WELCOME TO MY

PRESENTATION
TOPIC : Foreign Remittance in Bangladesh

My self : Imran Iqbal

ID: 101011087
Department : BBA
 INTRODUCTION
 Remittance: Remittance means the transfer of money by a foreign worker to his or her
home country or the transfer of any kind of funds across national boundaries.

 Background of the Report: One of the main sources of our national income is
foreign remittance. Foreign remittance is now become a significant issue in our present
economy.

 Objective of the Report: My major objective is To have an overall idea about the
performance of remittance in Bangladesh last 4-5 years.

 Methodology of the Report: Mainly I have collected data from one source which is
secondary data.

 Limitation of the report: I also faced some limitations or obstacles in the way of
completed my internship program.
 Historical Perspective
 Bangladesh has a long history of overseas remittances and migration. In 1942

Bangladeshi nationals had migrated to the port cities of London and Liverpool in the UK.
The British had a scheme of issuance of employment voucher to overseas workers seeking
work abroad. During the British Ruling time the scheme had opened up a great
opportunity for Bangladeshi workers to migrate to United Kingdom (UK). It is believed
that thousands of Bangladeshis, especially from Sylhet, took the first opportunity and
created a flow of migration towards UK.

 Definition of Remittance: In point of view in banking, remittance means

transfer of fund one place to another. When money transferred from one country to
another, this is called Foreign Remittance. Transfer of Capital, usually from a buyer to a
distant seller or the instrument of transfer such as a check or draft.
 Classification, Channel & Uses of
Foreign Remittance:
 Classification : Foreign remittance may be classified into two types:
 Inward Remittance : ( Spot Cash, FTT, FDD, TC )

 Outward Remittance : ( FTT, FDD, TC )

 Channel of foreign remittance:

 Official Channel: ( Telegraphic transfer, Western union, Demand draft, Postal order,
etc)
 Unofficial channel: (Hundi system, Relatives and friends etc )

 Uses of Remittance: In our country most of the people use a big portion to their
remittance in Home construction / Repair above 15 %. Just we can see At a glance where
& how much remittance they can uses in different sectors.
 Utilization pattern of Remittance
Home construction / Repair
Uses pattern of Remittance:
Purchase of Agricultural land

Repayment of loan for Migration

4% 20% Gift & Social ceremonies

1% 1% 0%1% 0%
3%
4% 3% Sending family member abroad
1%
1% Investment in Share market & business
5% Repayment of loan other purposes

Saving or Fixed deposit

Child education
6% 15%
Release of mortgage land

Taking mortgage of land

Homestead land purchase

9% Gift or Donation to relatives

12%
14%
Send relative for pilgrimage

Furniture

Insurance

Community development activities

Others
 Last 5 years Performance of Remittance in flows

Year Remittance (In million US

Dollar)
2012-13 14461.14
2011-12 12843.43
2010-11 11650.32
2009-10 10987.40
2008-09 9689.26

 In FY 2012-13, the rate of growth in remittance was 12% which was 1.76% more than

that of FY 2011-12. Bangladesh received US$ 14.5 billion remittance which is highest
ever in 2013. In FY 2012-13, Bangladesh received remittances of 14461.14 million which
was 1617.71 million more than that of FY 2011-12.
Remittance Inflow: ( from 2013 to 2009 ) in million

9689.26 Year 2008-09

14461.14
Year 2009-10

10987.4 Year 2010-11

12843.43 Year 2011-12

Year 2012-13
11650.32
 Country-wise remittance inflows
 The remittance earned in 2013 was amounted to US$ 14.50 billion. KSA tops the list

comprising (US$ 3.82b) of the total. KSA occupies the ever 1st position in regard to
remittance flow to Bangladesh till 1976. UAE stands at 2nd position possessing (US$
2.82b). The United States and the United Kingdom do not host many Bangladeshi short-
term workers in cumulative counting, but they hold the 3rd 1.85b) and 6th position (US$
0.991 b) respectively highlighting the role of permanent migrants in remittance transfers.
The cumulative figure of remittances from Kuwait constitutes 4th (US$ 1.18 b). Malaysia
scores the 5th position (US$ 0.997b). In 2011, the migration from Bangladesh is very
negligible to the KSA, Kuwait and Malaysia, but the position of remittance sending are
1st , 4th and 5th respectively, which indicates that the remittance flow depends on the
aggregate numbers of migrants. Next positions are occupied by Oman 7th (US$ 0.61b),
Singapore 8th (US$ 0.49 b), Bahrain 9th (US$ .36 b), and Qatar 10th (US$ 0.28b).
Country Position wise flow of remittance
2012-13
US$ In Billion KSA

UAE
0.28 3.82
0.99 0.61 0.49 0.36 USA

KUWAIT
1 MALAYSIA

U.K

OMAN
1.18
1.85 2.82 SINGAPORE

BAHRAIN

QATAR
 Overseas Employment of Bangladesh
LAST 5 YEARS
Year Number of Employee
2009 475,278
2010 390,702
2011 568,062
2012 607,798
2013 371,647

 Year 1976 to 2013 around 8.6 million Bangladeshi migrants are working in different

countries of the world. Starting with the number of 6087 in 1976, now it reached at
371,647 in 2013.
 Overseas Employment of Bangladesh
 Worth of overseas employment: Remittances from Bangladeshi migrants have
contributed a bigger portion of the country’s development budget than foreign aid.
Successful migration can be established through safe and profitable stay at workplace. It has
become an added advantage for poverty aid. Migration and the remittances from manpower
export have established a great development of Bangladesh economy.

 Future prospect of overseas employment: Demand for Bangladeshi

workers is day by day increased because Bangladeshi workers are work hard and took
reasonable wages for their work. Bangladeshi workers are governing mostly in the middle-
eastern and south-eastern countries. European and Nordic countries also feel the shortage
of appropriate hands for baby care, old age care, sick persons care, etc. So I can easily say
that if government should take proper steps for the wage earner workers training and fulfill
their other basic needs may be they will more contributed to our country.
 Impact on the Economy of Bangladesh
 In Bangladesh, Remittances shows a positive sign on the social and economic indicators
like : social security, nutrition, investment activities, education, living condition, health
care and poverty reduction. Now Bangladesh has been able to avoid any imbalances in
BOP current account. Bangladesh is continuously contributing to the achievement of the
Millennium Development Goals. Remittance is playing an effective role in development of
Bangladesh economy through the following outcomes:
 Poverty alleviation.

 Increased purchasing capacity.

 Meet import financing.

 Sustain balance of payment.

 Findings & Analysis
 Most of the time migrants workers are used informal channel like Hundi.

 Not only the Middle East country, but also expand other areas of manpower export.

 Language barrier is a major problem to fulfill the formalities in sending the

remittance.
 Transmitting cost and commission of remittance in banking channel is still high.

 Migrant workers are not fulfilling abroad demand because they don’t have any training.

 Employment opportunities for women workers abroad have not yet expand fully.

 Without Islami bank Bangladesh other commercial banks are not perform as well as in
remittance sector.
 Female migrants are usually facing lack of a common understanding on a gender
sensitive and right based approach to employment
 In our country there is a big issue of polities. Election time all the economic sides are
 Recommendations
 Government has been proved that the official channels are more easy and safe to send money

from abroad.

 Government can start training for unskilled workers so that unskilled workers can take
training to make them skill and skill workers can make them more expertise.

 The government should establish different training & learning centers so that the migrant
workers could learn about language, behavior, culture, norms, values, behavior, &
geographical environment and so on before going to abroad.

 The government and private banks should increase the speed of their services throughout the

country and also decrease the paper work & documentation, which make it very simple & easy
for less educated or illiterate migrant workers to send their remittances through formal channel.

 The government should take necessary legal actions against those people who are involved

with undisciplined activities in the airports of the country.

THANK ’ S
FOR
YOUR
PASSTION ’ S
HEARING

THE END