Remittance inflow to Bangladesh soared by more than 80 per cent in September compared with that in the same month of the previous year, as expatriates sent more money through formal channels following major political shift in the country.

According to Bangladesh Bank data, the remittance inflow rose to $2.40 billion in September compared with that of $1.33 billion in the same month in 2023

The inflow was $2.22 billion in August 2024.

The remittance inflow slowed in July due to countrywide protest over quota reforms, which eventually led to civil movement.

However, it began to rise after Sheikh Hasina resigned as prime minister and fled to India on August 5 amid the student-led mass uprising.

Nobel laureate Muhammad Yunus took office as the head of Bangladesh’s interim government on August 8.

Bankers said that the sudden fall of Sheikh Hasina prevented many individuals associated with the Awami League-led administration from fleeing abroad, which helped curb the exodus of large sums of dollars.

Remittance inflow through Islami Bank Bangladesh was highest, which was Tk 402 crore, followed by Agrani Bank Tk 322 crore, Trust Bank Tk 245 crore, Rupali Bank Tk 113 crore, Bangladesh Krishi Bank Tk 109 crore, Janata Bank Tk 106 crore and City Bank Tk 101 crore in September.

The country’s foreign currency reserves, according to the International Monetary Fund guidelines, dropped to $19.56 billion on August 25.

The interbank dollar rate increased to Tk 120 each after a rise of Tk 7 on May 8.

Considering government incentive alongside the formal rate of Tk 120, the expatriates found it more lucrative through formal channel than informal channel as the price on the kerb market was around Tk 121 each.

The high rates attracted expatriates to use formal channels for money transfers, avoiding illegal channels like hundi.

The remittance inflow reached $23.9 billion in FY24, up from $21.6 billion in FY23.

The government and the central bank have taken various measures to increase remittance inflow through formal channels, BB officials said.

On January 1, 2022, the government increased cash incentive on remittances to 2.5 per cent from 2 per cent to encourage migrants to send more money through the banking channel.

Taking the dollar shortage into consideration, the Bangladesh Bank has issued a circular saying that expatriates would not have to show documents to send any amount of money to the country.