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Bangladesh has set a new record in remittance earnings, reaching an all-time high of $2.749 billion in just 24 days of March, with two more banking days remaining.
According to Bangladesh Bank data, which compiles figures from all banks, this is the highest-ever monthly remittance inflow through legal channels.
The previous record was $2.639 billion, set in December 2024.
People familiar with the development at the central bank told FE that the surge is primarily driven by remittances ahead of the Eid festival.
However, they pointed to several other factors contributing to the achievement.
Central bankers said that the informal money transfer system, commonly known as "hundi," is rapidly disappearing.
They linked the rise in formal remittance inflows to recent political changes, suggesting that some individuals previously engaged in "crony capitalism" have left the country.
"To my mind, the absence of crony capitalists is boosting remittance inflows through formal channels," said a senior banker.
"In the past, these individuals used banks to siphon off funds."
Crony capitalists refer to individuals with close ties to political power who have benefited from preferential treatment in financial transactions.
Central bankers highlighted the role of mobile financial services and new technologies in facilitating remittance inflows.
The increase in remittances has significant implications for Bangladesh's economy, helping to stabilize foreign exchange reserves and support the forex market.
The foreign exchange reserve as of Monday was recorded at $20.01 billion as per the BPM6 measure.
BPM6 refers to the International Monetary Fund's (IMF) Balance of Payments and International Investment Position Manual, sixth edition, released in 2009.
It provides a framework for compiling and presenting consistent and timely balance of payments and international investment position statistics.
jasimharoon@yahoo.com