Remittance has become a major contributor to the Bangladeshi economy. As the emigrant workers from Bangladesh gradually increased over the years, the amount of annual remittance to the country significantly rose. According to World Bank, Bangladesh is now one of the largest recipients of remittance with almost $15 billion as of June 2015.
Contents
History
In 1974, Wage Earners' Scheme was initiated in order to help the Non-resident Bangladeshis remit their earnings home through legal channels. The scheme soon became popular among the Bangladeshis working abroad. Some $11.8 million was remitted to Bangladesh in the fiscal year of 1974-75. The amount rose to over $350 million in the fiscal year of 1980-81 and to over $750 million in the fiscal year of 1990-91. The kingdom of Saudi Arabia has been the largest source of foreign remittance to Bangladesh. UAE, Qatar, Oman, Bahrain, Kuwait, Libya, Iraq, Singapore, Malaysia, the US and the UK are also major sources of foreign remittance.
Formal system
Remittance is sent formally through various ways such as demand draft, traveler's check, telegraphic transfer, postal order, direct transfer, Automatic Teller Machine. etc.
Informal system
Hundi or money carrier system is prevalent as informal process of remittance sending in most cases. The most popular reasons behind the preference towards Hundi system is the absence of any transaction charges, its fast delivery and the opportunity to maintain confidentiality.