Remittances up 10% in 11 months of FY24

Staff Reporter: Remittances have increased by $1.96 billion or 10.09% in the first 11 months of the current fiscal year 2024, according to a Bangladesh Bank report.

Expatriates sent $21.37 billion in remittances in July-May of the current fiscal 2023-24, an increase from the $19.41 billion sent in the same period of FY23.

Although the Bangladesh Bank has not updated the remittance information for May on their website, central bank spokesperson Md Mezbaul Haque reported $2.25 billion in remittances received during that month, a 32% increase compared to $1.69 billion in May of FY23.

Bankers said the flow of remittances has been increasing in the last few months due to Eid-ul-Fitr and Eid-ul-Adha. In addition, the price of the dollar is rising steadily, leading to increased remittance flow as expatriates are getting more than before.

However, industry insiders also said that despite an increase in expatriates going abroad, remittance growth remains low, with flows typically spiking around festivals.

Experts attribute the low growth to the hundi market offering Tk2-3 more per dollar than official channels.

The head of the treasury department of a private bank, on condition of anonymity, told TBS that expatriates get the highest government incentive of Tk120.50-121 if they send remittances through banking channels, but hundi traders collect remittances at Tk124-125.

Underscoring the need to curb hundi, the official stated that stopping it could increase remittances through banking channels by an estimated $30 billion.

According to senior officials of several private banks, remittances have started to increase since the central bank raised the official exchange rate of the dollar by Tk7, taking it from Tk110 to Tk117. However, banks are now buying remittances for Tk118-119.

Bangladesh Bank data reveals that four months within the current fiscal year have each witnessed remittance inflows exceeding $2 billion. May, however, recorded the highest inflow at $2.25 billion, followed by February with $2.16 billion.

Data from the Bureau of Manpower, Employment and Training (BMET) indicates that 2023 witnessed the highest number of Bangladeshi citizens going abroad in the nation's history.

In that year, 13,50,000 individuals emigrated for work. Furthermore, during the first four months of the current year, 322,000 people have already secured employment abroa. 

Biniyougbarta/SAM//