Communications Department
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E-mail: dcommunications@cbsl.lk, communications@cbsl.lk
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Press Release
Issued By
Date
Economic Research Department
2009-01-27
Payment of a Bonus in Rupees on the Interest earned on Resident Foreign
Currency Accounts and Non-Resident Foreign Currency Accounts
The Central Bank has now initiated several measures to promote inward remittances and
to build the foreign exchange reserves to a higher level, as announced in the “Road Map:
Monetary and Financial Sector Policies for 2009 and beyond”. Accordingly, in order to
promote inward remittances, the Government of Sri Lanka has made necessary
arrangements to pay a bonus interest in Sri Lanka rupees on the interest paid by the
licensed commercial banks, National Savings Bank and Lankaputhra Development Bank
on Resident Foreign Currency (RFC) and Non-Resident Foreign Currency (NRFC)
accounts, with effect from 01 February, 2009. This aims to promote inflows of foreign
remittances into Sri Lanka through the banking channels as well as to promote the general
public to deposit any foreign currencies held by themselves with aforesaid banks. Such
inflows of foreign exchange into the banking system will make available more resources
for the aforesaid banks for their lending operations, thereby effectively utilising such
resources to promote investments.
The bonus so paid will be the rupee equivalent of 20 per cent of the foreign currency
interest that accrues on deposits from 01 February, 2009 onwards. For example, if an
account holder receives an interest income of (say) US dollars 100 on his RFC or NRFC
account deposit, the relevant bank will pay a rupee equivalent of US dollars 20 in rupees
as a bonus. The bonus interest will be credited to a rupee account opened in the name of
the account holder or to any other account nominated by the account holder. The bonus
interest will not be credited to the RFC nor NRFC accounts. The bonus interest calculated
using the monthly average exchange rate of the previous month published in the Central
Bank of Sri Lanka web site, will be paid to the account holder on the same day on which
the foreign currency interest is paid. Further, the interest bonus will be exempt from any
income tax deductions. The interest paid on RFC and NRFC accounts are already exempt
from taxation.