Conrad Dias, who serves as the Vice Chairman of the Fintech Forum Sri Lanka and is also the Chairman of LOLC Finance PLC, emphasizes that the upcoming phase of Sri Lanka’s fintech landscape revolves around enabling local fintech firms to tap into larger regional markets. This entails enhancing cooperation with banks and regulatory bodies while fostering an ecosystem that promotes sustainable growth over the long term.
For fintech enterprises in Sri Lanka, one of the primary obstacles to expansion is market size rather than innovation. With a population exceeding 20 million, even the most successful fintechs will ultimately need to look beyond national boundaries to achieve meaningful growth.
According to Dias, establishing pathways to larger regional markets should be a crucial focus for the nation’s fintech ecosystem. “For instance, if our fintech companies can operate in certain African nations, they could access a market comprising approximately 200 million individuals,” he stated. “That’s nearly ten times the population of Sri Lanka.”
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Dias asserts that the real challenge lies not in the country’s capability to develop innovative fintech solutions but in whether the ecosystem can facilitate the scaling of these innovations into sufficiently large markets that can support globally competitive enterprises.
The Fintech Forum aims to tackle this issue by uniting banks, financial institutions, fintech startups, payment service providers, technology firms, regulators, and policymakers, thereby enhancing industry collaboration and alignment.
Currently, nearly every bank in the country is actively participating alongside fintech companies, LankaPay, and other key stakeholders in the ecosystem, with the Central Bank of Sri Lanka also playing a significant role.
With this foundational collaboration in place, Dias noted that the Forum is ready to enter its next phase, which will focus on accelerating innovation, enhancing engagement with policymakers, and creating opportunities for regional growth.
The previous year’s Sri Lanka Fintech Summit marked a pivotal moment for unifying the ecosystem. Building on that success, the Forum intends to host an expanded Fintech Festival this year to engage an even wider array of industry participants.
International collaborations are increasingly pivotal to the Forum’s strategy, with Dias highlighting that such partnerships should lead to concrete business opportunities rather than merely serving networking purposes.
The Forum has already forged connections with fintech associations in Singapore, Taiwan, and Africa, allowing for knowledge sharing, business networking, and potential market entry.
While Sri Lanka offers a conducive environment for developing and validating fintech solutions, Dias pointed out that sustainable commercial growth often necessitates access to much larger markets.
By leveraging connections with international fintech ecosystems, the Forum seeks to assist Sri Lankan companies in identifying potential partners, understanding regulatory landscapes, and exploring expansion avenues that might be challenging to navigate alone.
According to Dias, successful global expansion must be supported by a robust domestic fintech environment. The Forum’s initiatives are centered on three interconnected areas: enhancing collaboration among industry players, advocating for policies that encourage innovation while ensuring financial stability, and fostering ecosystem development through knowledge sharing, workshops, industry events, and international alliances.
These efforts aim to dismantle barriers that individual fintech firms may struggle to overcome on their own, facilitating a quicker transition from innovation to commercialization.
Improving access to financing for small and medium enterprises (SMEs) and micro-SMEs is another critical focus area. Traditional financial institutions often find it costly to serve these segments due to regulatory and operational demands. In contrast, fintech companies are increasingly developing digital solutions that can reach these businesses more effectively.
According to Dias, fostering collaboration rather than competition between fintechs and traditional banks is the most effective approach. Fintechs can introduce innovation and technology, while banks provide essential financial infrastructure, regulatory compliance, and institutional credibility.
By merging these strengths, financial services can be extended to businesses that have historically been underserved.
He cited buy-now-pay-later (BNPL) platforms in Sri Lanka as an initial instance of embedded finance. However, Dias foresees a far broader potential for similar financial solutions to be seamlessly integrated into e-commerce platforms, super apps, digital marketplaces, and sector-specific ecosystems.
He anticipates significant growth in embedded finance over the next three to five years as open banking evolves, allowing financial services to be more integrated into the digital experiences that businesses and consumers currently utilize.
As fintech innovation accelerates, Dias believes that regulatory frameworks must evolve in tandem with technological advancements.
Digital lending, in particular, is gaining increased attention. While licensed banks and registered financial institutions operate within established regulatory frameworks, some online and fintech-based lending platforms may function outside conventional structures, potentially posing risks to borrowers, including SMEs that may not fully grasp the implications.
Dias asserts that clear and proportionate regulation can bolster confidence among consumers, financial institutions, and fintech firms without stifling innovation.
The Forum is actively engaging with the Central Bank to promote regulatory frameworks that support innovation while enhancing consumer protection. Drawing from international examples such as Singapore, Dias believes that clearer governance could ultimately lead to a healthier and more sustainable fintech ecosystem.
In response to inquiries regarding industry-wide data sharing and access to datasets like CRIB, Dias indicated that performance data sharing is already occurring within the LankaPay ecosystem. However, broader access to certain datasets would necessitate deeper collaboration between banks and fintech companies.
He emphasized the critical role banks play in providing the reliable governance and institutional frameworks essential for the sustainable development of the fintech ecosystem. As collaboration deepens, the Forum aspires to cultivate an environment where innovation can flourish without compromising necessary safeguards within the financial services sector.
Dias envisions fintech as a significant driver of Sri Lanka’s broader digital economy, with the potential to support entrepreneurs, enhance access to financial services, and foster deeper collaboration across the financial ecosystem.
For Sri Lankan fintech companies, this acceleration increasingly involves looking beyond a domestic market of over 20 million people and establishing partnerships that can provide access to significantly larger regional opportunities.
By enhancing collaboration among local stakeholders and developing international partnerships across Asia and Africa, the Fintech Forum aims to assist Sri Lankan fintech companies in transitioning from promising local innovations to commercially viable regional players.
Caption – Conrad Dias – Vice Chairman of the Fintech Forum Sri Lanka and Chairman of LOLC Finance PLC
Financial Chronicle Biz English | Sri Lanka Business News.
