Maltese importers try to avoid paying via letters of credit and drafts, as these increase the cost of the imported goods. Before giving credit, U.S. companies should obtain credit background information on the companies involved. The Commercial Section of the U.S. Embassy can provide basic background information.
Other sources of information include:
- The Malta Chamber of Commerce and Enterprise
- The Malta Chamber of SMEs
Credit info provides full background credit reports (local agents of Dun & Bradstreet):
For more information about the methods of payment or other trade finance options, please read the Trade Finance Guide available at https://www.trade.gov/trade-finance-guide-quick-reference-us-exporters.
Banking Systems
The 2002 Central Bank of Malta Act and the 1994 Banking Act govern banking in Malta; the Malta Financial Services Authority (MFSA) primarily administers the banking legislation. The two major banks in Malta are HSBC (Malta) Ltd. and Bank of Valletta. They each operate about 40 branches across Malta, and together they control over 80 percent of the Maltese banking market. The next three leading banks are Lombard Bank (Malta), BNF Bank, and APS Bank. Commercial banks offer all forms of commercial banking services. Interest rates on foreign exchange deposits are in line with those prescribed by international money markets.
Backed by a worldwide correspondent network, banks in Malta offer a broad range of foreign exchange operations, including forward cover and expenditure payment services. However, most U.S. correspondent relationships rely on European intermediaries, often resulting in higher transaction fees. The banks provide standard lending services: overdraft, loan, and trade finances. Banks in Malta are flexible in considering applications for finance.
Foreign Exchange Controls:
There are no foreign exchange controls that might negatively affect trade. Banks automatically grant permission for foreign exchange payments abroad on presentation of supporting documentation. Businesspersons can exchange their dollar currency and travelers checks at banks, exchange offices, and hotels. Major credit cards are generally accepted with proper identification, though it is best to confirm what forms of payment are acceptable at each place of business.
Malta’s foreign exchange rules conform to relevant EU regulations, with built-in controls to facilitate the enforcement of money-laundering laws and tax collection.
U.S. Banks and Local Correspondent Banks
No U.S. bank has a branch in Malta. No local bank maintains a direct correspondent banking relationships with U.S. banks. Some local banks act as correspondents of U.S. banks via other EU banks, though such a relationship often results in higher transaction costs.
The majority of banks have stopped opening accounts for companies not operating in Malta or which operate in the igaming sector. The few banks that still offer this service have tightened their due diligence processes, resulting in long delays to open accounts.