Bangladesh should revise its migration policies to realise its remittance potential

Bangladesh’s remittance economy has become one of the country’s most dependable economic pillars. With official remittance inflows now crossing $30 billion annually, millions of migrant workers continue to support their families, strengthen rural economies, and contribute to the country’s foreign exchange reserves.

Despite these achievements, Bangladesh has not yet reached its full remittance potential.

If the country can implement strategic reforms in migration, skill development, financial inclusion, and remittance governance, reaching $50 billion in annual formal remittance inflows within the next five to seven years is a realistic ambition.

This target, however, cannot be achieved simply by sending more workers abroad. Bangladesh must fundamentally transform its migration model—from exporting largely low-skilled labour to building a globally competitive, skilled migrant workforce.

For decades, Bangladesh’s overseas employment strategy has largely depended on low-skilled workers entering labour-intensive sectors in the Gulf and Southeast Asian countries. While these migrants deserve immense national recognition, this model has limitations.

Low-skilled workers often earn lower wages, face greater exploitation, and have limited upward mobility. Moreover, heavy dependence on a small number of labor markets leaves Bangladesh vulnerable to policy shifts, geopolitical instability, and changing workforce demands.

At the same time, a significant portion of remittances still flows through informal hundi channels, depriving the country of valuable foreign exchange reserves. Various estimates suggest that billions of dollars may remain outside formal banking systems annually.

This means Bangladesh’s challenge is not only increasing remittance volume but also maximising its formal capture.

Addressing these issues requires a shift in national priorities, starting with skill development.

The single most effective path to higher remittance is clear: skill-based migration.

A semi-skilled or highly skilled worker in Japan, South Korea, Germany, or Europe can often earn several times more than an unskilled worker in traditional labour destinations. Higher income directly translates into larger remittance potential.

Bangladesh must therefore urgently modernise its migration preparation infrastructure.

Technical Training Centres (TTCs) need curriculum reform, international certification standards, and stronger language training in English, Arabic, Japanese, Korean, and European languages. Training should align with global demand in sectors such as healthcare, caregiving, logistics, hospitality, industrial services, and modern construction.

Without this transformation, Bangladesh risks losing competitiveness in an evolving global labour market.

While skill development serves as a foundation, Bangladesh must also diversify its labour markets to ensure resilience and growth.

Bangladesh’s migrant workforce remains concentrated in a few destinations, particularly in the Gulf region.

To achieve the next remittance leap, policymakers must aggressively expand labour diplomacy toward higher-income countries experiencing demographic labour shortages, including:
• Japan
• South Korea
• Germany
• Italy
• Romania
• Poland
• Canada

These destinations offer better wages, stronger legal protections, and greater long-term income growth.

A broader migration portfolio will reduce dependency risks while significantly improving per capita remittance earnings.

Eliminating hundi remains one of Bangladesh’s biggest policy opportunities.

Competitive exchange rates, lower transfer fees, faster banking systems, mobile wallet integration, and NRB-focused financial products can significantly reduce reliance on informal channels.

Migrants must view formal banking not only as safer but also as economically beneficial.

Financial institutions should create tailored NRB products, including:
• Premium deposit schemes
• Housing finance
• SME investment support
• Insurance
• Pension products
• Diaspora bonds

Migrants should be treated not merely as remitters but as long-term economic stakeholders.

High recruitment fees and fraudulent intermediaries continue to reduce migrants’ earning power even before departure.

Government-to-government recruitment, transparent licencing, and stricter oversight of recruitment agencies are essential reforms.

High migration costs often force workers to spend months or even years repaying debts and overseas brokerage expenses before they can begin sending meaningful remittances home. Reducing migration costs would allow migrant workers to start remitting sooner and contribute more to Bangladesh’s economy through formal channels.

Global demand for female workers in nursing, caregiving, healthcare, and hospitality continues to rise. With proper training, legal safeguards, and ethical recruitment, Bangladesh can responsibly expand female workforce participation in international labour markets. This could become a major future remittance driver.

Reaching $50 billion annual remittance should not be viewed solely as a migration issue. It must be integrated into broader economic planning.
Bangladesh needs coordinated action involving:
• Government ministries
• Bangladesh Bank
• Financial institutions
• Recruiting agencies
• Technical training institutions
• Diplomatic missions

The objective should be clear: transform remittance from a survival-driven economic tool into a strategic development engine.

Bangladesh’s remittance warriors have already built a powerful economic foundation through sacrifice and resilience.

Now the nation must build on that foundation with a better strategy.

The road to $50 billion annual remittance will require:
• Skilled migration
• Market diversification
• Formalisation of informal flows
• Financial innovation
• Worker protection
• Institutional modernisation

Bangladesh’s next remittance revolution will not come simply from labour migration. It will come from skills, dignity, and strategic national vision.

*Munshi Md Ashfaqul Alam is SVP & Head of Islamic Financing & Strategic Recovery, remittance industry expert, Bangladesh Finance PLC. [email protected]

*The views expressed here are the writer's own