CB to take strong action against leasing firms for being harsh on tourism sector firms over recoveries

• CB Governor stresses it is not permissible for leasing companies to seize vehicles as means of recovery
• Says such incidents should be brought to the notice of Central Bank via SLTDA

Stakeholders of the hard-hit tourism sector have been instructed by the Central Bank of Sri Lanka to bring to its notice of any leasing companies seizing vehicles for late payment of installment.

Central Bank Governor Ajith Nivard Cabraal this week asserted that it is not permissible for leasing companies to seize vehicles as means of recovery since they have been formally instructed to not do so for those involved in tourism.

At a meeting with the Governor in Colombo this week tourism sector stakeholders shared the issues that individuals and businesses in the industry continue to face difficulties although a slow recovery is observed in the industry with the increase in the number of international visitors to the country.

One of the key issues highlighted was the increase of the premium to be paid by the customer when extending the lease concession.

Cabraal asserted that “strong” action will be taken against leasing companies engaging in such practices, and the impacted stakeholder, via the Sri Lanka Tourism Development Authority (SLTDA), must bring such incidents to the notice of the CBSL. 

The governor also expressed confidence in the ongoing “pressure”, faced by the crisis struck tourism sector, easing by January 2022. He pointed out that stress will be at its highest until January 2022, after which it will gradually subside with the improvement of the conditions of the economy.

According to the CBSL, the tourism sector has been provided Rs. 4,100 billion as loan relief and interest on loans has been reduced by Rs. 330 billion.