Inward remittances crossed USD 2 billion in March for the first time since last August, fuelling hope that it can help ease the prevailing dollar crisis in the banking system.

Bangladesh received remittance of $2.01 billion in March, an appreciable increase of almost 30 percent from the $1.56 billion received in February, that itself was a steep drop from the $1.95 billion received in January.

According to latest data from Bangladesh Bank, total inward remittances for the first nine months of the fiscal stood at $16.01 billion at the end of March, slightly higher (4.8%) than the corresponding figure from the last fiscal, when it was $15.29 billion.

The foreign exchange markets can gain some much-needed stability if remittances keep rising. The central bank has been forced to restrict the opening of LCs by private importers, saving its reserve of dollars to import essential commodities and industrial raw materials, sector insiders said.

Bank officials said many import payments are being deferred due to the dollar crisis. For this, expatriate income dollars are being exchanged at a higher rate than it is for trade purposes. 

Bangladesh Bank spokesperson Mesbaul Haque told UNB that to increase remittance inflow, the central bank has increased the exchange rate of US dollars for remittance.

In addition to a 2.5 percent hassle-free incentive for remittance, several banks also provide additional incentives to attract foreign exchange, he said.

There are no charges or fees at the receiver's end for remittances sent through official channels.

Research by Bangladesh Bank estimates  that more than 40 percent of expatriate income is still arriving through unofficial channels (hundi).