By The Pulseline News Desk
State-owned People’s Bank has stated an exchange rate error in one of its remittance platforms which led to certain customers receiving excess payments over a period of nearly three years, with the estimated financial impact amounting to about Rs. 656 million.
In a statement, the state-owned bank said the issue stemmed from the application of incorrect exchange rates for one currency within a specific remittance system, affecting transactions processed between May 2023 and March 2026.
The bank noted that the discrepancy was identified recently and has since been fully corrected.
Following the discovery, People’s Bank said it initiated an internal investigation, enhanced operational safeguards, and began consultations with regulatory and supervisory authorities, including the Central Bank of Sri Lanka (CBSL).
The lender said the estimated loss of Rs. 656 million has already been fully accounted for in its financial statements and that no additional financial exposure is anticipated.
People’s Bank added that recovery action has commenced in relation to the affected transactions, with progress already made in reclaiming funds from relevant customers.
Seeking to reassure depositors and clients, the bank said its daily operations, digital banking services and customer deposits remain secure and unaffected by the incident. It also noted that the issue does not materially impact on the bank’s overall financial position, citing a total asset base of around Rs. 3.8 trillion.
Industry observers say banks in emerging markets often struggle to modernise treasury and remittance infrastructure quickly enough to keep pace with evolving digital payment systems and volatile currency markets.
Sri Lanka’s rupee experienced dramatic swings during the 2022 economic crisis after the country abandoned a tightly managed exchange rate regime, causing severe disruptions across trade, banking and consumer markets. Although currency volatility has eased since then, financial institutions continue operating in a highly sensitive exchange environment where pricing accuracy is critical.
The latest loss may also draw attention from regulators seeking to strengthen confidence in Sri Lanka’s financial sector as the country works through reforms tied to its International Monetary Fund (IMF) programme.
Banking sector analysts say the reputational impact could ultimately prove more damaging than the direct financial loss itself.
For now, the incident stands as another reminder that in a fragile post-crisis economy, even technical financial errors can carry significant institutional and political consequences.
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