Former SEC chief slams banking sector and professionals over SME neglect

By Nishel Fernando 

Former Securities and Exchange Commission (SEC) Chairman Ranel T. Wijesinha sharply criticised the banking sector, the accounting profession, and corporate entities for their collective failure to support small and medium enterprises (SMEs) in accessing the capital market.

Speaking at the official launch of the SME Creditworthiness Rating Framework and SME Connect Awards by CA Sri Lanka in Colombo, Dr. Wijesinha expressed deep disappointment over the systemic reluctance to empower the country’s most vital economic sector. 

He noted that despite major regulatory changes introduced years ago to ease the entry of smaller businesses into public equity, institutional support has remained glaringly absent.

 Wijesinha recalled that as far back as 2018, the SEC and the Colombo Stock Exchange (CSE) collaborated to launch the Empower Board, the first-ever dedicated SME board in Sri Lanka. However, very little progress followed due to widespread institutional apathy. 

“I as SEC Chairman was deeply disappointed that neither my own profession nor the banking community came to help empower the SMEs,” Wijesinha stated, emphasising that the end game of public markets must be to provide smaller enterprises with critical access to capital. 

He pointed out the stark disparity between large corporations and smaller businesses, noting that while prominent firms seamlessly tap into public equity markets to raise massive capital—such as PickMe recently collecting Rs. 3 billion—SMEs have been consistently left out in the cold.

The former regulator highlighted past concessions introduced specifically to dismantle structural barriers for smaller businesses. To make public listings realistic for emerging companies, the SEC engaged with the governing council to dispense with stringent International Financial Reporting Standards (IFRS) for SMEs, permitting a simplified standard instead. Furthermore, the SEC relaxed mandatory disclosures by replacing rigid quarterly reporting with a bi-annual requirement and introduced a sponsor framework led by investment banks to hand-hold smaller firms. 

“We at the SEC decided we will allow anybody who has capacity to invest in SMEs so that the funding availability is enhanced,” he said.

Despite these flexible regulatory pathways, Wijesinha lamented that the broader financial sector and professional advisory bodies have done very little to actively guide smaller enterprises toward public markets. Urging local financial institutions to take real accountability for domestic economic growth rather than emulating detached international benchmarks, he issued a strong call to action. 

“The time has come to ask our small and medium practitioners and also the banks who are invited repeatedly, who have done very little, to pull up their socks and remember they are living in Sri Lanka and not in Paris,” Wijesinha concluded.

The milestone framework and awards were officially launched by CA Sri Lanka President Tishan Subasinghe. The high-profile ceremony was attended by prominent financial sector leaders, including CSE Chief Executive Officer Rajeeva Bandaranaike, CA Sri Lanka Vice President Anoji De Silva, Altemet Chairperson Saman Srilal, and CA Sri Lanka Chief Executive Officer Lakmal Priyangika.