Central Bank hopeful of PayPal’s arrival in Sri Lanka

The Central Bank remains hopeful of the prospects of PayPal Holdings Inc., the US-based international payment gateway company, to open access to Sri Lanka to facilitate Internet-based payments. 

Central Bank Governor Professor W.D. Lakshman earlier this week said that they had already spoken with the nearly ubiquitous payment gateway provider and are expecting a positive outcome of the talks. 

“The Central Bank has already commenced discussions with international payment service providers, such as PayPal, to enable payment receipt facilities for Sri Lankan residents and we expect positive outcomes in the near future,” he said this week unveiling the monetary and financial sector policies for 2021 and beyond. 

Providing access to PayPal for Sri Lankans has been in the pipeline for nearly a decade but it didn’t materialise for several reasons.

Although the Central Bank maintains that PayPal has been hesitant to enter the country due to the small market size, which translates into a smaller number of transactions, the Information and Communication Technology Agency (ICTA) is of the opinion that the online payment platform is not keen to enter Sri Lanka due to the complexities in the country’s Exchange Control Act.

However, the stakes remain high for the country to choose a path to facilitate cross border trading in its high-scale agenda of small business support and uplifting merchandise exports.

Currently, a lot of Sri Lankan digital entrepreneurs are compelled to rely on intermediaries, who would charge almost 14 percent of the income earned as various fees to obtain their payments for their gigs, particularly with the US and European companies.