In Bangladesh, August remittance fallen by 21.5%; steepest decline in recent years:

According to Bangladesh Bank’s latest data, remittance inflow declined by 21.47 per cent to $1.59 billion in August compared with that of $2.03 billion in the same month in the previous year.

This is the steepest decline since the peak of the pandemic in 2020, which signals yet another blow to Bangladesh’s dwindling forex reserves.

The August figure was also lower than the previous month’s remittance earnings of $1.97 billion.

According to Bankers, despite more Bangladeshi leaving for jobs abroad, remittance is declining persistently due to the growing use of unofficial channels like hundi; this trend will create trouble for Bangladesh economy.

Bankers are of the view that an instability on the foreign exchange market leads to popularity of informal channels for sending remittances.

The Bangladesh Bank’s official exchange rate for US dollar is Taka 109.5 while in the kerb market dollar rate is Taka 117-118. This vast difference promotes illegal channels like Hundi for remittance transfer which is creating a forex crisis in Bangladesh.

Experts are of the view that instead of wasting energy on chasing hundi operators, the authorities should acknowledge that the taka’s artificial overvaluation is the primary reason for this situation.