Remittance: 3 Bangladeshi banks in trouble as Singaporean bank suspends cash receipt

Half of the Bangladeshi expatriates working in Singapore deposit their remittances in cash. These funds are first deposited with remittance houses, then channelled through local banks to Bangladesh.

However, DBS Bank in Singapore has recently announced it will no longer accept cash remittances, a decision which has raised fears of a paralysis in formal remittance inflows from Singapore.

This has put three Bangladeshi banks operating there in serious difficulty.

Bangladesh Bank, however, intervened immediately to keep official channels functioning. Following its request, DBS agreed to continue accepting cash deposits until 31 October.

The bank cited anti–money laundering compliance as the reason behind its move. The Association of Bankers, Bangladesh (ABB) has urged that the matter be addressed without delay.

Agrani Bank, National Bank and Prime Bank have been providing remittance services in Singapore since 2006. At one time, their accounts were maintained with Standard Chartered, UOB and OCBC banks. But those ties were severed four years ago, amid allegations of money laundering, heavy reliance on cash, and compliance failures. The three Bangladeshi banks now rely solely on DBS for settlement.

Agrani Bank operates five branches in Singapore, while National and Prime Bank each run three each. These branches not only handle remittances but also offer deposit and other banking services.

A large section of Bangladeshi workers in Singapore depend on these branches to send their earnings home.

In early August, DBS notified several remittance houses that it would no longer accept cash remittances. The three Bangladeshi banks quickly informed this Bangladesh Bank, which then urged DBS to extend the arrangement. DBS subsequently agreed to continue until 31 October.

Roughly half of all remittances sent from Singapore are deposited in cash. These deposits are placed with DBS by remittance houses, from where they are channelled to Bangladesh.

Should cash deposits be stopped entirely, remittance houses may still receive money but would be unable to transmit it through banking channels. This could drive a surge in illegal hundi transactions.

Shahidul Islam Azad, CEO of NBL Money Transfer in Singapore, warned, “If cash acceptance is suddenly stopped, a major crisis will unfold. Those earnings could be sent through illegal channels. Migrant workers need time to adjust to digital transfers.”

According to Bangladesh Bank data, remittances from Singapore amounted to USD 385.2 million (38.52 crore) in FY 2021–22, rising to USD 423.3 million (42.33 crore) in FY 2022–23.

In FY 2024–25, monthly inflows were USD 42.7 million (4.27 crore) in July, USD 26.9 million (2.69 crore) in August, USD 24.6 million (2.46 crore) in September, USD 42.2 million (4.22 crore) in October, USD 44.7 million (4.47 crore) in November, USD 60.4 million (6.07 crore) in December, USD 71.6 million (7.16 crore) in January, USD 73 million (7.3 crore) in February, USD 47.4 million (4.74 crore) in March and USD 50.9 million (5.09 crore) in April.

Islami Bank also receives remittances from Singapore via Mustafa Foreign Exchange.

Singapore has been among the top five destinations for Bangladeshi migrant workers for the last few years. Most are employed in construction and shipbuilding. The country recruits only skilled workers.

According to the Bureau of Manpower, Employment and Training (BMET), as many as 64,383 workers went to Singapore in 2022, some 53,265 in 2023 and 58,878 in 2024.

Between January and May this year, some 26,389 workers left for Singapore. From 2004 to May this year, a total of 919,159 Bangladeshis migrated to the country.

Former ABB chairman Anis A Khan said, “Digital transfers are essential for curbing money laundering. Cash transactions are also already declining in Singapore.”

Pointing out that the Bangladeshi workers in Singapore earn little and often receive their wages in cash, he said, “If cash remittance is stopped, they will face enormous difficulties, and the risk of illegal hundi will increase.”

Anis A Khan urged the authorities to urgently focus their attention on the matter.