Governor urges bankers to concentrate on rural community

The Governor of Central Bank, Ajith Nivard Cabraal urged the banking community to concentrate on strengthening the banking activities in rural, and under privileged communities that are living outside the western province. He made these comments delivering the key note address at the 19th Banking Convention organised by the Association of Professional Bankers of Sri Lanka recently, according to MTI officials.

“Financial Inclusion is very relevant and of great importance to the country. Financial inclusion simply means providing access to individuals or group to appropriate financial products or service. It is popularly considered as a process of making the sectors outside the financial system to be included into the system. On a macro level financial exclusion is a symptom and cause of poverty. About 23 percent of the Sri Lankan population is outside the financial system,” Cabraal said.

“Over the past several years, we have seen a continuous growth in the financial sector in Sri Lanka with the vast development in the various spheres. However as a developing economy there still exist certain gaps in providing financial service to the majority of the rural population. Greater accessibility of the low income groups of the society to the financial products would undoubtedly solve many financial difficulties faced by such groups which would lead to the enhancement of their living standards. In that sense the inclusion of the underprivileged segment of the society into the main financial stream can be immensely beneficial to the individuals, the financial industry and to the Sri Lankan economy” he said.

“Financial inclusion in the western province has taken place reasonably well. As result poverty level has reduced substantially in the western province. 38 percent of the bank branches numbering 5,500 are located within the western province. Therefore the numbers of branches in the other provinces need to be increased and that was why the Central Bank encouraged banks to reach out to other provinces when approving branches” he added. Commenting on the proposed controversial US$ 500 million international sovereign bond Cabraal said that the planned sovereign bond will create good image in the international financial market to our country and will bring enormous benefits thereafter. “The government's planned international sovereign bond would enable foreign investors to directly take part in infrastructure development and allow top corporate to get access to global capital markets.” “Sri Lanka isn’t the only country with issues over bonds. There have been other countries like Pakistan, Brazil, Cambodia, Vietnam and Philippines, which had concerns over obtaining bonds but proceeded” he further said.