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Malaysia Likely to Reduce MM2H Minimum Deposit Requirement by 20-30% Following Review

The MM2H closed for new applications last month pending revised terms. Stakeholders hope for sharply reduced costs, writes Jolie Zhang.

Jolie Zhang
Kuala Lumpur

On October 1st, the Malaysian government informed that it would not process any new Malaysia My Second Home (MM2H) applications despite the online application portal’s remaining open for submissions. Since that date, MM2H agents have been awaiting the release of the long-hoped-for revised MM2H policy.

News has been circulating to indicate the deposit amount will drop from today’s MYR 1 million to between MYR 700,000 and MYR 800,000 and that, perhaps more consequentially, the compulsory 90-day annual physical presence requirement is likely to be scrapped. So far, however, the minimum qualifying age (35) looks to remain unchanged.

Agents have observed officers speeding up the approval process, which has led to an estimated 900 approvals (counting dependents) in the last quarter, indicating demand for the program still exists at the higher price point, though lower by an order of magnitude than before the much-criticized price increase.

On November 8th, the annual MM2H workshop discussed program-related topics. While details of the new MM2H policies are not available yet, we know that the Ministry of Tourism, Arts, and Culture (MoTAC) will form a one-stop center for the MM2H program together with the Malaysian Immigration Department. A political turf war between MoTac and the Immigration Department was reportedly to blame for the two-year suspension of the program between 2019 and 2021.

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Following the implementation of the current MM2H policy, in 2021, the government saw an 85% drop in application volume due to stricter requirements and a deposit amount as high as 1 million MYR (US$211,000). This elevated capital deposit requirement was particularly hard to swallow for many applicants in light of the Ringgit’s rapid depreciation in USD terms: Between January 2021 and October 2023, the Ringgit’s value in USD had fallen by some 16%. This made the prospect of locking up more than $200,000 in a fixed MYR deposit in Malaysia for the long term (applicants must keep the deposit to retain the visa) highly unappealing from a financial perspective.

The market has therefore welcomed news that the government has agreed to review – and, crucially, relax – the program’s terms. The question going forward will be whether a revised MM2H will be able to compete in a Southeast Asian golden visa market that now has more competitors than when the program was last active in 2019.

Southeast Asian Long-Stay Visa Comparison Chart

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Thailand’s Elite visa, for example, which has also become more expensive as of last month, offers a similar multi-year visa, but doesn’t have any physical presence requirements at all and charges a relatively small flat fee rather than requiring a bank deposit.

And, of course, the federal Malaysian MM2H policy must also compete with far cheaper and easier yet essentially identical programs of Sarawak and Sabah, two Malaysian states that control their own immigration policies. Sarawak, in particular, has seen its version of the MM2H thrive (a 2,800% increase in approvals thanks to the much stricter and more expensive terms offered on the mainland.

While MM2H offers virtually no additional benefits compared to the Thai Elite visa, the two programs’ focus is the same: To draw high-spending foreigners to the country so as to boost the Malaysian economy while not jeopardizing the local labor market.

Indonesia is another rising star in the Southeast Asian residency market. It first introduced its golden visa program in 2023 and, like Malaysia, requires a fixed deposit, though at the lower amount of US$130,000.

Unlike in the MM2H’s early years, Malaysia now has plenty of rival programs in its region. To remain competitive, the government cannot content itself with minor program revisions. To make an impact, particularly in light of Malaysia’s recent history of unpredictable treatment of foreign residents, the new program needs to be drastically better than what preceded it.

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