Remittance inflow rose by 22.54 per cent year-on-year in July-November of this fiscal year of 2019-2020 amid a sharp growth in remittance receipts in last three months due to disbursement of incentive against remittance and appreciation of the dollar against the taka.
In the five months of FY20, the country received $7.71 billion in remittance, up $1.42 billion on $6.29 billion in the same period of the previous fiscal year.
Bangladesh Bank officials said that the inflow of remittance had witnessed a significant growth recently amid the government’s move to issue 2 per cent cash incentive against the inward remittances.
The government’s move has prompted many expatriates to send money through the banking channel instead of sending through the illegal channel known as ‘hundi’, increasing the volume significantly in last couple of months, they said.
BB officials said that the transaction through the banking channel would also benefit the remittance beneficiaries to avail different other banking services.
Apart from the incentive factor, depreciation of the local currency taka has become another incentive for the expatriates.
The interbank exchange rate of a US dollar increased to Tk 84.90 on Sunday from Tk 83.9 at the beginning of January this year.
In November, remittance inflow increased by 31.75 per cent or $374.76 million year-on-year in November.
Inflow of remittance increased to $1.56 billion in November of FY20 from $1.18 billion in the same month of FY19.
In September and October, the country’s remittance inflow grew by 28.85 per cent and 32.32 per cent respectively.
In October, the inflow of remittance increased to $1.64 billion, up $400 million on $1.24 billion in the same month of FY19.
Remittance inflow rose by $328 million to $1.47 billion in September this year from $1.14 billion in the same month last year.
To encourage the expatriates for sending money through legal channel, the finance minister in the national budget for the fiscal year 2019-2020 announced the incentive.
In line with the government’s budgetary announcement, the central bank on August 6 this year issued guidelines on issuing incentive against inward remittance to encourage repatriation of earnings of the expatriates through legal channel, setting July 1, 2019 as the effective date.
Following requests from the BB, the finance ministry in October 2, three months after the budgetary announcement, released Tk 1,530 crore for six months.
Another Tk 1,530 crore out of the government’s Tk 3,060-crore budgetary allocation for FY20 to give incentive to the beneficiaries of remittances would be released later.
Meanwhile, the central bank has issued instruction to the banks for wider circulation of the information among the remittance beneficiaries especially in the country’s remote areas and abroad.
In FY19, remittance inflow hit record $16.4 billion, breaking the previous highest of $15.32 billion in FY15.
The inflow of remittance in FY19 was 9.48 per cent or $1.42 billion higher than the amount received in FY18, $14.98 billion.
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