22 Jan 2024
As a Bangladeshi migrant, you work in Australia to earn a living to support your family back home in every money transfer from Australia to Bangladesh because the robust Australian economy offers jobs you hardly find in your native country.
The purpose is to attain financial stability for your family. Right?
You might think that your job abroad and the uninterrupted cycle of sending financial support back home is enough to achieve the above-mentioned purpose.
But have you ever thought about other factors that can help you a long way in achieving financial stability for your family?
Well, one of the factors is the government policies that cover the inbound remittances to facilitate the flow and ensure they contribute to the overall economic growth of Bangladesh.
This blog will walk you through the Bangladeshi government’s policies to increase the quantum and facilitate the flow of inward remittances.
The word ‘remittance’ literally means to ‘send back’. It makes its understanding far easier when seen in the context of the migrants who work in foreign countries to earn a living, and whatever they earn abroad, a major portion of it they send back to their families.
Millions of people, around 281 million, constituting about 3.60% of 2020’s total global population, according to an IOM UN Migration report, work in developed countries.
This migration is propelled by the poor-performing economies of developing countries like Bangladesh that cannot provide for their people.
It is one of the reasons why about 2 million Bangladeshi migrants are living in foreign countries, according to a report by Springer Link.
Therefore, remittance is what you earn in Australia as a Bangladeshi migrant, and a part of it you transfer back to your family.
As a Bangladeshi migrant in Australia, you earn a living there and send money to Bangladesh online from Australia to offer financial aid to your family back home.
You already have a fair idea about the immense importance of remittances that you send back.
But take a look below at the general purposes inward remittances serve to fully appreciate their importance.
In developing countries, including Bangladesh, millions of people are unbanked. With the flow of inward remittances, these unbanked people get a chance to enter the broader financial cycle of a country’s economy.
One of the core purposes of inward remittances is to provide financial support to the recipient family. You expatriate in the first place to elevate your and your family’s financial status. So, remittances serve this purpose to a large extent.
Although, remittances are personal and family-centric. But they can trigger economic growth at the macro level. For example, the $21.5 billion received in 2022 by Bangladesh provided the country’s economy with the necessary boost to stay afloat.
Let’s now understand some of the challenges inward remittances face in Bangladesh.
Earning a living in a developed country like Australia is easy due to the country’s robust economy. But when it comes to transferring funds back home to Bangladesh, the following few challenges create different types of hurdles. Take a look below.
Millions of people in Bangladesh lack financial inclusion. They are out and away from the country’s economic activities and thus lack access to investment and savings opportunities. They also lack access to credit offered by several financial institutions.
Several Bangladeshis have low financial literacy that precludes them from making informed financial decisions. Even though their family members continue to send money online to Bangladesh from Australia for financial support, they still live in poverty due to a lack of financial literacy.
In Bangladesh, the necessary financial infrastructure that can support modern financial technology is missing. It forces people to resort to the old and archaic financial services that only perpetuate their financial woes, leading also to rising remittance scams.
Learn here about remittance scams in 2023 and the ways to protect yourself from them.
If a country’s female population is left out of the economic activity, its impact will be grave. In Bangladesh, the widespread gender inequality hinders women from accessing the financial services that disallow inward remittances to fully realize their financial potential.
Let’s now look at the policies the Bangladeshi government has put in place to facilitate inward remittances.
As mentioned earlier, without the support of the respective governments, the remittance-receiving countries would face immense financial challenges. In this context, the Bangladeshi government has taken the following few initiatives to facilitate inward remittances.
The first initiative is lowering the taxation on inward remittances. Taxes always apply to a country’s inward remittances. If these taxes are high, the quantum of remittances can decrease. Therefore, the Bangladeshi government has lowered the taxes on inward remittances.
The Bangladeshi government has relaxed its financial policies and regulations to promote legal channels to process remittances. These policies make compliance easy for remittance transfer institutions, which encourages them to establish their presence in Bangladesh.
Since most of the remittance transfer service providers, including one of the world’s leading companies, ACE Money Transfer, use the latest technologies, the Bangladeshi government is establishing a financial infrastructure that is supportive of the latest financial technologies.
The Bangladeshi government is spreading awareness about the importance of financial literacy. The government is making optimal use of social as well as mainstream media to this effect. As a result, the level of financial literacy is on the rise in Bangladesh.
The Bangladeshi government is taking several initiatives to encourage its female population to participate in the country's economic activities both at the macro and micro levels. This is also facilitating the flow of inward remittances to Bangladesh.
To ensure that inward remittances are documented to become a part of the formal and legal economy, the Bangladeshi government is discouraging the use of illegal channels to send or receive remittances. This initiative is also supported by another initiative in which the government is supporting the establishment of credible remittance transfer companies that offer cost-effective ways to process remittances.
Through these initiatives, the Bangladeshi government has successfully managed to increase the quantum of inward remittances in recent years.
Money transfers back home also play an important role in the optimal use of remittances. So, make sure to send money to Bangladesh from Australia through a service provider that offers you cost-effective ways to do so.
The safest bet you can make to this effect is choosing ACE Money Transfer, as the firm has a wide worldwide digital presence, making it easy to access its services 24/7. The firm also offers you swift and safe transactions with live and market-competitive currency exchange rates and charges a low fee from just one stop. The fee you pay may be waived if the amount you send remains below a certain threshold, allowing you to enjoy as many fee-free transactions back to Bangladesh from Australia as you can!
The word remittance means to send back. Remittance is the money you send back to your family in your native country from abroad. Millions of migrants worldwide work in developed countries to earn a living and support their families through inward remittances.
Inward remittances have several advantages, including financial inclusion for those segments of society that are left out, family support, giving the necessary boost to the recipient country’s economy, and creating multiple job and business opportunities.
Inward remittances can benefit you in more ways than one. They can help you save to secure your future financially, help you establish a business to create employment opportunities, and set the economic wheel rolling at a broader level.
Some of the challenges inward remittances in Bangladesh face are lack of financial inclusion, wide gender inequality, lack of financial literacy, and the non-existent financial infrastructure to support the tech-driven movement of remittances across borders.
Some of the important initiatives the Bangladeshi government is taking to facilitate inward remittances are low taxation, promoting legal remittance companies, building necessary financial infrastructure, increasing financial literacy, enhancing female financial inclusion, and discouraging the use of illegal means to process remittances.
