Digital payment platforms across state agencies, an IMF condition
While a majority of government institutions are not digitally-friendly in Sri Lanka, there is something the government of Sri Lanka must focus on, that enables the ease of tax collection. If all government offices start collecting any form of payments via digital platforms, there is a track record of transactions and cash maintenance costs could be drastically reduced.
Visa, Group Country Manager for India and South Asia, Sandeep Ghosh on the sidelines of a media briefing held on Monday at the Courtyard by Marriott Hotel in Colombo, told the Business Times that, the government of Sri Lanka must take the initiative to mobilise digital payment platforms across all government offices as it eases the tax collection process. “It is one of the International Monetary Fund (IMF) conditions that Sri Lanka mobilise digital payment platforms across all government institutions as it eases the tax collection process and monitor transactions,” Mr. Sandeep stressed.
The cost of maintaining physical cash will be reduced drastically by adapting to digital payment platforms, he added. “Considering the volume of government institutions in Sri Lanka, Visa will provide a fairly less surcharge than other merchants in the country. India also had the same mentality of not adapting to digital payment platforms, but today the penetration of digital payment systems has doubled over time,” noted Mr. Sandeep.
Visa, Chairman for Asia Pacific, Chris Clark also told the Business Times that the usage of digital payment platforms in the US is only 28 per cent, lesser compared to South Korea and Australia. “Though Visa is a US based financial services company, only 28 per cent of the US population uses Visa cards. South Korea and Australia are ahead of the US in terms of the Visa card penetration,” said Mr. Clark.
During the media briefing on Monday, Visa celebrated 35 years in Sri Lanka and unveiled its government solutions for the market. Also at the event Visa announced a pledge of Rs. 13 million to the Asia Foundation to help support women-led small businesses in Sri Lanka.
Mr. Clark stated that Visa estimates digital payments to go up to US$7 billion by the end of this year and expects a compound annual growth rate of 20 per cent in the next four years doubling to $14 billion by 2027. He also mentioned that ecommerce is estimated to grow up to $2.5 billion and the number of ecommerce users could grow up to 10.7 million by 2027.
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