CB begins process to develop PoC of blockchain-based shared KYC facility

Seated from left: Sampath Bank PLC MD Nanda Fernando, CBSL Assistant Governor R.A.A. Jayalath and UCSC Director Prof. K.P. Hewagamage
Standing from left: CBSL Payments and Settlements Director D. Kumaratunge, CBSL Governor Deshamanya Prof. W.D. Lakshman and CBSL Deputy Governor H.A. Karunaratne

Seated from left: Yaala Labs (Pvt.) Ltd CEO Lalin Dias, CBSL Assistant Governor R.A.A. Jayalath and Linearsix (Pvt.) Ltd CEO Mario Gooneratne
Standing from left: CBSL Payments and Settlements Director D. Kumaratunge, CBSL Governor Deshamanya Prof. W.D. Lakshman and CBSL Deputy Governor H.A. Karunaratne

• Selects 3 parties to develop PoC from over 40 companies 
• Among them were 17 foreign firms
• Shared KYC could increase financial sector efficiency and improve financial inclusion

The Central Bank of Sri Lanka (CBSL) yesterday entered into agreements to begin the process of developing blockchain technology-based shared know-your-customer (KYC) proofs of concept (PoCs). 

The CBSL identified the potential benefit for Sri Lanka’s financial services in 2018 and initiated an inter-industry study of blockchain technology, with the voluntary participation of the banks as well as the IT industry.

The CBSL advertised inviting companies with experience in developing blockchain technology-based solutions for shared KYC to join this project, on a voluntary basis. 
Upon receiving a number of applications, the CBSL selected three applicants to develop 
PoCs concurrently.

Over 40 companies, including 17 foreign companies, applied either individually or jointly, to develop the PoC. 

After several rounds of selection, the CBSL selected three applicants to be tasked with this pioneering project in Sri Lanka.

The selected applicants are: Sampath Bank PLC together with University of Colombo School of Computing (UCSC) as joint applicants, norbloc AB from Sweden and Yaala Labs (Pvt.) Ltd and Linearsix (Pvt.) Ltd, both Sri Lankan companies, as joint applicants.

Agreements were signed between the selected applicants and the CBSL, with the attendance of CBSL Governor Prof. W.D. Lakshman and senior bank officials.

In his remarks, the governor stated, “As we live in a world where every aspect of our lives is becoming digital, the Central Bank has taken a lot of effort to improve the digital financial infrastructure of Sri Lanka. 

Evaluating the feasibility of using a technology such as blockchain to securely share KYC information has the potential to vastly increasing digital financial inclusion of Sri Lankans. Shared KYC opens avenues to seek opportunities for increasing the access to financial services through digital and remote onboarding.”

As National Payment Council Chairman, CBSL Deputy Governor H.A. Karunaratne remarked on the interest that companies from all over the world join this national project that resulted in an extremely competitive selection process. 

He emphasised the importance of regulator-led inter-industry initiative to promote digital innovation in Sri Lanka in all areas and harness talent both locally 
and internationally.

Assistant Governor R.A.A. Jayalath highlighted that the benefit of the findings of the PoC will not only benefit Sri Lanka but also help advance the understanding of applying blockchain technology for financial services at global level.

Payments and Settlements Director D. Kumaratunge noted that Sri Lanka has embarked on a journey to promote digital transactions due to immense benefits 
it offers. 

He highlighted having a PoC for the shared KYC facility on blockchain technology will undoubtedly help advance financial services in the country.