In a bid to encourage Bangladeshi expatriates living in various countries to send money home through legal channels, the government is going to have a special budgetary allocation for the next fiscal year. The finance ministry has already proposed keeping aside Tk 250 billion in the national budget for the coming fiscal year 2019-2020, aiming at facilitating the expatriates who would chose formal channels to remit money.
According to officials, the special allocation will be used to reduce bank charges of the expats. They may get 2 or 3 percent cash incentive on their remitted amount, the officials went on saying. Earlier, Bangladesh Bank (BB) was worried over a sliding trend in remittance inflow during fiscal years 2015-17. However, the country has made a strong comeback in recent times thanks to some good steps taken up by the government, according to BB officials.
Currently, 29 money exchange houses are operating across the globe with 1,205 drawing arrangements set up abroad to boost remittance inflow, they said. A BB official said the central bank is still working to increase remittances from across the world. Bangladesh Bank would submit a set of recommendations to the government to boost the remittance inflow up further, he informed.
Bank Asia Managing Director and CEO Md Arfan Ali told Bangladesh Post that remittance inflow decreased significantly in 2015-2016 and 2016-2017 fiscals because of oil price fall in global market side by side due to expatriate workers’ opting to remit money through informal channels like ‘hundi’. “The remittance inflow has been showing an upward trend for the last several months in the wake of a series of measures taken up by the government.”
Ali said agent banking is doing a very good job by giving door-to-door remittance service, which will encourage expatriates to send their money through formal channel. Meanwhile, the country witnessed a whopping rise in remittance inflow in the first twenty-four days of the current month. The remittance inflow increased to $1.35 billion during the period, a BB official said, expecting that this inflow would hit all-time high in single month this May.
The sharp rise in inward remittance flow can be attributed to Ramadan and Eid-ul-Fitr, the biggest religious festival in the country, as most of the country’s expatriates send money to their families to meet expenses during the holy month and for Eid, he added. Besides, strong dollar rate against the local currency has also prompted expatriates to remit additional money, he informed.
Executive Director and spokesperson of Bangladesh Bank Serajul Islam told Bangladesh Post, “Remittance inflow has recently increased as the central bank has undertaken a series of initiatives, including encouraging expatriates to send their hard-earned money through the banking channel instead of the illegal ‘hundi’ system.”
This flow will increase further on the days before the Eid festival, he expected. Bangladeshi expatriates sent home $11.65 billion in FY11, $12.84 billion in FY12, $14.46 billion in FY13, $14.23 billion in FY14, $15.31 billion in FY15, $14.93 billion in FY16, $12.77 billion in FY17 and $14.98 billion in FY18 respectively. Economist and former BB governor Dr Salehuddin Ahmed said, “Bangladeshi expatriates have sent more money through the formal channel to fulfil their families’ need ahead of Eid-ul-Fitr, which helped the remittance inflow go up.” “Now, it’s time to train up manpower for jobs abroad. This initiative will help expatriates get higher salaries and boost inflow of remittance,” he observed.