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“Circulation of currency outside banking system causes 1.5% waste to country’s GDP”

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Over Rs 1 trillion circulated outside the banking system in the 3rd quarter 2023 and that causes 1.5% waste to the country’s GDP Channa De Silva told the launch of JustPay and PayMe apps event held in Colombo on Tuesday.

He said the problem was Rs 835 billion or 75% of cash in circulation is outside the banking system and 25% is in the banks. He said this 75% that sits outside the banking system does not generate transactions or economic value. He said their target was to bring this money into the banking system and if it could be reduced to 50% it would be a decent achievement.

He said a recent market survey revealed that out of the population above 15 years which is around 15 million there is an average 67% Smartphone penetration. The average age of a Smartphone user is 32 years. Out of those Smartphone users 85% are below 42 years. 53% Smartphone users are females and 47% are males. In terms of the social economic groups out of Smartphone users 85% are using at least one social media platform and there are 7 million average monthly YouTube users 8.4million average monthly Facebook users and 1.9 mn Instagram users in Sri Lanka and nearly 27% purchase online at least once a month. He said last year the value of realtime transactions was equivalent to nearly 37% of Sri Lanka’s GDP. Theoverall value of transactions that went through Lanka Pay in the last financial year was Rs 24 plus trillion. He said they did nearly 23 million low value retail mobile payment transactions last year and 52% of these transactions were below Rs 1,000.  Meanwhile Lanka Pay unveiled its latest payment apps JustPay and PayMe. The launch followed with a round-table discussion.

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