The Blockchain committee, under the purview of the National Payments Council (NPC), chaired by Central Bank (CBSL) is currently studying the feasibility of developing the Blockchain technology in the areas of ‘Blockchain based shared KYC’, in Trade Finance and Insurance and other sectors.
CBSL has been fostering industry wide collaboration and the digital payment innovation policies are spearheaded by the NPC. It has spearheaded developments in FinTech as well as Blockchain technology.
Accordingly, two committees FinTech and Blockchain under the NPC have been appointed.
FinTech committee has been responsible for developing standardized national QR code and National Transit card for Sri Lanka, Central Bank Governor Indrajit Coomaraswamy said at the 22nd Annual General Meeting of the Asia Pacific Central Securities Depository Group (ACG) in Colombo yesterday.
Dr. Coomaraswamy also noted that CBSL is supportive of FinTech innovations and has initiated a regulatory sandbox, to provide FinTech companies with the necessary guidance when developing their products in a safe and secure environment.
“As regulators, our priority is to maintain the stability and support economic growth. In this respect, digitisation has given the regulators many opportunities. We have seen numerous benefits in terms of easing entry barriers to markets, correcting information asymmetry and promoting inclusive growth policies.”
He also emphasised the need to use FinTech to solve issues, open new vistas, expand businesses and generate benefits from new types of interconnectivity it offers.
With regard to payments and settlement landscape, the CBSL is continually aligning its infrastructure with international best practices, Governor Coomaraswamy noted.
“We are also in the process of developing data security standards to ensure that Sri Lanka is in line with the global mutual data protection requirements. As financial services are increasingly becoming digitised, FinTech innovation becomes a necessary norm in the global financial market.”
In addition, CBSL plans to establish a state-of-the-art electronic trading platform and a central counterpart clearing and settlement system to facilitate electronic trading.
In addition, The National Payments Council is also looking possible ways to reduce the use of cheques in Sri Lanka and the CBSL requested the Colombo Stock Exchange (CSE) to consider the possibility of mandating the use of electronic payment methods currently available when making dividend payments. “It has been identified that there is a high volume of cheques issued as dividend payments from the listed companies of CSE, even for small values”, he said.
Securities and Exchange Commission (SEC) Chairman Ranel Wijesinha said the Central Depositary System (CDS) in Sri Lanka needs to be more proactive and integrated with the ACG.
He said that SEC is deeply committed to provide all the assistance and support that is necessary for the CDS to reach that goal.
Wijesinha also stressed the need to create a taskforce in order to redress issues in terms of regulations, legislation, and building infrastructure in ACG in order to be a proactive regulatory partner.
“To me, the role of the regulator is extremely important and the robust regulation is a fundamental ingredient in a sustainable market economy.”
“We can’t live in isolation in technological developments.We need to create task forces to keep abreast and ready for the technological changes to come,” Wijesinha said.
The CSE also signed two MoU’s with Korea Securities depository and China Securities Depository Company at the event. The MOU’s were signed to strengthen the cooperation, mutual development and knowledge sharing activities between CSE and CDS.
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