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Sri Lanka stock market goes fully digital, drops physical documents

ECONOMYNEXT – Sri Lanka’s Securities and Exchange Commission said it had given the nod for rules allowing paper contracts on Colombo Stock Exchange trades to be discontinued and new depository accounts to be opened online without going to broker offices.

“Under the amended rules, Statement of Accounts and Bought and Sold Notes sent by stock broker firms to their clients, and CDS monthly statements sent to account holders will be converted from paper based hard copies to electronic format,” the SEC said in a statement.

“The rule amendments will facilitate the Listed Companies to send Annual Reports to their shareholders in a mode other than in printed form and the payment of dividends through electronic bank transfers.”

The changes were proposed by a SEC – CSE joint committee involved in digitization

“Under this initiative, an online account opening process would also be facilitated whereby an investor could open a CDS (central depository system) Account, start trading and make settlements electronically without the need to physically visit an office of a stock broker.”

Sri Lanka already has internet based trading for stock market investors but settlement documents and cheques are sent by post.

SEC urged stock investors to give their bank account numbers, email addresses and mobile numbers to brokers to get cash and settlement information.

Companies could then also send financial statements online and electronically pay dividends. (Colombo/June03/2020)