Bankers recommended Wednesday providing incentives through banks to the beneficiaries of remittance as a mechanism to attract non-resident Bangladeshis (NRBs) in sending money home through formal channel.
The bankers put forward the suggestion at a meeting at Bangladesh Bank headquarters in the capital that runs counter to a finance ministry proposal in reducing the remittance cost — providing incentives to the exchange houses at the senders' end, if necessary.
The ministry had also requested the central bank to examine other ways of reducing the cost and attract the remitters to the formal channel.
As a follow up, the BB convened the meeting with top 20 remittance- receiving banks operating in the country.
Senior executives of the banks, who deal mainly with the inward remittance processing, and senior BB officials took part at the meeting, with BB executive director Ahmed Jamal in the chair.
The bank executives also urged the central bank to take effective measures for stopping 'digital hundi' allegedly being conducted by the mobile financial services (MFS).
They also suggested issuing a notification, asking the MFS providers to make sure that the remitters submitted their respective NIDs (National Identity Cards). It should be made mandatory.    
A BB senior official said the bankers explained their positions and alleged that the overseas exchange houses impose commission on the money sent by the NRBs.
"We do not impose any charge on the inward remittance," a senior executive of a leading private commercial bank (PCB) told the FE after the meeting.
Majority of the bankers recommended the BB for taking measures to incentivise the remittance receivers instead of the senders, he said. It would help boost remittance inflow.
"We'll communicate the recommendations with the finance ministry," an official of the BB said.
The meeting discussed issues like the latest trend in inward remittance and the
exchange rate of the local currency against the US dollar, particularly in cases of inward remittance.

Besides, leakage in channelling small-sized remittances through non-bank channels came up for discussion, the private banker said.
Another meeting with the top remittance-receiving banks is scheduled to be held on Monday next, mainly to discuss about making it mandatory to open a bank account by the workers before their going abroad.
It might make them aware that they would have to send money home through the account, said a banker.
The government's latest move came against the backdrop of falling trend in inward remittance in the recent months, following the slower development activities in the Middle-Eastern countries due to lower price of fuel oil in the global market.
A rising trend in sending hard-earned money by expatriate Bangladeshis through informal channels has also pushed down the flow of inward remittances, according to the bankers.
The inflow of remittance dropped by 14.48 per cent to US$12.77 billion in the outgoing fiscal year (FY) 2016-17 from $14.93 billion a year before, BB data showed.
The central bank as well as the government is now working on revamping the flow of inward remittances in the current fiscal year.
As part of the move, the central bank had asked the banks for taking measures to attract NRBs through improving the quality of remittance services.
The banks have also been instructed to open 'help desk' at each branch concerned for ensuring better remittance services.
siddique.islam@gmai.com [Read More]

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Source: The Financial Express