Restructure e-banking systems for transactional efficiency

It is a widely known fact that many citizens relying on government funds such as Samurdi, Covid-19, pension and other payments are subjected to needlessly excruciating barriers coloured with corruption and red tape, and given the extensive amount spent securing these payments come at a huge personal cost to the individuals, a very vulnerable group of citizens.

On the flip side, the government too encountered many difficulties with regard to managing the transfer of various social payments to the public, due to many of them not having bank accounts. The current system in place to process and deliver these payments is outdated, relying on physical record keeping and transactions. People receiving social benefits, rely on cheques being delivered via post, or having to personally make the trip to collect the monies issued by such payment orders by visiting relevant government offices. In an era where electronic payments are increasingly becoming the norm, as well as a preference for its many benefits, measures to move away from physical transactions to safer and efficient systems should be taken.

Our government has a clear opportunity to better manage this by first making it mandatory by law for citizens to register with a bank for a savings account. This would minimise systematic errors and maximise resources and process efficiencies.

Sri Lanka has proven its potential to be a very technically affluent demographic, as such if the Central Bank were to work along with the current government to take active steps to shift the existing processes to a digital more cost effective and manageable process, the many issues that are encountered could not only be avoided but also controlled in a more profitable manner.

In an effort to plot a path in the right direction for the future, the government should also consider designing and launching an initiative to encourage every person, in the demographic of 16+, to open a personal bank account by the time they are issued with their National Identity Card. There is a good opportunity to capitalise on this market by offering savings account options with good interest rates and current account options such as Mahapola payments, scholarships, medical insurance coverage, educational benefits and with good external incentives and without any annual bank service charges. Youth engagement plays a huge part in the future of economic development, and by enabling this group to become active members in the community and our industries from a young age it would produce a breed of young professionals in the country.

Another point of interest to consider would be to offer private and government sector employees special banking packages, benchmarking the ones offered in countries like the UK, where banks liaise with external businesses to issue value-added services such as mobile insurance, car insurance, life insurance, Spotify/music, hospitality, mortgage benefits to first time buyers, and would serve as incentives to encourage savings. This of course could be locally customised.

The right implementation of such efficient systems with an affordable interest rate, would not only encourage savings account holders to save on their monthly income, but having such support would also enable the individuals to set life-goals seen as achievable. Furthermore moving towards a digital platform will create awareness and behavioural advancement in personal financial handling that would ultimately allow people to enjoy life without any unnecessary external disruptions or barriers. Improving the chances of having a better quality of life in would ultimately lead to an ambitious and a productive workforce.

This brief proposal is to invite our government officials to embrace innovation and outside-the-box-thinking, to provide a much-needed change in our existing outdated banking packages, to be more in line with the new generation and embrace the digital age. Such systems would work to capitalise on the market to bring revenue to the government coffers , as well as protect people’s lives by training them to have positive financial goals. Such stringent systems would be a beacon and deter any illegal activities and corruption.

H. H.S ARATH

Pelawatte,Battaramulla