The country could receive as much as $30 billion in remittance annually if proactive steps are taken by the government and other stakeholders, including the banking sector, speakers said at a dialogue yesterday.
They said the use of formal channels to remit money home was still not at the level. The channel also lacked the required "speed" to encourage more remitters to use it and the speakers suggested that further government incentives could encourage them to use the formal channel.
Citizen's Platform for SDGs, Bangladesh, organised the virtual dialogue titled "Recent Expatriate Income or Remittance Inflow: Where is the money coming from?"
Bangladeshi expatriates sent home $21.75 billion in remittance last year, according to Bureau of Manpower, Employment and Training data, which cites Bangladesh Bank statistics.
The amount is a record high and it also defied predictions made at the onset of the global economic fallout of the coronavirus pandemic.
Addressing the dialogue, Anisul Islam Mahmud, chairman of the parliamentary committee on expatriates' welfare and overseas employment ministry, said it is possible that the country will receive $30 billion in remittance every year in the future.
"The money is there," he said, adding that yearly remittance inflow is yet to hit the $30 billion mark because such money is still not coming through the formal channels.
The banking sector was yet to provide services with sufficient "speed", which the non-formal sector ensures, he said.
He added that the government's two percent cash incentive was a reason for the increase in recent remittance inflow and suggested it would be sustainable with a further increase in the incentive.
Syed Saiful Haque, chairman of Welfare Association for the Rights of Bangladeshi Emigrants (WARBE) Development Foundation, said it is not surprising that the country received about $20 billion remittance in a year.
He referred to a study of the Bangladesh Enterprise Institute, conducted about a decade ago, and said the study then revealed that it was possible to get about $30 billion in remittance annually.
If the government and other stakeholders, including the banking sector, work proactively, then it is most likely that inward remittance will continue to surge, he added.
Saiful also suggested that "visa-trading" be stopped in this regard through bilateral initiatives, adding that about $3 billion to $4 billion was spent for "visa purchasing" every year.
Syed Mahbubur Rahman, managing director and chief executive officer of Mutual Trust Bank, said in the case of remitting money, "speed" and "trust" are important because those who remit money look at how quickly, especially in cases of emergency, the money reached their dear ones back home.
He said the government recently re-determined the maximum time limit to distribute remittance to the beneficiary in two working days, which was 72 hours earlier.
Such steps are largely being implemented at present and this has helped in the increase of remittance inflow, he said.
Chairing and moderating the dialogue, Dr Debapriya Bhattacharya, convener of the citizen's platform and distinguished fellow of Centre of Policy Dialogue (CPD), said although there were various reasons behind the recent inward remittance increase, there is no doubt that the government's two percent cash incentive was a key reason.
Remittance kept coming in large amounts, but even greater amount of expatriates' earnings may have been involved in different market-oriented sectors, he said.
Whether such money was inflowing through a "third channel" instead of reaching the beneficiaries directly from the wage-earners is a matter to look into, Debapriya added.
Addressing the dialogue, CPD Chairman and eminent economist Prof Rehman Sobhan said although the government's two percent cash incentive for inward remittance was a positive step, the macro beneficiary of it is the "balance of payment" of the country.
The diversion from hundi to here was essentially a macro issue because households were continuing to get the same amount that they were getting in the past, he said.
"So, we have now added to our foreign exchange reserves and improved official balance of payments," he added.
He said the problem that should essentially be addressed is the about one crore people who, going abroad after 45 years, are still "disempowered individuals" and at "the mercy of the market".
CPD Distinguished Fellow Prof Mustafizur Rahman, founding chair of Refugee and Migratory Movements Research Unit Prof Tasneem Siddiqui, and Centre for Non Resident Bangladeshis Chairperson MS Shekil Chowdhury, among others, addressed the virtual dialogue.