboarded corporates must first repatriate and convert eligible foreign currency funds into ringgit within the said flexibility period to enjoy the QRI reconversion flexibility.
- How do resident corporates register for the QRI programme?
Application for the QRI programme must be submitted online using the GEN Form via the FEP Portal. Corporates will need to attach the QRI application form along with the latest three years of audited financial statements (on a consolidated group basis) in the GEN Form.
- Is there any reporting requirement for QRI?
Yes, an onboarded QRI corporate is required to provide periodic reporting to BNM on conversion and reconversion activities.
- What is the timeline required for a QRI to convert the committed foreign currency funds into ringgit after joining the QRI programme?
There is no set timeframe for a QRI to convert foreign currency funds into ringgit. However, QRIs are strongly encouraged to do so within a reasonable period upon successful onboarding into the QRI programme to benefit from the reconversion flexibility.
2
- Does a QRI corporate have to maintain the converted ringgit funds in a special ringgit account?
No. A QRI can maintain the funds in its existing ringgit account with LOBs in Malaysia.
- Is there a minimum or committed amount that resident corporates are required to fulfil under the QRI programme?
No, there is no minimum or committed amount that resident corporates are required to repatriate and convert. However, only the amount that has been converted into ringgit can subsequently be reconverted into foreign currency for future investments.
- Is there a deadline for the reconversion of ringgit into foreign currency for DIA purposes under the QRI programme?
No, there is no deadline. The flexibility is valid based on the amount of foreign currency converted into ringgit by the QRI.
- Is the QRI still eligible for the RM50 million annual permissible limit for investment abroad in addition to the amount allowed for reconversion for DIA under QRI programme?
Yes, the QRI and its corporate group are still eligible for the RM50 million annual permissible limit in addition to the amount of foreign currency funds that have been converted into ringgit under the QRI programme.
- Can the converted and reconverted funds at later stage be of different currency denominations?
Yes. However, it is advisable the USD equivalent be used as a reference.
- Are QRIs required to provide any documents to the LOBs to facilitate reconversion of ringgit funds for DIA?
Yes, QRIs must submit the relevant supporting documents to facilitate the LOBs’ due diligence process, including a copy of the registered QRI letter issued by BNM and a declaration confirming that the reconversion amount does not exceed the total converted foreign currency amount under the QRI programme.
1 According to BNM, the full rollout builds on the success of the pilot programme, introduced in April 2024, which has generated cumulative inflows from participants exceeding USD1 billion into the domestic financial market.
2 Based on FAQ 9 above, the eligible foreign currency must be converted into ringgit within the flexibility period (i.e. starting 1 July 2025 and no later than 30 June 2028).
This alert contains general information only. It does not constitute legal advice nor an expression of legal opinion and should not be relied upon as such. For further information, kindly contact skrine@skrine.com.