The country has seen a notable surge in remittance inflows during the second week of July 2024. From July 7 to 13, expatriates sent home a significant $608.11 million, contributing to a total of $978.65 million for the first half of the month, as per Bangladesh Bank data.
This upsurge reflects a robust confidence among Bangladeshi diasporas in the countrys financial system and policies encouraging remittances through formal channels.
As per the central bank data, private commercial banks played a crucial role in surging remittance boom. Leading the surge was Islami Bank Bangladesh PLC, which received an impressive $160.38 million during the second week, bringing its total for the first two weeks of July to $299.01 million. BRAC Bank PLC and National Bank Ltd. followed, receiving $47.07 million and $41.37 million, respectively.
These banks have provided reliable and efficient uptake services, which are key factors in surging remittances. State-owned commercial banks also demonstrated strong performance. Rupali Bank PLC was the top performer in this segment, attracting $41.26 million from July 7 to 13, totaling $52.00 million for the first half of the month.
Janata Bank PLC and Agrani Bank PLC received $34.54 million and $16.62 million, respectively. These banks are crucial in serving a broad base of expatriates, many of whom use these longstanding institutions for their financial transactions.
The current surge in remittance is part of a positive trend observed over the past fiscal year. In 2023-2024 fiscal year, remittances reached an all-time high of $23.92 billion. This figure represents a significant increase compared to $21.61 billion recorded in the 2022-2023 fiscal year.
The consistent growth in remittance inflows underscores the vital role expatriates play in the Bangladeshi economy, providing much-needed foreign currency and supporting economic stability.
The governments initiatives to promote remittance through formal channels have been instrumental to achieve this growth.
Measures such as offering competitive exchange rates, reducing transaction fees, and providing incentives for using official banking channels have encouraged expatriates to remit money legally.
These efforts have helped curb use of informal channels, ensuring that more funds contribute to the national economy.
Remittances are treated as lifeline for many families in Bangladesh, supporting daily expenses, education, and healthcare. At macroeconomic level, remittance inflows bolster foreign exchange reserves, stabilize currency, and reduce the need for foreign debt.
It also plays a crucial role in poverty alleviation and rural development, as remittance-receiving households often invest in housing, small businesses, and agriculture.
The outlook for remittance inflows remains positive. The World Bank (WB) projects remittance to Bangladesh will remain robust, potentially reaching $23 billion by the end of this year. This optimism is based on continued strong performance of Bangladeshi labor force abroad and the effective policies implemented by the government to support remittance inflows.
The significant surge in remittance inflows in the second week of July 2024 highlights the crucial role of expatriates in Bangladeshs economy. With ongoing government support and favorable conditions, this positive trend is expected to continue, further strengthening the nations economic foundation, bankers say.
