Money sent home by Bhutanese residing overseas increased by about 3.5 percent as of November of last year, according to recent data released by the Royal Monetary Authority (RMA).
The RMA’s records showed that remittance increased to Nu 7.6 billion (B) as of November 2021. The remittance was recorded at Nu 7.35B as of the same month in 2020.
Remittance is a transfer of money by foreign workers (non-resident Bhutanese) back to their home country, which helps to improve the foreign exchange reserves and reduces the deficit in the current account by improving the country’s balance of payments.
More than half of the remittances received in the country are from Australia amounting to Nu 3.82B as of November 2021.
Remittances from America contributed to Nu 3.2B. Remittances in Pounds Sterling, Euro, and other currencies equate to about Nu 580.69 million (M).
The highest remittance inflow was recorded in the months of April and October with Nu 1.07B and Nu 1.05B, respectively.
The remittance inflow increased at a time when the USD had appreciated against the Ngultrum.
According to the RMA, the monthly average exchange rate of the Ngultrum increased to Nu 74.42 per USD in April 2021 and Nu 74.90 in October from Nu 73.11 per USD in January of the same year.
The exchange rate of the USD against the Ngultrum decreased slightly to Nu 73.73 in 2021 and was Nu 74.11 in 2020.
To encourage remittance inflow, the RMA launched a cash incentive scheme for Bhutanese who live, work, or study overseas in a pilot phase from June 1 of last year until May 22 of this year.
The beneficiaries will receive a cash incentive of one percent upon converting the remitted amount into ngultrum using the prevailing or applicable exchange rates through banking channels and the international money transfer operators.
The RMA also launched RemitBhutan in September 2016 to provide a platform for non-resident Bhutanese to remit their savings and earnings to Bhutan through formal banking channels. There are currently 2,411 accounts with RemitBhutan.