Remittance receivers to get incentive in arrears

Staff Correspondent | Published at 12:00am on September 09, 2019

The beneficiaries of inward remittances would get cash incentive in arrears as the government is yet to start providing the benefit for which the beneficiaries became entitled since July 1 this year.

In the fiscal budget for the year 2019-2020, the government announced to issue 2 per cent cash incentive to the beneficiaries of inward remittances.

Officials of the central bank told New Age that the banks would be allowed to issue the incentive in arrears to the beneficiaries of inward remittances upon submission of proof by the beneficiaries.

To start disseminating the incentive, the BB has requested the government to release fund for providing the cash incentive against the inward remittance of the Bangladeshi expatriates.

The central bank, however, would take legal action if any sort of irregularities in issuing such benefit is found.

The BB in mid-August this year had requested the government to release fund for providing the incentive.

In line with the government’s budgetary announcement, the BB has already issued guidelines in this regard, stating that no document would be required for receiving the incentive against remittance worth up to $1,500.

The BB guidelines mentioned that the incentive would come into effect from July 1, 2019, creating the scope for getting it in arrears against the inward remittance.

It said that the banks would get three-month fund allocation from the central bank based on the average monthly repatriation of remittance through the banks in the preceding year.

If the allocated fund exhausts in three months, banks would continue giving the incentive and would adjust the amount later with the government’s allocation, it said.

Officials of the banks said that they had been making preparations in this regard and expected that the procedure could be started after receiving money from the central bank.

The government in the budget for the fiscal year 2019-2020 allocated Tk 3,060 crore for providing the incentive in an expectation that the incentive would significantly increase the remittance flow through the legal channels and discourage the illegal channels like ‘hundi’ business.

In FY 2005-06, the country’s remittance earnings were $4.9 billion, which grew by three times to reach $16.4 billion in FY19.