Effective 1st January 2019, all commercial banks in Malaysia are required to report all cash transactions amounting to at least RM25,000 to Bank Negara Malaysia. This new regulation is seen as an effort by the central bank to curb money laundering and the blank economy.
The limit which is known as the Cash Threshold Report is currently set at RM50,000. This covers all cash transactions including both local and foreign currencies, as well as bearer negotiable instructions which include travellers’ cheques. However, it excludes bank drafts, cheques, electronic transfers or fixed deposit rollovers and renewal.
According to BNM, the CTR requirement is applicable to single or multiple cash transactions within the same day. They gave an example whereby a deposit of RM40,000 and a withdrawal of RM20,000 will give an aggregated transaction amount of RM60,000, and this will be required to be reported as it exceeds the current threshold of RM50,000.
It’s worth highlighting that banks will still allow you to withdraw or deposit cash amounting to RM25,000 and above. However, customers will be required to declare the source of the fund and purpose of the transaction. At the moment, anyone can bank in any amount under RM50,000 without any questions asked. So, if you want to avoid the hassle, you are encouraged to transfer electronically from bank to bank.
When the move was announced two months ago, it was revealed that Malaysia ranks #10 in the list of illicit money outflows and money laundering offences in the world. Interestingly, Malaysia currently has one of the highest mandatory cash deposit