Bangladesh remittance grows 17.06%, expats send 1.99bn last month

The year 2023 ended with a positive trend in Bangladesh's remittance inflow, which surged by 17.06 per cent to $1.99 billion in December 2023 compared to $1.7 billion in the same month of 2022, according to the central bank data.

This surge is part of a larger upward trend in remittances, with the cumulative inflow reaching $10.79 billion from July to December in the current 2023-24 fiscal year (FY).

During the first six months of FY23, it was $10.49 billion.

Bankers attributed this surge to some flexibility in the dollar rate permitted by the Bangladesh Bank.

"Banks are making efforts to increase the flow of dollars at the end of the year. They have taken several measures to enhance remittance flow. As a result, remittances have increased," Syed Mahbubur Rahman, managing director at Mutual Trust Bank, told The Business Standard last month.

According to senior officials at several banks, the current decision of the Association of Bankers, Bangladesh (ABB) and the Bangladesh Foreign Exchange Dealers Association (Bafeda) dictates that banks will pay a maximum dollar rate of Tk109.50 for collecting remittances.

Additionally, banks can provide a 2.5% incentive from their own funds, allowing them to offer a maximum dollar rate of Tk112.24 for remittances.

However, many banks are not adhering to the dollar rate determined by the central bank through these two platforms of bank managing directors, as they are buying remittance dollars from exchange houses at a maximum rate of Tk122.

The managing director of a leading private bank said, in several incidents, the central bank has come to understand that remittance inflows decrease when banks are under too much pressure on the dollar rate of remittances.

This surge is part of a larger upward trend in remittances, with the cumulative inflow reaching $10.79 billion from July to December in the current 2023-24 financial year.

Meanwhile, the remittance earnings stood at $21.61 billion in FY23.