The Hon. Ravi Karunanayake

¶ 01 Thank you, Hon. Speaker, for allowing me to raise this Question.

¶ 02 Sri Lanka is trying to rebuild the external sector through tourism receipts, digital services, and SME-led primary exports. However, with the rapid evolution of global payment mechanisms, there seems to be a significant mismatch between the country’s foreign exchange and payment systems. Despite the increase in tourist arrivals and the rapid growth of digital entrepreneurship among youth, limitations and inefficiencies in cash acceptance, payment platforms and settlement methods are impeding inflows, distorting markets and imposing unnecessary costs on citizens and businesses.

¶ 03 With regard to modernizing Sri Lanka’s foreign exchange ecosystem and supporting emerging sectors, I would like to ask the Hon. Minister of Finance, Planning and Economic Development the following questions:

¶ 04 1. What are the officially recognized and accepted “hard currencies” in Sri Lanka for transactions, settlements and reserves, and what criteria are used to determine such classifications?

¶ 05 2. Given the significant inflow of tourists, why has the Government not operationalized or encouraged the acceptance of currencies such as the Russian Ruble, the Indian Rupee, the Chinese Yuan and the Japanese Yen for domestic transactions through banks, hotels and digital payment systems? I ask this because, in the South, there are payment platforms being used where card payments do not get credited to Sri Lanka; the monies end up outside the country.

¶ 06 3. What are the Central Bank’s policy, regulatory or operational constraints that prevent the wider use of these currencies, both in cash transactions and card-based payments within Sri Lanka?

¶ 07 4. Why is there a substantial spread between the buying and selling rates of foreign currencies offered by banks and financial institutions? What oversight mechanisms ensure such spreads are fair and not exploitative to consumers and businesses? Today, a foreigner or a person residing overseas gets Rs. 309 per US dollar at the Airport, but to buy a dollar he must pay Rs. 320. Such disparity is not seen elsewhere in the world. I expect an explanation.

¶ 08 5. Advise total profits earned by licensed banks and the Central Bank from foreign exchange transactions with the Government and the public during the years 2023, 2024, 2025 and to date.

¶ 09 6. Why are globally recognized digital payment platforms such as PayPal, Wise and Skrill not fully enabled or interoperable in Sri Lanka for receiving export proceeds, freelance income and service payments? We can remit funds out of the country, but those paid from abroad for services rendered in Sri Lanka cannot use platforms that bring dollars into the country. That is a crime.

¶ 10 7. What steps has the Government taken to facilitate seamless inward remittances and digital payments for Sri Lankan freelancers, startups and SMEs engaged in cross-border trade in services?

¶ 11 8. While digital currencies are not legally recognized, it is widely reported that cryptocurrency transactions continue outside the formal system. What measures are being taken to regulate, monitor and bring such activities within the tax net?

¶ 12 Sir, there has been a report regarding a fraud at NDB ongoing for the last three years. Monies were remitted abroad. It was reported in the Annual Reports for 2023/2024 and 2024/2025, but the Central Bank’s Bank Supervision Department has not looked into it. People are harassed in small matters by the Central Bank while big matters are ignored. I have always said the independence—or lack thereof—of the Central Bank affects the credibility of our economic system. I would appreciate your looking into this and giving us an Answer.

¶ 13 Thank you.