Dhaka: Since the fall of the Awami League regime on August 5, 2024, Bangladesh has witnessed impressive records in remittance inflow as the current interim government has been able to restore trust and confidence among expatriates on the country's banking system. Over the last year, Bangladesh received the highest remittance for a single month and reached a historic milestone in the fiscal year 2024-25 (FY25), with remittance inflows surpassing $30 billion, breaking all previous records.
According to Bangladesh Sangbad Sangstha, expatriate Bangladeshis sent a record $30.33 billion in remittances in FY25, marking the highest amount ever received in a single fiscal year in the country's history. This figure reflects a 26.80 percent increase compared to the $23.91 billion received in the previous fiscal year (FY24). This surpasses the earlier record of $24.77 billion sent in FY2020-21. Meanwhile, Bangladesh received a record $3.29 billion in remittances in March, making it the highest remittance inflow for a single month in the country's history, surpassing the previous record of $2.64 billion in December last year.
Economists and experts observed that the government's immediate steps and campaign after the changeover in state power on August 5 last year have been encouraging expatriates to send their hard-earned money home through formal channels instead of unofficial ones. 'In fact, this is helping the inflow of remittance rise at a large scale, which is being reflected in the recent data,' said an official of the central bank.
Planning Adviser Dr. Wahiduddin Mahmud noted that the increase in remittance inflow is due to an improvement in the balance of payments, alongside a stable Taka-Dollar exchange rate. He stated that the decision to make the exchange rate market-based has not caused any difficulties, and the exchange rate has remained stable. 'We made the exchange rate market-based of our own considerations, although it was the prescription of others (IMF).the confidence on Taka has been increasing,' he added.
Dr. Mahmud further opined that the inward remittance through legal channels has been increasing because there is no speculation of an abrupt increase in the dollar price, which has reduced the tendency of expatriates to hold up remittances. Although the investment flow is not increasing to the expected level, inward remittance, especially in expatriate-prone areas, has been acting as a catalyst for the economy. 'It's compensating the stagnancy in investment to a big extent. For this, the rural economy has not become stagnant as it was expected,' he added.
General Economics Division (GED) Member of the Planning Commission Dr. Monzur Hossain commented that the inward remittance flow, alongside export earnings and the exchange rate, are in good shape. The export earnings have increased over the months, and the foreign currency reserves have also risen, indicating that the external sector is in a comparatively good condition.
Bangladesh Bank Executive Director and Spokesperson Arif Hussain Khan said that remitters now feel encouraged to send their money through formal banking channels instead of the illegal 'hundi' system, which can help boost the country's foreign exchange reserves. Riding on the growing inflow of remittances, Bangladesh's gross foreign exchange reserves rose to $30 billion by July 24, 2025, as per the traditional calculation of the central bank. However, as per the International Monetary Fund (IMF) methodology under the Balance of Payments and International Investment Position Manual (BPM6), Bangladesh's net reserves currently stand at $24.99 billion.
Apart from neutralising hundi, bankers said the prevailing stable exchange rate played a key role in alluring remitters to choose formal options to send their money back home, as the rate differential between banks and the kerb market is too small. According to market players, remitters are getting a maximum exchange rate of Taka 122.89 a dollar from the banking system, while it is Taka 125 a dollar in the kerb market.
Deputy Managing Director (DMD) of the Premier Bank PLC Abdul Quaium Chowdhury noted that the demand for hundi and hawala -- illegal cross-border money transfer channels -- has declined following a crackdown on operators after the political changeover. 'This has diverted more remittances through formal banking channels,' he added. He also mentioned that the forex market has stabilised in recent months due to higher dollar inflows driven by increased remittances.
In August 2024, remittances surged 39 percent year-on-year to $2.22 billion, while 80.28 percent in September to $2.4 billion. This momentum continued, with inflows of $2.39 billion in October, $2.19 billion in November, $2.63 billion in December, $2.18 billion in January, $2.52 billion in February, $3.29 billion in March, $2.75 billion in April, $2.97 billion in May, and $2.82 billion in June.