Meraj Mavis: Remittance continued to dip for the third consecutive month in August, with seemingly no respite in the coming days.
Remittance inflow declined 8% year-on-year in August to $1.8 billion, the lowest in the past six months.
At the same time, the remittance in August decreased by about 3.25% compared to July, the first month of the fiscal year.
According to the Bangladesh Bank data, remittances sent by expatriates to the tune of $1,810 million in August, equivalent to Tk15,385 crore (if a dollar cost Tk85.)
The figure of $1.8 billion is lower than August 2020, when it was $1.96 billion.
Apart from this, compared to the first month of the current FY 2021-22 July, the remittance has decreased by about 3.25% in August. In July, the expatriates sent $1.87 billion, equivalent to Tk15,900 crore.
In June earlier this year, the last month of the last fiscal year, expatriates sent $1.94 billion, or Tk16,000 crore.
In other words, remittances for June were $693 million less than the previous month and about 28% less than the same month of the last year.
As a result, those concerned fear that the income will decrease further.
Syed Mahbubur Rahman, managing director and CEO at Mutual Trust Bank, said: “We have to wait a few months more to find the reasons behind it.”
He suspected that hundi, a form of illegal money transfer, may be on the rise again, which remitters may be using more than the banking channels.
The central bank had earlier taken a series of measures to encourage the expatriate Bangladeshis to send their hard-earned money through formal banking channels, instead of the illegal ‘hundi’ conduit, which can help boost the country’s foreign-exchange reserves.
At present, the government gives an additional 2% incentive when remittances or expatriate income comes through the banking channel. In addition, many banks offer an additional 1% incentive.
Remittance is the second-highest forex-earner for Bangladesh after readymade garments.
A steady inflow of foreign currencies even during the coronavirus onslaught-when exports faced a setback–had raised the country’s foreign-exchange reserves over $48 billion recently.
In the outgoing FY 2020-21, the total remittance in the country is about $24.78 billion, which is more than Tk2 lakh crore. This income is 36% more than the $18.03 billion in FY 2019-20.
Currently, 29 exchange houses are operating across the globe, setting up more than 1,450 drawing arrangements abroad, to expedite the remittance inflow, according to the central banker.