Remittance inflow dropped by 10.84 per cent to $1.53 billion in September, the third month of the current financial year 2022-2023, from $1.72 billion in the same month of the past financial year.
The inflow of remittance in September was the lowest after February 2022 when it was at $1.49 billion.
The remittance inflow in September is 24.63 per cent lower than the inflow in August as the expatriates sent home $2.03 billion remittance through the banking channel in August.
In the first quarter (July-September) of the financial year 2022-23, the expatriates sent total $5.67 billion while they sent $5.4 billion in the same period in FY22, according to the Bangladesh Bank data released on Sunday.
The remittance inflow was over $2 billion in July and August.
Businesses are grappling with the dollar crisis and they are failing to settle LC payments due to the shortage of foreign currency, BB officials said.
The decline in remittance inflow is a concern for the country which is mostly dependent on imports.
The country’s trade deficit reached a record high of $33.25 billion in FY22 from $23.78 billion in the previous financial year.
The government and the Bangladesh Bank have also taken various measures to prevent inflow of remittance through informal channels, but the efforts are yet to be successful on a large scale, the BB officials said.
The inflow of remittance declined despite the fact that the government increased cash incentive for remittance.
On January 1, the government increased cash incentive on remittance to 2.5 per cent from 2 per cent to encourage migrants to send more money through the formal channel.
Considering the dollar shortage on the market, the Bangladesh Bank has recently issued a circular saying that the expatriates do not require to show documents for sending any amount of money to the country.
The central bank on September 14 approved floating rate of dollar that raised the ceiling for collecting remittance to Tk 108.
The interbank exchange rate of the US dollar is ranging at Tk 103-5.
Bankers said that the benefits of the raising dollar rate could be seen in the coming months.
The economy of the country has been struggling for a number of reasons, including rising inflation, record trade deficit, energy crisis, decline in reserve and currency volatility.
The foreign exchange reserve fell to around $36.44 billion on September 28 from $48 billion in the previous year.
In FY22, the inflow dropped to $21.03 billion from $24.78 billion in the previous financial year 2020-2021 that created a panic on the financial market.
In September, six state-owned bank received $246.26 million inward remittance, two specialised banks received $24.13 million, and 41 private commercial banks received $1,262.95 million while nine foreign commercial banks received $6.15 million, according to the BB data.
Of the banks, Islami Bank Bangladesh received the highest, $333.99 million, followed by the City Bank $112.82 million, Al-Arafah Islami Bank $107.17 million and Agrani Bank $95.58 million.
In FY19 and FY20, the inflow of remittance was $16.42 billion and $18.21 billion respectively.
