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Bad year for remittance flow

  • Published at 06:37 am December 31st, 2017
Bad year for remittance flow
The remittance inflow in Bangladesh dipped in 2017, hitting a comparatively low $856 million as of September. This amount is the lowest compared to the remittance inflow of the past six years. Bangladesh Bank, on numerous occasions, expressed concerns over the decreasing flow of remittance, which is one of the main driving forces behind Bangladesh’s economy. As the issue started showing signs of improvement, the central bank is optimistic that the remittance will again increase in 2018. Addressing the issue, Executive Director of Bangladesh Bank Kazi Saidur Rahman said: “The dip in remittance flow will come down in 2018, as the central bank has taken several initiatives in this regard. Mobile banking is being regulated to curb illegal remittance.” He further said: “Within June, 2018, at the end of current Fiscal Year, the remittance flow could exceed $15 billion (Tk1,500 crore). The growth rate is improving, and it will soon reach 10%.” Adding that the price of US dollars has increased, he stated that the remittance inflow is also rising. “The bank, to serve its own needs, is trying to bring more expatriates under the coverage of legal remittance, and manpower export has also increased. The year 2018 looks promising for remittance inflow,” the Bangladesh Bank official sounded optimistic. However, the remittance in 2016-17 fiscal year was $12.77 billion, which was 14.48% lower than the previous fiscal year. The flow of remittance, however, did start to show signs of improvement towards the latter part of the year. In October this year, Bangladesh received remittance amounting to $1.15 billion, which is $303 million more than the previous month and $148 million more than the inflow in October, 2016. Bangladesh received remittance amounting to $1.21 billion in November, 2017. The remittance inflow increased by $55.7 million, compared to the month of October the same year. On the other hand, remittance inflow witnessed an increase by 10.76% from July to November of 2017-2018 fiscal year. In these five months, the country received $5.76 billion in remittance. From December 1st to 22nd, the inflow was $874 million. Speaking on the matter, former executive director of Bangladesh Bank Subhankar Saha said: “The Bangladesh Bank, the government, and the commercial banks have taken some initiatives to boost remittance. Which in turn has inspired Bangladeshis living abroad to send money to home using legal channels. “I am optimistic that the dip in remittance will not exist next year.” Meanwhile, talking to the correspondent, former director general of Bangladesh Institute of Development Studies (BIDS) said: “The inflow of remittance has improved after a curb in illegal mobile banking and an increase in the price of US dollars. Initiatives taken by the central bank is also helping this sector improve.” Earlier, Finance Minister AMA Muhith announced a number of steps to boost remittance, including withdrawal of charges. The Bangladesh Bank also took a strong stand against illegal banking. On September 14, at least 2,887 agents of mobile banking firm bKash lost their accounts for engaging in illegal remittance transactions. According to the Bangladesh Bank, in the Fiscal Year 2017-2018, the country received $1.15 billion in remittance in July, $1.41 billion in August, $856 million in September, $1.15 billion in October and $1.21 billion in November. In the Fiscal Year 2014-2015, Bangladesh achieved a record amount of remittance reaching $15.31 billion. But the inflow kept decreasing in the later years. In the Fiscal Year 2015-2016, the remittance inflow decreased by 2.5% at $14.93 billion, and in the previous fiscal year, the inflow witnessed a 14% dip at $12.77 billion, which was the lowest in the past six years. Remittance accounts for 12% of Bangladesh’s GDP. This article was first published on Bangla Tribune
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