As South Asian economies have been focusing on digitalisation efforts to uplift the overall government and financial sector infrastructure, the Central Bank of Sri Lanka asserted that improving focus in this arena will be a game changer for the island nation.
Central Bank Governor Dr. Nandalal Weerasinghe noted that Sri Lanka can no longer afford any slowdown in its digitalisation efforts as the success of the financial sector and the direction of the national economy toward prosperity largely relies upon this area.
“Sri Lanka is moving into the financial services digitalisation stage and a major part of this effort is the digital ID.
All payments related to infrastructure facilities and resilience to climate change should be completed. Likewise, payments for infrastructure should be made efficiently and effectively. We need to do these two things basically,” Dr.Weerasinghe told a high-level policy panel facilitated by the International Monetary Fund (IMF) to deliberate on South Asia’s path to resilient growth.
The Governor noted that Sri Lanka can draw learnings from neighbouring India for this purpose and acknowledged that digitalisation can play a big role as it embeds into several areas, such as social security programmes, financial inclusion, tax payments, tax relaxation, port charges, local revenue, and excise duties.
“We are already somewhat late, but we are trying to do this. After doing this, it becomes a very valuable tool. And it is related to all financial transactions. Financial inclusion, financial literacy, and efficiency are important. It is important for efficiency and productivity.
So, we are not there yet but we are very careful about that. This is why I think this is the best path to victory for us,” said Dr. Weerasinghe.
He also pointed out that next on the cards for Sri Lanka is to introduce central bank digital currency (CBDC).
The IMF in its latest publication ‘South Asia’s Path to Resilient Growth’ pointed out that although the region as a whole has made impressive progress in digitalisation, there is scope to scale up the use of digital technologies in revenue administration, payroll systems, and procurement.