Central Bank warns of cyberattacks, fraud and data breaches in digital financeCentral Bank warns of cyberattacks, fraud and data breaches in digital finance
Central Bank Governor Dr. Nandalal Weerasinghe has warned that the rapid expansion of financial technology could expose Sri Lanka’s financial system and consumers to new risks, including cyberattacks, fraud and data breaches.
Addressing the Sri Lanka FinTech Festival on Tuesday (3), the Governor said financial innovation must be accompanied by strong regulatory safeguards to protect consumers and maintain financial stability.
He identified cyberattacks, operational disruptions, fraud, data breaches, inadequate consumer disclosures and excessive leverage among the emerging risks associated with financial technology.
The Governor also raised concerns over the growing concentration of critical financial services among technology providers, warning that such developments could introduce additional vulnerabilities into the financial system.
He noted that cross-border digital transactions could complicate regulatory oversight, while certain digital assets could expose consumers to significant price volatility and facilitate illicit financial activities.
Dr. Weerasinghe stressed that financial stability could not be compromised as Sri Lanka continued to embrace technological innovation.
He said the challenge was to strike the right balance between encouraging competition and innovation while ensuring effective supervision, sound risk management and strong consumer protection.
The Governor acknowledged that digital payments, mobile banking, internet banking and other financial technologies had already transformed how individuals and businesses conduct transactions in Sri Lanka.
He said further developments in digital identity, data-driven lending, cross-border payment connectivity and digital investment services could create new opportunities for the country’s financial sector.
Meanwhile, Dr. Weerasinghe reaffirmed the Central Bank’s commitment to supporting responsible financial innovation, highlighting its FinTech Regulatory Sandbox, which allows eligible innovative financial solutions to be tested under appropriate safeguards.
He emphasised that technological progress must be pursued while maintaining public trust, consumer protection and the stability of Sri Lanka’s financial system. (Newswire)