No more Samurdhi and Divi Neguma receipts in cash

21 September 2015 04:08 am - 0 - {{hitsCtrl.values.hits}}

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Cashless social security payments system in the offing

Towards a creating society using less cash, the Central Bank (CB) in collaboration with Lanka Clear Private Limited is planning a ‘National Card System’ (NCS) to deliver social security payments in the country, according to a senior CB official.

The new system will be introduced under the brand name ‘Lanka Clear’ and this will enable the government to distribute Samurdhi and Divi Neguma payments in cashless form.

According to the Payments and Settlement Department Director Mala Dayaratne, the NCS will enable the government to significantly reduce the administrative costs in distributing the social security payments. It is estimated that at least one third of the total of these social security payments is spent on distribution of these moneys every month. “We want to reduce the use of cash in the system because it is a huge cost (printing notes and minting coins) to the Central Bank,” Dayaratne said at a seminar held at the National Chamber of Commerce.

Meanwhile, Lanka Clear Chief Executive Officer, Sunimal Weerasooriya said the conceptualization stage of the system has already concluded and is hopeful the Central Bank would delegate the task to them to continue with the development work.

“If the work starts now, we can get the system off the ground in a year’s time,” Weerasooriya said.

Similar systems are already in place in countries such as India, South Korea and Bangladesh.

Once NCS is fully operational, all social security payments could be loaded in to a card every month where the beneficiaries only having to swipe the card at any Point of Sale (PoS) machine. However Sri Lanka’s PoS terminal deployment and utilization is still in its infancy and there are only 35,000 PoS terminals around the country, of which a large majority is located within the Western Province. The fact that more than 80 percent of the currency remaining with the public also acts as a barrier to yield the full benefit of these systems.

According to Weerasooriya, on average less than four PoS transactions are carried out in a day.

Further, there are only 0.15 percent of PoS transactions made in a day, per card on average. This demonstrates the poor card utilization in Sri Lanka.

Even though there are little over one million credit cards registered in the country, there are only 350,000 active card users available.

As a sub-project in the Common Card and Payment Switch (CCAPS) which was initiated to provide the general public with payment facilities at cost-effective prices from multiple channels such as ATM, PoS, computer and mobile, Lanka Clear in 2013 launched the common ATM switch (CAS) which can connect all ATMs on a single platform.

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No more Samurdhi and Divi Neguma receipts in cash

Cashless social security payments system in the offing

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