Raise remittance incentive from 2.5% to 4%, experts urge govt

Highlights

• Experts suggest increasing the remittance incentive to 4%
• Migrants contributed $27 billion last year
• Calls to curb illegal channels and boost formal transfers
• Emphasis on sending skilled migrants abroad
• Better embassy and bank services urged

Experts and stakeholders have proposed raising the remittance incentive from the current 2.5% to 4% to encourage overseas workers to send money through legal channels.

The proposal was presented at a seminar titled "Measures to Increase Remittance Income," held today (18 January) in the capital.

Hassan Ahmed Chowdhury Kiran, chairman of Debate for Democracy, presented the keynote presentation at the seminar.

Kiran emphasised that the government and banks need to be more proactive in promoting legal remittance transfers. He suggested that banks should adopt special measures, such as going directly to the workplaces of workers, similar to how money changers (hundi operators) work, to collect funds. Additionally, using mobile banking for easy transfers to recipients should be encouraged.

"I recommend increasing the government incentive on remittances from 2.5% to 4%. This would motivate overseas workers to send money through legal channels," he said.

He further stated that overseas workers sent $27 billion back to the country in the past year, and that 25% of the country's workforce is employed through migration. Without foreign employment, the number of impoverished people in Bangladesh would have increased by another 10%.

In her speech as the chief guest, Dr Fahmida Khatun, executive director of the Centre for Policy Dialogue (CPD), highlighted the need to provide incentives for remittance earners, stop the practice of hundi, and focus on sending skilled workers abroad.

She said, "Compared to other countries, the volume of hundi is much higher in our country. Measures need to be taken to stop it. If the incentives for remittance earners are increased, they will be more encouraged to send money through legal channels."

"The proposal to raise the incentive from the current 2.5% to 4% should be considered," she said.

She added, "Foreign embassies and banks must be more dedicated to serving expatriates. We need to understand if the food provided in the expatriate lounge at the airport, like burgers, aligns with their preferences. Migrants are like golden assets; they need to be properly cared for and shown due respect."

She further said, "Currently, most of our migrant workers are unskilled. If we prioritise sending more skilled workers abroad, remittances will increase."

At the conclusion of the seminar, the champions of the International Migrants Day 2024 Debate Competition, Sher-e-Bangla Agricultural University, and the runners-up, Begum Rokeya Government Women's College, were awarded cash prizes, trophies, crests, and certificates.