Law to protect migrant workers from dishonest money transferers underway

---

A Z M Anas
The Bangladesh Bank (BB) is drafting a "groundbreaking" law aiming to give the legal coverage to the millions of migrant workers who send home a sizable chunk of remittances annually.
A team of local and international experts at the central bank is now brainstorming on the proposed law, the first of its kind anywhere in the world, BB officials said.
If passed into law or ordinance, the would-be legal instrument will act as a shield for the Bangladeshi overseas workers and their families left home from any possible exploitation by the remitting agents and money transfer agencies.
The consumer protection legislation, designed exclusively for the Bangladeshi migrant workers and the diaspora community, is widely seen as time-befitting and critical in view of the First Solutions scam that has exposed the fault line in the remittance transfer system and the vulnerability of migrant workers as well.
BB governor Salehuddin Ahmed said the central bank would explore multiple mechanisms, including legal coverage, for ensuring "quick, safe and steady" flow of remittances.
Ahmed, however, noted the interests of migrant workers and remittance recipients could be protected through measures other than laws.
"I think, measures without legal instruments can be taken to protect the migrants and their families who live on remitted money. The concept of securitising remittances can also be effective in this regard," the central bank said in a telephone interview.
The draft law is being conceived in the light of the best practices for remittance transaction set out by the World Bank, the officials added.
"A preliminary draft of the legislation has been prepared. A group of local and foreign consultants are working on it," project director of the Remittance Payment and Partnership project of the central bank Khandakar Mazharul Haque told the FE.
"We're currently scrutinising the pros and cons of the law before sending it to the finance ministry that will again forward to the law ministry for vetting. If vetted, the draft law will be placed before the cabinet body for its nod," Haque said.
He insisted that this law would help the Bangladeshi workers, particularly the blue-collar ones, not only avoid future exploitation, but also make sure remittance transfer is less-costly.
He also agreed with the views that the law, if enforced properly, would help stem the recurrence of the First Solution incident in future.
The UK-based, Bangladeshi-owned First Solution, a money transfer agent, is allegedly misappropriated a large sum of remittances sent by the Bangladeshis living in Britain.
Explaining the benefits of the legislation, a political science professor of Dhaka University Tasneem Siddiqui said no other legislation combines best practices and consumer protection to assure that migrant workers have legal redress for exploitation.
Siddiqui, who is involved in the drafting process, also said: "When the people know that certain guarantees attached to remittances sent through formal channel and failure of the remitting agent to abide by that guarantee give them a method to get their money back, it will create an incentive for them to wire home money preferring the official channel."
"Once people begin to realise that these protections are being enforced and that they really have recourse through the law, more people will want to go abroad for the sake of their families because they won't be afraid that something bad might happen," she pointed out.
The law will making a level playing field for the remittance industry-everyone servicing this sector will need to abide by the same rules, not just banks, Siddiqui said as he explained the benefits.
The RPP project, financed by the UK's Department for International Development, is aimed at providing better information to consumers regarding remittance products and prices.
Remittances are considered critical to the country's economy, constituting approximately 7.0 per cent of GDP and growing at around 10 per cent a year.
Formal remittances into Bangladesh in the fiscal 2007 reached nearly US $6.0 billion, while an additional 40 per cent were understood to have channelled through the unofficial 'hundi' system.
International remittances reach 1.5 million Bangladeshi people, mostly the rural poor, bringing direct economic benefits and having a strong positive impact on GDP.