Remittance rises 7% in October, but growth slows

• Remittance rises 7 percent year-on-year
• October inflows dip from previous month
• Crackdown, rate gap boost banking channels
• Forex reserves strengthen on steady remittances

Remittance inflows to Bangladesh grew by 7 percent year-on-year in October, but the growth slowed compared to previous months.

Expatriates sent home $2.56 billion in the month, up from $2.39 billion in the same period a year earlier, according to the latest data from Bangladesh Bank.

Bangladesh has been witnessing a growing trend in remittance inflows since December last year due to multiple reasons.

These include a narrowing gap between official and informal exchange rates, and a crackdown on money laundering, industry insiders said.

However, October's inflow was 4.54 percent lower than the previous month. In September, the remittance inflow stood at $2.68 billion.

Growth in October was also weaker compared to recent months: 12 percent in September, 9 percent in August, 30 percent in July, and 11 percent in June, data showed.

Officials of the central bank said the figure reflects sustainable growth, but if the country wants higher growth in remittance earnings, it will have to increase manpower exports.

Between July and October of this fiscal year, Bangladesh received $10.14 billion in remittance, up by 13.54 percent from the same period of the previous fiscal year, data showed.

During the July-October period of fiscal year 2024-25, the remittance inflow was $8.93 billion.

Over 40 lakh people left the country for jobs abroad in the four years to the end of fiscal year 2024-25, according to the Bureau of Manpower, Employment and Training (BMET).

This migration will push up remittance earnings in the coming days, according to industry insiders.

They also said that since irregular or alternative payment methods are now being controlled, the demand for US dollars has declined, which has caused a drop in foreign currency inflows through hundi or informal channels.

That is why remittance inflows through banking channels are growing, they added.

In fiscal year 2024-25, remittance inflows crossed $30 billion for the first time and rose by a record $6.4 billion.

Prior to this, the highest volume of remittance received by Bangladesh was $24.8 billion in fiscal year 2020-21.

Now the country's foreign exchange reserves are in a stable situation due to various reasons, including high remittance inflows.

As of October 30 this year, the forex reserves stood at $27.54 billion, up from $19.87 billion in the same period last year, BB data showed.

Bankers said the growing trend of remittance inflows has helped boost the forex reserves.