Central Bank of Sri Lanka Calls for Blockchain-Based KYC Proposals

The Central Bank of Sri Lanka intends to establish a blockchain-based know-your-customer (KYC) platform. 

In an open call published on its site on November 29, the bank revealed that it is looking for tech organizations that can develop a “proof of concept” shared KYC framework for its banking industry.

“The increasing demand for digitalised financial services has created an opportunity for Sri Lanka to evaluate the possibility of adopting Blockchain Technology to further advance Sri Lanka’s financial sector,” according to the bank’s invitation to apply.

The venture seems to be a joint effort between Sri Lanka’s national bank and the Sri Lankan technology sector, as it includes “experts” from Sri Lanka’s tech finance and tech enterprises.

A “shared KYC” framework, as delineated by the official statement, would permit commercial banks and the central government to share and update client information on a blockchain.

“It is expected that this would facilitate several potential use-cases that will increase efficiencies in the financial sector,” and “help increase financial inclusion in Sri Lanka,” the announcement said.

In any case, the statement is generally short on subtleties. The bank will share the KYC platform’s “high-level design” with the chosen candidate: a firm with at least two years of experience and a “proven track record of developing and launching mobile applications.

The open call comes amidst Sri Lanka’s effort to make itself on par with international financial regulatory guidelines.

In October, it was no longer part of the Financial Action Task Force’s (FATF) anti-money laundering/counter the financing of terrorism (AML/CFT) “strategic deficiencies” blacklist, demonstrating that the nation had reinforced its safeguards since put on the list in November 2017.

“The FATF welcomes Sri Lanka’s significant progress in improving its AML/CFT regime and notes that Sri Lanka has strengthened the effectiveness of its AML/CFT regime,” the watchdog stated in October.