Banks asked to disburse remittance in two days

Bangladesh Bank has asked banks to disburse remittances among beneficiaries within two days of receiving it from senders abroad.

The central bank framed rules in 2014 stipulating that the disbursement must be made within two days to encourage remittance transfers through formal channels.

"It has been noticed recently that it is not being complied with," said the BB in a notice directing banks to follow the rule.

The move comes at a time when Bangladesh is facing a shortage of foreign currencies for the smooth settlement of external payments, including import bills, while remittance inflows through banking channels have declined.

However, 11.37 lakh Bangladeshis, the highest on record, went abroad for jobs in the fiscal year 2022-23, according to data from the Bureau of Manpower, Employment and Training.

Remittance earnings slipped 13.34 percent year-on-year to $4.9 billion in the July-September period of the current fiscal.

September was the third consecutive month to witness a fall in remittance inflow. Last month, migrant workers sent home $1.34 billion, down 12.7 percent year-on-year and a 41-month low.

Until October 13, migrant workers and non-resident Bangladeshis transferred $781 million through banks, showing an improvement in inflow over the previous two months.

The daily average flow of remittance was $60 million in October, up from $45 million in September, BB figures showed.

BB officials said the central bank re-issued the directive based on an analysis of data sent by banks and complaints.

"We received complaints from beneficiaries that they are not getting remittances timely. So, we have asked banks to follow the rule," said a central banker.

"Remittance flow may increase if beneficiaries get services timely."

Mohammad Ali, managing director of Pubali Bank, said remittances were usually credited to the accounts of beneficiaries instantly in banks which have already been automated.

For banks that are yet to be fully automated, he suggested connecting with the exchange houses through application interfaces to ensure real-time remittance transfers.