Business

Banks assure educational payments ‘top priority’ 

By Yakuta Dawood

Licensed commercial banks (LCBs) assured that they were doing their best to permit foreign exchange payments for education purposes, while parents and students continued to complain that LCBs were not giving the green light for such payments.

Speaking to us, Sampath Bank PLC Senior Deputy General Manager – Operations and Group Chief Marketing Officer (CMO) Tharaka Ranwala stated that the issue arose as some parents had not used the correct methodology set by the Central Bank of Sri Lanka (CBSL) when paying in dollars for educational purposes.

Explaining further, he stated that parents are required to open a “Student File” that contains all the required information of the student, college, and payment. However, some parents had not adhered to this process, as they paid the initial fee to the college and gave a debit card to their children, who could later withdraw cash from the country they were studying in. 

“In a crisis like this, when banks decide that debit card outflows are to be limited – i.e. for example, to only $ 100 per week or $ 500 per month – a problem arises for students not registered under the Student File,” Ranwala said.

He said that permitting dollar payments for educational purposes was one of the priorities of Sampath Bank, which is why students registered under the Student File get their dollars on time. 

Adding, Ranwala stressed that parents needed to understand the current situation where there is an issue in allocating funds. He suggested they gradually overcome the obstacles by planning well in advance of the last day the educational payment is due, rather than demanding dollars for SWIFT payments at the last minute. 

“Banks can only pay out dollars depending on their inflow,” he added.

Speaking to The Sunday Morning Business, Commercial Bank of Ceylon PLC Chief Financial Officer (CFO) Nandika Buddhipala stated that the bank allows sending TTs (telegraphic transfers) for educational purposes, as it is one of the main priorities of the bank.

“According to the availability of dollars, we are facilitating the payments,” Buddhipala said.

Another senior official from Bank of Ceylon (BOC), who wished to remain anonymous, stated that even if other banks were unwilling to provide dollars, BOC was obligated to do their best to allocate funds for educational purposes, as it is a government bank.

Continuous attempts to contact People’s Bank, National Development Bank PLC (NDB), and DFCC Bank proved futile.

Meanwhile, responding to complaints received by parents, Central Bank of Sri Lanka (CBSL) Governor Ajith Nivard Cabraal, earlier this month, instructed all commercial banks to release US dollars for students who were travelling overseas for higher education.

Accordingly, as per a media release in April 2020, family members residing in Sri Lanka were permitted to send money from Sri Lanka to persons who went abroad for studies through an authorised dealer (AD) in foreign exchange (any LCB or a permitted licensed specialised bank) upon submitting the relevant documentary evidence as usually required by ADs.

Furthermore, such persons could also use their credit, debit (ATM), and foreign travel cards issued to them by ADs for payments or cash withdrawals/obtain cash advances in foreign currency during their stay abroad in respect of transactions of a personal nature.

“The CBSL wishes to reiterate that there is no hindrance to providing any additional financial assistance to the above-mentioned categories of Sri Lankans currently abroad, to meet their basic needs at this time of difficulty,” the press release of April 2020 stated.