The company, which is jointly owned by the Central Bank and local commercial banks, says the national payment switch will carry out transactions at a nominal cost to banks and consumers.
"We are looking at considerably reducing transaction costs," said Sunimal Weerasooriya, General Manager/Chief Executive Officer, LankaClear.
Few of the some 2,500 automatic teller machines (ATM’s) spread across Sri Lanka, allow customers to operate their accounts via multiple commercial banks.
Those that offer the service, charge between 30 rupees to about 60 rupees, as the transaction is routed via the local banks and a foreign payment settle system.
"The common switch will create a platform that facilitateslocal payment card transaction process and save a considerable amount of foreign exchange to the country," Weerasooriya said Thursday.
The switch would be implemented in three phases. Under the first phase, a common ATM switch will be implemented. Phase two will see a mobile payment and Electronic Fund Transfer switch.
In the final phase, the company hopes to deploy a common point-of-sale switch, Weerasooriya said.
The company is investing its own money into the new system, using the revenue they earn from charging a flat fee of 2.50 rupees a transaction for all their services.
Work has already begun and the switch is due to be ready to link-up with banks by the end of this year.
Established in 2002, LankaClear currently clears about 30 billion rupees worth of cheques daily, while about 3.0 billion rupees worth of transactions take place daily through the Sri Lanka Interbank Payment System (SLIPS), said Harsha Wanigatunga, head of operations.
Chairperson Priyantha Liyanage said they were also looking at setting up a regional payment switch to South Asian neighbours. Currently, Malaysia has a similar model to enable customers to transact within ASEAN countries at lower costs.