Business
SMB Finance CEO predicts lending rates will fall in 2023
by Sanath Nanayakkare
Making an interesting bet on the cost of borrowing money by entrepreneurs and businesses, Supul Wijesinghe, CEO of SMB Finance predicted a fall in interest rates in 2023 or in the foreseeable future.
“Interest rates should come down next year or in the foreseeable future as a result of the measures being taken by the Central Bank of Sri Lanka (CBSL) and other stakeholders,” he said addressing the media in Colombo recently.
He made this remark responding to a query from the media as to how his non-banking financial institution – which was recently elevated to SMB Finance from SMB Leasing – would deal with having to lend potential customers at an interest rate of over 30%.
In response he said, “When you have a 30% government borrowing rate – which is bench marked as a risk-free rate by the market, obviously lending rates would be higher than that. In such a context, entrepreneurs will surely contemplate whether they can borrow funds and operate a business with an interest rate of over 30%. This is an issue, and at present, lending is curtailed in both banking and non-banking financial institutions sector due to this reason. But I think this trend will see a favourable change in 2023 or in the foreseeable future.”
SMB Finance currently has 3 branches and they are planning to expand it to 10 branches for which approval has been sought from the CBSL.
“We should have nothing but optimism as we enter the Year 2023. We are looking to set up new branches in four provinces and how and when branches can be set up in the North and the East will be determined subsequently. It could possibly happen in 2024. We have to be mindful of our overhead costs when setting up branches because we have to deliver value to our shareholders,” he said.
When asked about SMB Finance’s growth plans for 2023, he said, “We are planning to launch several new products targeting the small and medium enterprise (SME) sector which has been adversely affected as a consequence of the country’s economic crisis. In Sri Lanka, we mainly pursue asset-based lending. SMB Finance will be looking at entrepreneurs and businesses that don’t have the required collateral, but are running a fairy good business in terms of their cash flow. For instance, I would like to tell you about one of the products we are currently offering the tea industry. There, we enter a tripartite agreement with the tea broker, tea estate/factory and SMB Finance. Through this arrangement, the payment assurances are given by the tea broker affiliated with the tea estate. This way we mitigate the default risk and also support the borrower in a sustainable way. Similarly, we will be looking at various industries producing ecological products and have a steady cash flow. We will be announcing our new product portfolio in the first quarter of 2023.”
SMB Finance PLC Chairman, Ravi Wijeratne, stated that the award of the business license to SMB reflects the Company’s strong balance sheet having a core capital well in excess of minimum requirements stipulated by the CBSL.
SMB Leasing (formerly) increased its Assert Base by over 300% from Rs. 1.5 billion to 5 billion and Shareholder Funds by 200% from Rs. 1.5 billion Rs. 3 billion over the past last three years.
For budgetary purposes, raising of domestic currency debt by the Government of Sri Lanka is mainly made through, Treasury bills and Treasury bonds. At the Treasury bill issuance held on 21 December 2022, Rs. 5,510 million was raised at the Weighted Average Yield Rates of 32.23% and 29.30%. Interest rate movements in the Treasury bill market provide a benchmark for the short-term credit market. Hence, changes in the volumes and rates in the Treasury bill market affect the cost, profitability and liquidity of financial institutions.
Central Bank’s Weekly Economic Indicators showed that Weekly Average Weighted Prime Lending Rate (AWPR) for the week ending 23rd December 2022 increased by 37 bps to 28.68 per cent compared to the previous week.
Business
EU’s new anti-greenwashing rules pose major challenge for Sri Lankan exporters
Countdown to September 2026 begins
Sri Lankan exporters selling into Europe may soon face one of the most significant regulatory shifts in recent years as the European Union prepares to enforce sweeping new rules aimed at eliminating ‘misleading’ environmental and sustainability claims.
The regulation, known as the Empowering Consumers for the Green Transition Directive (EmpCo) – Directive (EU) 2024/825, will become fully enforceable across all EU member states from September 27, 2026. While the directive is primarily designed to protect European consumers from so-called ‘greenwashing,’ and it carries important implications for exporters worldwide, including those in Sri Lanka.
Compliance experts warn that many local businesses remain largely unaware of the new requirements despite their potential impact on market access, brand reputation, and regulatory compliance.
The directive introduces a simple but demanding principle: companies must be able to substantiate environmental and sustainability claims with credible evidence. Generic descriptions such as ‘eco-friendly,’ ‘green,’ ‘sustainable,’ ‘responsible,’ ‘carbon neutral,’ or ‘climate friendly’ may no longer be used freely unless they can be verified through reliable data and supporting documentation.
For Sri Lankan exporters, this represents a significant shift. Sustainability claims increasingly appear on product packaging, websites, social media campaigns, annual reports, tourism marketing materials, and corporate communications. Under the new framework, such claims could face scrutiny from regulators, consumers, retailers, and civil society groups.
The directive also places particular emphasis on future environmental commitments. Claims such as ‘Net Zero by 2040’ or ‘Carbon Neutral by 2030’ may require businesses to demonstrate clear implementation plans, measurable milestones, and systems for monitoring progress rather than relying on aspirational statements alone.
An environmental compliance expert told The Island Financial Review that this transforms sustainability from a communications exercise into a governance issue. “Responsibility will no longer rest solely with sustainability departments. Company directors, senior executives, marketing teams, procurement professionals, and compliance officers will all have roles to play in ensuring that public claims can withstand regulatory scrutiny. The potential costs of non-compliance are considerable. Under the directive, penalties may include fines of up to four percent of annual turnover generated within the relevant EU member state, restrictions on marketing activities, increased regulatory investigations, and challenges from consumer organisations and commercial partners.”
“The reputational consequences may prove even more damaging. In highly competitive export markets, trust has become a critical business asset. Companies found to be making unsubstantiated environmental claims could face long-term damage to relationships with buyers, retailers, and consumers.”
“The timing is particularly important for Sri Lankan businesses because compliance preparations, reporting frameworks and adjustments are needed before the enforcement date arrives.”
“Businesses supplying European markets are therefore being encouraged to begin assessing their exposure now rather than waiting until the last minute. Early preparation could help exporters safeguard market access, maintain buyer confidence, and strengthen their competitive position in an increasingly sustainability-conscious global economy.”
“For Sri Lanka’s export sector, the message from Europe is becoming increasingly clear: sustainability claims will no longer be judged by how compelling they sound, but by how convincingly they can be proven,” he said.
As the countdown to September 2026 begins, exporters may need to ask themselves a critical question: Are their sustainability claims ready for a new era of accountability?
By Sanath Nanayakkare
Business
University of West London opens Sri Lanka’s first full UK university branch campus
The University of West London (UWL) has formally opened the University of West London Sri Lanka Branch Campus, the country’s first full UK university branch campus, marking a landmark development in Sri Lanka’s higher education sector.
The University of West London Sri Lanka Branch Campus is designed to bring a UK university learning experience closer to students in Sri Lanka. The campus is operated by ANC Campus, a pioneer in the higher education sector in Sri Lanka with over two decades of experience in delivering internationally recognised education.
The University of West London Sri Lanka Branch Campus gives students the opportunity to study towards world-class UK degrees while remaining close to home. Academic delivery, assessment and quality assurance will be aligned with University of West London standards, with the University maintaining academic oversight of its courses and awards. Students will have access to UWL-approved programmes, academic support, learning resources and a campus environment designed to promote academic success, confidence and employability.
Business
Xiaomi Store powered by Abans opens at One Galle Face Mall
Xiaomi Sri Lanka, marked a significant day in the brand’s local journey with the launch of the all-new Xiaomi 17T and the grand opening of the new Xiaomi Store powered by Abans at One Galle Face Mall, Lower Ground.
This occasion reflects the brand’s growing presence in the country and its commitment to bringing smarter technology, connected devices and immersive customer experiences closer to Sri Lankan consumers.
Held under the theme “Step into a smarter world with Xiaomi,” the launch event welcomed media, partners, technology enthusiasts and customers to experience Xiaomi’s latest innovation and wider smart ecosystem. The new store at One Galle Face Mall powered by Abans has been designed to give customers a hands-on experience across Xiaomi smartphones, smart home products, lifestyle technology and connected devices, supported by Abans’ strong retail presence and customer service network.
Commenting on the milestone, Kain Wang, Country Head, Xiaomi Sri Lanka, said, “17th June is a significant day for Xiaomi in Sri Lanka as we celebrate two important milestones together: the launch of the Xiaomi 17T and the opening of our new Xiaomi Store powered by Abans at One Galle Face Mall. This reflects the strength of Xiaomi’s journey in Sri Lanka and our continued commitment to offering innovation, performance and smarter lifestyle experiences to local consumers. With Xiaomi 17T, we are bringing advanced Leica imaging, powerful performance and long-lasting battery life to users who want to do more with their smartphones. At the same time, our new store creates a dedicated space for customers to experience the Xiaomi ecosystem in a more personal and engaging way.”
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