From left: ICTA Special Projects Director Kanchana Thudugala, ICT Agency (ICTA) Acting CEO Dr. Ajith Madurapperuma, ICTA Legal Director Jayantha Fernando and ICTA Projects Director Indika de Zoysa Pic by Pradeep Dilrukshan
By Chandeepa Wettasinghe
Key government agencies have to overcome an impasse on the required legal framework for the controversy ridden National Payment Platform (NPP) to get the green light, Mirror Business learns.
“It’s just a matter of reaching an agreement. When two or three parties talk, it can take a long time. It appears that it’s straightforward but when you go to the ground level, it sometimes takes a lot of convincing,” ICT Agency (ICTA) Acting CEO Dr. Ajith Madurapperuma said.
Speaking to Mirror Business following a media briefing on ICTA’s plans and progress, Dr. Madurapperuma yesterday said that a committee comprised of ICTA, Central Bank and Finance Ministry officials is trying to come to an understanding. “Discussions are going on because we want to clear up these misunderstandings, misconceptions, the legality of it and how it can be fitted into the existing framework. If the Central Bank agrees and the other parties agree that this is needed, there would be no issue,”
The NPP is being developed to send messages and requests between merchants, customers and banks on instructions for payments and transactions.
Dr. Madurapperuma noted that the project is essential for the country, and the small and medium scale enterprises (SMEs) which comprise of 70 percent of the businesses in the country.
“When you go to any forum, the SMEs are crying out for a National Payment Platform,” he said.
Currently, a handful of big banks control digital payments within the country, and most of the services are unaffordable by smaller scale merchants.
According to Dr. Madurapperuma, some headway had been made into the NPP project, since the Central Bank agreed to revisit the project, after clearing some of the misunderstandings.
ICTA Legal Director Jayantha Fernando said that the current Central Bank digital infrastructure may already be able to support the project.
“The question is whether they can send the request and follow instructions from the Central Bank clearance system is the arrangement that the Central Bank has to clear, after studying the system. At the moment they are studying the system,” he said.
Fernando further added that a simple app for utilization at the user-end could be developed to connect to the existing Central Bank system.
The NPP was halted this August, after the government took the stance that Former ICTA Managing Director/CEO Muhunthan Canagey had exceeded the state agency’s mandate by getting private companies to develop the NPP without the authorization of the Central Bank as legally required, and President Maithripala Sirisena forced Canagey to resign, in a move that also had political overtones.
The ultimate ownership of some of these private companies, and unlawful gains which could be made by such individuals through the NPP has come into question.
The issue was exacerbated by the former Finance Minister Ravi Karunanayake—who was also forced to step down following his alleged connection to unlawful super profits earned by a controversial private company—endorsing the development of the NPP outside the Central Bank’s authority in the 2017 budget, over a year after NPP started gaining traction.
The NPP was being developed at a time when Karunanayake was attempting to severely undermine the authority and independence of the Central Bank and gain more influence to dictate the policy directions of the Central Bank.
Just four days before the NPP’s development was halted this August, the Central Bank released a statement saying that developing an NPP outside the Central Bank could undermine the country’s financial stability, and that the Central Bank had repeatedly asked ICTA for details on the development, but such information was withheld from the Central Bank.
However, Dr. Madurapperuma said that this was incorrect, and that the Central Bank was kept informed and consulted on the development.
“There was some misunderstanding on the legality. Now we have sorted it out and then the Central Bank asked to send the documentation that we have,” he added.
National Policies and Economic Affairs Deputy Minister Dr. Harsha de Silva who ordered the suspension of the project in August had called for a full scale investigation into the issue.
Meanwhile, Fernando said that ICTA fully supports regulatory oversight.
“ICTA’s position is that we will respect the regulatory oversight. We can’t do it without that. We will do it the right way,” he said.