Inward remittance downfall and remedies :
Remittance sent by Bangladeshi expatriates through legal channels has seen a sharp decline recently. The Bangladesh Bank, to revamp the remittance inflow, asked commercial banks to reduce the charges involved in sending remittance. As it turns out, it was actually the exchange houses that imposed exorbitant charges, discouraging people from sending their hard-earned money back home. Moreover, the bank USD/Taka exchange rate is below the rate in the informal channel, which encourages remittance senders to use illegal channels like Hundi instead. Hundi service providers deliver remittances to the doorsteps of the receivers, whereas the banking channel involves cumbersome procedures.
The authorities should take appropriate actions against the illegal Hundi system. Remitters must get a good rate against their currencies and be freed of cumbersome processes. Setting up remittance desks in bank branches might be a good idea.
Remittance sent by Bangladeshi expatriates through legal channels has seen a sharp decline recently. The Bangladesh Bank, to revamp the remittance inflow, asked commercial banks to reduce the charges involved in sending remittance. As it turns out, it was actually the exchange houses that imposed exorbitant charges, discouraging people from sending their hard-earned money back home. Moreover, the bank USD/Taka exchange rate is below the rate in the informal channel, which encourages remittance senders to use illegal channels like Hundi instead. Hundi service providers deliver remittances to the doorsteps of the receivers, whereas the banking channel involves cumbersome procedures.
The authorities should take appropriate actions against the illegal Hundi system. Remitters must get a good rate against their currencies and be freed of cumbersome processes. Setting up remittance desks in bank branches might be a good idea.
Mohammad Zonaed Emran
Dhaka
