Remittance inflows hit record high at $33b in 2025

Infographics: TBS

Expatriate Bangladeshis sent home a record $32.81 billion in remittances in 2025, marking the highest-ever annual inflow and a 22% increase from the previous year.

This figure surpasses the $26.8 billion received in 2024, which itself represented a 22% increase over the year before, according to the Bangladesh Bank's monthly remittance report released today. 

The year 2025 also saw the country achieve a single-month remittance inflow of over $3 billion twice – in March and December – the first and second-highest amounts in the nation's history. Furthermore, the inflow in May of the same year was nearly $3 billion.

Md Shaheen Iqbal, head of treasury at BRAC Bank, told TBS that a primary factor behind the surge is the increased use of legal channels by expatriates. He noted that the government's continued 2.5% incentive is also encouraging remittance transfers.

He added that in the past, remittance dollars were often diverted through the hundi channel, but with that network currently inactive, the entire remittance is being channelled through the banking system. Crucially, he also observed that following the political transition on 5 August 2024, expatriates have been sending extensive remittances via banks due to a heightened sense of patriotism.

Iqbal explained that the hundi market thrives when opportunities for money laundering exist. 

"However, the current government's strict monitoring of all imports and curtailing of money laundering routes has diminished the hundi market's influence, consequently boosting remittance through formal channels."

A head of treasury at a private bank told TBS that previously, letters of credit (LCs) for imports, including consumer goods, were often opened by showing an understated value, with the remaining foreign currency paid abroad by purchasing expatriate dollars and delivering the local currency equivalent to their families. 

However, the current government is imposing stringent controls on money laundering and actively pursuing the repatriation of previously laundered funds, he said.

This official also noted that the formation of 11 joint teams to investigate irregularities, including loan fraud, tax evasion, and money laundering, concerning 10 accused business groups and the family of ousted prime minister Sheikh Hasina, has further helped in reducing the hundi market's influence.

Central bank purchases and reserves

Bangladesh Bank data shows that the central bank is actively purchasing dollars from the market due to the increased flow. Last year, it bought a total of $3.13 billion from various banks. This led to an increase in the Gross Foreign Currency Reserve to $33.19 billion as of 30 December, with the reserves under the BPM6 standard rising to $28.52 billion – the highest level in three years.

The nation's all-time record reserves stood at $48 billion in August 2021. From that peak, the reserves had continuously fallen to $20.48 billion at the time of the Awami League government's collapse. The Bangladesh Bank had sold approximately $28 billion from its reserves since mid-2021.

Bangladesh Bank Governor Ahsan H Mansur recently emphasised the vital role of remittance in stabilising the nation's economy. He expressed optimism that the remittance inflow, which surpassed the $30 billion milestone in the last fiscal year, would exceed $35 billion in the current 2025-26 fiscal year.

"Remittance has stabilised our country's Balance of Payments. As a result, the Current Account Balance has moved from a negative to a positive position. Even during the toughest period of economic crisis, remittances provided major support to the country," said the governor.

Banks leading remittance inflows

In terms of remittance collection in December of the outgoing year, state-owned Janata Bank led the way with $281 million, followed by Agrani Bank in second place with $127 million.

Among private commercial banks, Islami Bank Bangladesh collected the highest at $671 million, followed by BRAC Bank with $261 million, and Trust Bank with $216 million.

An official from Mercantile Bank's remittance division noted to TBS that banks are now sending money to accounts or MFS (mobile financial services) in real-time, which, combined with increased awareness among expatriates, is causing customers to opt for the banking channel.

He added that the current market rate for remittance dollars is between Tk122.30 and Tk122.50. With the addition of the 2.5% incentive, expatriates receive approximately Tk125 per dollar – a rate comparable to or higher than the hundi market – further encouraging the use of banking channels.