MM2H – Malaysia My Second Home

Interview: Datin Sharifah Ikhlas Syed Ismail Aljaffree, Director of the Malaysia My Second Home Centre for Malaysia’s Ministry of Tourism and Culture

Key topics covered:

  • Overview of the scheme
  • How the approval process works
  • Key source markets
  • Different interest for different states
  • Key challenges for the programme
  • Key benefits of joining the programme

Datin Sharifah Ikhlas Syed Ismail Aljaffree is Director of the Malaysia My Second Home Centre for Malaysia’s Ministry of Tourism and Culture. We asked her firstly to give us a general overview of the scheme.

Malaysia My Second Home is fondly abbreviated as MM2H. The programme was launched in 2002 as an initiative by the Malaysian Government. The objective is to attract foreigners from any country, who fulfil certain criteria to come and stay in Malaysia for a longer period of time. For this, they are given a multi-entry visa which is renewable after ten years, as well as a social visit pass. Under this programme, you can bring your spouse and family as dependents. Children below the age of 18 count as dependents and can even go to local schools provided they meet certain criteria. Parents and parents-in-law also can benefit from the scheme. Of course, there are some terms and conditions for who can apply under the programme. For people to apply to come in under this programme, they must meet certain criteria. The first screening concerns financial requirements. In the pre-application we look at two categories: people 50 years and above, and people 50 years and below. 50 years and above, you must show that you have a liquid asset of 350,000 Malaysian Ringgit in your personal bank account. Then for those 50 years and below, you have to show 500,000 Malaysian Ringgit in your bank account. That is your first screening. So, if you can manage to show that, in your own personal account, then we go to the next step, which is that you must have offshore income of 10,000 Ringgit per month – this meaning any oncome that comes in from outside of the country. After that, once you have qualified for these two screenings, you will be given an approval letter, following which you have to open a fixed-deposit account. For the fixed-deposit account, those aged 50 and above, you have to put in about 150,000 Malaysian Ringgit, and for those 50-years and below, you have to open a fixed-deposit account of 300,000 Malaysian Ringgit. After you have met the financial requirements, we look at the person, to ensure they have no criminal record of any kind, through a letter of good conduct from an agency in your home country that is able to verify your criminal record. Besides that, you must have medical insurance that will be able to cover you in Malaysia, and you and all dependents will be required to undergo a medical check-up in a local clinic here in Malaysia. After that; you must fulfil all the immigration requirements, for which the cost differs for the social visit pass and multiple entry visa from country to country. This programme is regulated under the immigration department, and the Ministry of Tourism works on the promotion of the programme. So, it’s a collaboration between several government agencies. We have an approval committee which will look into the application. The committee is headed by the Director General of Immigration, and is also co-chaired by the deputy secretary general of the Ministry of Tourism. The other members of this approval committee are the special branch of the Royal Police of Malaysia, we have three divisions from the Immigration Department: intelligence, visa and passes, and enforcement. These three will examine the visa application, and the special branch looks at the medical report and works together with Interpol examining the applicants’ files. The centre I am heading right now is the secretariat for the approval committee. We also have the licencing department which is under our ministry also, that looks into the association that acts as an agent for these applicants. The application can either be done directly, by post, or you can send it online, or you can use an agent to act on your behalf. We have an association of agents, where we work closely with them, and the licence will be given by us, under the licencing department. The agents have to undergo a course in order to understand all the mechanisms involved and they must understand how one must act on behalf of the applicants, so that they don’t short change their clients. In terms of the fee they charge their clients, we do not determine this, it’s the market forces. It depends also on the services offered from one agent to another. The agents work closely with us, because we are the ones who regulate their licences.

What happens once the request is conditionally approved?

We produce a conditional approval letter explaining that the applicant, while approved, may not interfere in the sensitivity of the country, the politics of the country, and that you must fulfil all the costing for the social visit pass, and multiple entry visa and so on, and once that’s settled, you get your endorsement. The technical part is also that you have to settle the endorsement within six months after you have been given the conditional approval letter.

Where are most MM2H applicants from?

China is the country that has the highest number of participants in this programme, at around 47%. We have about 130 participating countries and we currently have over 38,000 people in the programme. Top countries also include South Korea, Japan, Bangladesh and the UK. We also have a good number from Hong Kong and Taiwan. Australia and the US are showing a very good response to this programme, as well as Singapore. Applications are very strong at the moment, running at around 500-600 a month. We do not want to focus on one country as a supply market. We want to get a diversity of nations coming in, creating a cross-cultural social effect on the local communities.

What attracts people to the scheme?

Each nationality has different factors as to why they want to choose Malaysia. Different nationalities have different priorities. For Chinese people, they may be tired of the harsh winter conditions in some parts of their country. The same thing goes for Japan, because of the very cold winter in their country. So, the climate is a very traditional factor influencing the decision. People choose Malaysia for the climate, the location, the affordable cost of living, and perhaps for other family members that had already migrated here. But things are evolving. After the more traditional reasons, now we are seeing Chinese people coming here because of property investment, for the affordable medical facilities of very high quality. They also come for the IVF. In some cases, it’s also for the good level of education they can find here for their children.

Do different states attract different people?

Indeed! British retirees are very attracted by Penang, for the lifestyle, and thanks to the British heritage linked with the island. Chinese and Japanese are attracted to Kuala Lumpur and Selangor. Americans and Australians are proving to be attracted by Johor Bahru. Younger people in general tend to be more attracted to KL, for the vibrant lifestyle, amenities and infrastructure. Some of these people are professionals, who have a work base somewhere else in Southeast Asia. It may be that the husband is working in Hong Kong. He will put his family residing in Kuala Lumpur. The same goes for the US and European nationals. Many of them have worked with a multinational company here in Malaysia before, and as they have been exposed to the lifestyle and they like the climate here, and they like the cost of living.

What are the key challenges you are facing with this programme?

There are many countries offering this kind of long stay programme, so we are competing with countries like Malta, Portugal, or even Thailand. So, everybody has their own niche. Malaysia in our case, besides the infrastructure, the beaches, the beautiful mountains we have; beside all these factors of consideration for this country, the most intrinsic value for which foreigners choose Malaysia is the people here: the warmth of the Malaysians. That’s what attracts them most. We welcome foreigners very well, so they always feel at home here. People settle down quickly here in Malaysia.

The idea of international living or global migration was really started in the Caribbean. If you look at what says, their top four countries for retirement are in the Caribbean. But Malaysia is ranked fifth. Here in Southeast Asia, we have completely different attributes. Indeed, every country has its own attributes. The Latin American countries are primarily catering for the US market. They even offer citizenship, which we do not. Ours is more like a residency, and people are free to come in and out of the country.

Each Malaysian state also has its own character. Kuala Lumpur, Selangor, Johor Bahru and Penang are among the popular states offering good lifestyle, where it’s easy for people to settle down, where they have good facilities and of course education centres for the children as well.

What are the key benefits of joining this programme?

Firstly, this programme offers you a ten-year multiple entry residency, and it’s renewable. Some stop at ten years, but ours is renewable. Secondly is the repatriation of income, meaning your offshore income is not taxable. You are able to purchase property here. Different states have different requirements for foreigners to purchase property. The minimum investment is generally around one million Ringgit Malaysian, but the states all differ. In Selangor, if you want to buy property, the entry-level is two million Ringgit. In Penang, it’s three million Ringgit, and in JB, it’s two million. Local banks can lend up to 60% and there are other international banks in Malaysia that lend as well, such as HSBC, or Bank of China.

It is possible to invest in local businesses, but it is not possible to have an executive role in the Malaysian company.

You are also able to obtain a Malaysian driving licence, and you can bring domestic help into the country from your own country.

Unmarried children can be sent to a private school here.

We also allow people aged over 50 to work part time in critical sectors – such as neurology and so on – for up to 20 hours – and that income is not taxable as well.