Bangladesh receives $28b in remittance in 11 months
With Eid-ul-Azha approaching, expatriates have sent $604 million in remittance in the first three days of the current month alone.
At an exchange rate of Tk 123 per dollar, this amounts to approximately Tk 74.29 billion.
As a result, in nearly 11 months of the current fiscal year (July–May), total remittance inflow has reached $28.11 billion. During the same period in the previous fiscal year, the figure was $21.65 billion.
Bangladesh’s foreign currency reserves rise to $26 billion on strong remittance growth.
According to sources at the Bangladesh Bank, a strong rise in remittances has boosted the central bank’s foreign currency reserves, which now stand at $26.06 billion. Under the IMF’s BPM6 accounting system, the reserve is recorded at $20.76 billion.
In May, expatriate Bangladeshis sent $2.97 billion in remittances—an increase of 31.7 per cent compared to the same period last year. In March, during Eid-ul-Fitr, remittances peaked at $3.29 billion. However, the following month in April, the amount declined to $2.75 billion. Despite this fluctuation, the overall growth trend in remittance has remained strong.
Banking sector officials say that the robust growth in remittances is having a positive impact on the country’s foreign exchange reserves and helping ease pressure on the US dollar.
Strict government actions against illegal money transfers and incentives for sending remittances through formal channels have played a major role in this increase.
It is common for expatriates to send more money home ahead of major religious festivals like Eid-ul-Fitr and Eid-ul-Azha so their families can celebrate the holidays with joy. In line with this pattern, banks expect a significant inflow of remittances ahead of the upcoming Eid-ul-Azha.
Officials from the banking sector note that the dollar crisis that had affected banks is easing thanks to the rise in remittances. They also report that volatility in dollar exchange rates has somewhat stabilised. Banks are now purchasing remittances at the central bank’s set maximum rate of Tk 123 per dollar, while in the open market, the rate stands at Tk 125.
Following the political shift brought on by the mass uprising in August last year, expatriates have consistently sent over $2 billion each month for the past seven months. In February, remittances reached around $2.53 billion, a 17 per cent increase compared to the same month the previous year.
In January, remittance inflow was 3 per cent higher than the previous year.
Remittances are the only debt-free source of US dollars for the country, as they do not require any corresponding outflow of foreign currency or repayment. In contrast, export earnings bring in dollars, but also require spending on raw materials and machinery imports. Moreover, foreign debt repayments also demand US dollars. Overall, when remittance inflows rise, the central bank’s foreign currency reserves tend to grow rapidly.