Sri Lanka’s financial market regulator Central Bank of Sri Lanka recently requested from Colombo Stock Exchange (CSE) to request listed companies to pay dividends through electronic means and stop issuing paper cheques.
Central Bank Governor Indrajit Coomaraswamy addressing Asia-Pacific forum of central depositories in Colombo said that “We encourage and request the CSE to consider the possibility of mandating use of electronic payment methods currently available”. He further added that a committee set up to find ways to reduce physical cheque payments found that dividend payments by listed firms made up a large volume of cheques still issued in the country.
“Some were for very small amounts” he told reporters adding that the Central Bank was setting up a central counterparty and fully electronic trading platform for government securities. There is a central depository for government securities, but trading was also done manually.
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