State-owned banks have surpassed private banks in attracting remittances this February by offering more competitive exchange rates. During the initial 22 days, the state banks received a noteworthy USD 831 million in remittances. In October, Bangladesh’s remittance inflow for the month also recorded at an impressive total of USD 1.93 billion with private banks’ share reching to USD 1.09 billion.
The remittance surge is considered important for the economy of the country, especially to meet the import needs of the government. The jump comes at a moment when state-run banks are struggling with scarce dollar liquidity from the central bank, a evolution that has made it tougher for them to fulfill demand. It is also due to an increasing trend of remitters utilizing the more favourable exchange rates provided by purpose-built exchange banks.
The move came on the back of higher remittance inflow and a skyrocketing exchange rate of BDT 122.70 per USD, which increased the pressure on banks. With the remittance rate rising higher and higher, this will lead to changes in market dynamics with state and private banks competing to gain a larger share. This reflects the beauty of financial competition and its relevance of accelerating perpetual flow of foreign currency into the country for surviving as a Forging Nation.
Source: Business Inspection BD
