Dhaka, Bangladesh (BBN) – Japan will provide US$2 million in grants for Bangladesh to improve remittance services, the Asian Development Bank (ADB) that will manage the fund.
The Bangladesh government and ADB signed the grants agreement at the Economic Relations Division in Dhaka on Wednesday.
The assistance will ease access to reliable formal remittance services, raise awareness on remittance process and provide training to at least 20,000 rural households on remittance and financial literacy, an ADB press statement said.
At least 12,000 rural households will also receive skills training and micro-enterprise development support.
It is estimated that more than 50 percent of remittances to Bangladesh are made through informal channels.
Bangladesh’s migrant workers often avoid the formal channel for remitting money to the county as they face a number of difficulties such as lack of access to the Bangladeshi network of banks and exchange houses, infrastructure and technology challenges, said Stefan Ekelund, officer-in-charge of ADB’s Bangladesh Resident Mission.
The Japan Fund for Poverty Reduction will provide the grants for technical assistance. The grant is expected to raise income of the migrant workers’ household by 10 percent from 2014, and increase use of formal remittance channels by at least 20,000 rural migrant workers’ households by the end of 2013.
The ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members – 48 from the region.