Bangladesh receives record $2.64b remittance in December
Highlights:
- Record $2.64 billion received in remittances in December 2024
- Previous highest $2.59 billion received in July 2020
- Nearly $27 billion received in 2024, reflecting a 22% year-on-year increase
- Demand for hundi decrease due to reduced money laundering
Bangladesh received a record $2.64 billion in remittances in December last year, making it the highest remittance inflow for a single month in the country's history.
The previous high of $2.59 billion was received in July 2020 during the Covid-19 period.
According to the central bank, remittance increased by 32.66% in December 2024 compared to the same month a year before.
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During the first half of FY25 (July-December), the country received $13.78 billion in remittances, a 27.59% rise from $10.8 billion during the same period last year.
Speaking to The Business Standard about the high remittance inflow, Husne Ara Shikha, executive director and spokesperson of the Bangladesh Bank, said the narrowing gap between the dollar rates in formal and informal channels – down to nearly Tk1 due to a rise in the official dollar rate – has incentivised remitters to use legal avenues.
Moreover, as demand for hundi – an informal cross-border money transfer system that bypasses the legal banking channels – has decreased in recent months due to reduced money laundering, a significant portion of remittances that were previously channelled through hundi (in hopes for higher dollar rates) is now coming through formal channels, she added.
"Overall, we consider the growth in remittances to be positive, and we expect an even better inflow next year," the BB spokesperson said.
Bangladesh received nearly $27 billion in remittances in 2024 – reflecting a 22% year-on-year increase – bolstered by a 9% rise in the official dollar rate and a decline in money laundering during the final five months.
Senior officials at several banks told TBS that the remittance market is highly sensitive to exchange rates. When the dollar rate rises, remittance inflows tend to increase.
After the interim government took office in August, the rate was increased to Tk120. By December, the dollar rate rose to Tk128, but the central bank's verbal instructions capped transactions at Tk123. This represents an increase of at least Tk10 or 9%.
According to bankers, this upward trend in the dollar rate has contributed to the rise in remittances.
Islamic Bank leads in remittance inflows
According to central bank data, in December last year, Islami Bank received the highest remittance among the country's banks, amounting to $366 million. Agrani Bank secured the second position with $266 million, while Sonali Bank came third with $212 million. Several other banks, including BRAC, Janata, Krishi, National, NCC, and Trust, received over $100 million each.
The central bank said state-owned and specialised banks received $833 million in remittance, while private banks collected $1.8 billion.
