Sri Lanka to introduce digital currency by the end of this year
By: Staff Writer
January 14, Colombo (LNW): The Central Bank is to introduce a digital currency for Sri Lanka by the end of this year, its official told a top committee in Parliament yesterday.
“The exercise of introducing ‘Lanka Pay’ and ‘Central Bank Digital Currencies’ has already begun.
The two systems will be launched by the end of this year,” Central Bank officials informed the Ways and Means Committee in Parliament.
Central Bank officials were called before the committee to discuss issues pertaining to online payments in Sri Lanka.
Accordingly, the Chairman of Ways and Means Committee Patali Champika Ranawaka inquired about the regulation of online payment systems in Sri Lanka, Parliamentary Media Unit (PMU) said.
It was revealed that the absence of a financial registry in Sri Lanka results in 45 per cent of financial transactions going without being regulated.
MP Ranawaka proposed that QR code system which is used in fuel sales should be extended to financial services as well.
Also, he proposed that the Inland Revenue Department, Excise Department and Customs should adopt online payment systems. The focus was made on using blockchain systems for the purpose.
Ways and Means Committee requested the Central Bank officials to carry out a study on the online payment systems that are being implemented in countries such as India and Bangladesh and submit a report within two weeks.
In terms of strengthening the retail payment infrastructure, LankaPay (Pvt) Ltd (LPPL), under the guidance of the Central Bank, is developing the Government Digital Payment Platform (GDPP) via the LankaPay Online Payment Platform (LPOPP), to enable government institutions to receive payments digitally from the public.
With the aim of facilitating recurring payments digitally, the Central Bank also expects to mandate Licensed Banks to implement the direct debit facility, which enables an approved third-party organisation to automatically collect a payment up to a specified amount from the customer’s bank account on a scheduled date.
To promote digital transactions and remittances via e-money services, the value limits of enhanced e-money accounts and basic e-money accounts were increased with effect from 01January 2024.
Further, LANKAQR would be extended to enable the use through foreign payment apps so that both local customers and foreigners may utilise LANKAQR for payments in Sri Lanka.
One of the key challenges identified by the Central Bank to promote digital transactions among the public is the lack of awareness regarding the availability, methods, and benefits of digital transactions.