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Bangladesh received $2.22 billion remittance in August, which is a 39.62 per cent year-on-year growth after a deadly regime change. The central bank released the data on Sunday, adding that the remittance inflow stood at $1.59 billion in August last year.
Back in June, Bangladesh saw the highest remittance inflow of $2.53 billion in recent years. However, after the quota reform movement which started from July, the remittance shutdown programme started through social media to create pressure on the Hasina government.
Such movement impacted July remittance inflow, dropping it to $1.91 billion. However, the situation changed for the better after the fall of the Hasina regime on August 5.
Expatriates were invited to send more remittance to build a new Bangladesh, and the call spread through social media. Experts believe that it created a positive impact on August remittance inflow.
Speaking to The Business Post, Bangladesh Institute of Bank Management’s (BIBM) former director general Dr Toufic Ahmad Choudhury said, “We must try to maintain this flow. The key reason behind August’s good inflow was negative publicity during the quota reform movement.
“Expatriates are now sending remittance through formal channels on their own initiative. During the movement, the remittances previously sent through informal channels are now being diverted to banking channels. Expatriates are also motivated by incentives.”
Meanwhile, floods have occurred in some districts of the country’s south-eastern region, including Cumilla, Feni, Noakhali and Chattogram. This region plays a key role in the country’s remittance inflow.
Experts say the expatriates have already started sending more remittances to their relatives as their relatives have been affected by the floods.
Echoing the same, Toufic Ahmad said, “They have started sending more remittances to their relatives in the flooded areas. I think it will have a positive impact on remittance inflow during this September as well.”
During July this year, the Chattogram division contributed $527 million in remittance, which was 27.53 per cent of the total earnings posted that month.
Meanwhile, Bangladesh Institute of International and Strategic Studies (BIISS) Research Director Dr Mahfuz Kabir said, “I would like to analyse remittances in a slightly different way. Those who did not send remittances – supporting the movement in July – did so in August.
“On the other hand, more remittances are expected to arrive than before in areas suffering from floods. If these remittances are included, the figures should have been even higher in August.”
The incumbent government has also sought more remittance from the expatriates. On August 25, Chief Advisor Muhammad Yunus raised this point in his speech to the nation.
He had said, “My appeal to all those who are abroad, please remit your earned money through official channels to the country. This money is especially needed to overcome the country's economic crisis.
“We will discuss with expatriates how to more easily and smoothly send remittance through the official channel.”
Bangladesh received the highest remittance inflow in 2021, with the figure hitting $22.07 billion. Due to the Covid-19 pandemic restrictions, hundi - an illegal cross-border transaction system – was unavailable. This is why the country saw a boom in 2021.
The remittance inflow did not decrease much in the next two years.
In 2022, the amount stood at $21.28 billion, and such amount was $21.92 billion in 2023.
During the first eight months of this year (January-August), total remittance inflow stood at $17.23 billion. The Bangladesh Bank expects that the total remittance amount would exceed $22 billion at the end of this year.
The central bank however is yet to provide any official statement about current remittance inflow.
The Business Post had reached out to the Bangladesh Bank spokesperson and Executive Director Mezbaul Haque on phone for comments on the matter, but he did not respond till the filing of this report.
The research institute Refugee and Migratory Movements Research Unit (RMMRU) had shown in a study that the potential remittances in Bangladesh should be $2 billion per month on average, which is $24 billion a year.
Experts believe that as the country is witnessing a new political environment, remittance income in Bangladesh is expected to further increase in the coming days.
Dr Mahfuz Kabir said, “Since we witnessed a crisis during the months of July and August, we have to wait for a bit to see how much remittances come through formal channels. For this reason, the Bangladesh Bank also needs to take the initiative.
“I think the rate of remittance should be a bit flexible, rather than fixed.”
