August remittance inflow up 8.9% YoY, yet hits seven-month low
Despite the year-on-year growth, the August figure marked the lowest monthly inflow in seven months, with the last lowest amount being $2.19 billion in January
Remittance inflows to Bangladesh in August totalled $2.42 billion, a significant 8.9% year-on-year increase from the $2.22 billion, according to the latest data from the Bangladesh Bank.
Despite the year-on-year growth, the August figure marked the lowest monthly inflow in seven months, with the last lowest amount being $2.19 billion in January.
Cumulative inflows for the first two months of the 2025-26 fiscal year, from 1 July to 31 August, totalled $4.9 billion, a substantial 18.4% year-on-year increase from the $4.14 billion.
Banking officials attribute the positive trend to a steady flow of funds from Bangladeshi workers abroad.
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Syed Mahbubur Rahman, managing director of Mutual Trust Bank, suggested that the overall growth reflects a decrease in the demand for illicit money transfers, a practice also known as "hundi."
"We are currently receiving an average of $2.5 billion in remittances every month," he told TBS. "The year-on-year growth we are seeing is largely a reflection of a decrease in the demand for illicit money transfers."
He noted that months with inflows approaching $3 billion typically coincide with religious festivals such as Eid-ul-Fitr and Eid-ul-Adha. In recent months, however, persistently high inflation in host countries may have dampened remittance flows.
At present, banks are purchasing remittances at rates between Tk121.50 and Tk121.70 per dollar, with an additional 2.5% government incentive. The open market rate is now almost on par with official banking channels.
To stabilise the exchange rate and support remittance and export flows, the Bangladesh Bank purchased $149.5 million from commercial banks on 28 August.
Since initiating dollar purchases through auctions on 13 July – when it acquired $171 million at Tk121.50 – the Bangladesh Bank has purchased more than $800 million in total.
A deputy managing director of a leading private bank said a year of robust remittance and export earnings has enabled banks to clear overdue import bills, particularly for fuel. With import pressure easing, the supply of dollars is currently outpacing demand, putting downward pressure on the exchange rate.
"The central bank's intervention is aimed at maintaining the rate within a Tk121.50 to Tk122.50 range," he added.
Islami Bank leads in remittance earnings
Among individual banks, Islami Bank Bangladesh received the highest remittances in August at over $550 million, followed by Krishi Bank (over $250 million), Agrani Bank (over $180 million), BRAC Bank (over $150 million), Janata Bank (over $150 million), and Trust Bank (over $130 million).
