Colombo, April 3, 2025: In a strategic move to promote cashless transactions, HNB has announced the elimination of Merchant Discount Rates (MDR) for LANKAQR transactions among HNB appointed merchants who are enabled to accept LANKAQR payments. This initiative aims to make digital payments more accessible and cost-effective for businesses across Sri Lanka.
Taking a leap into digitalizing the retail payment space, Central Bank of Sri Lanka (CBSL) together with LankaPay launched LANKAQR in 2020 as a convenient, secure and low-cost alternative for merchant payments with the objective of simplifying digital transactions and promoting financial inclusivity. LANKAQR is an interoperable quick response code which complies with EMVCO international standards which enables a customer to scan and pay at LANKAQR merchants using any LankaQR enabled mobile app. Currently there are 22 LANKAQR merchant acquirers and 30 LANKAQR enabled mobile apps operating in the country. By Q3 2024, there were over 410,000 LANKAQR merchants island wide.
This initiative is being introduced by HNB in a timely manner specifically targeting the start of the Avurudu season will be initially valid for three months from 1st April to 30th June 2025 to encourage digital transactions during a period of increased footfall and transaction volume. By eliminating cash handling, both merchants and customers benefit from a seamless and convenient payment experience.
Speaking at the event, HNB MD/CEO Damith Pallewatte said, “We’ve disrupted the market today with our QR solution. We’ve clearly understood what’s needed to bring all merchants into the digital ecosystem. We’re proud to have the largest network of merchants—creating traceability and access to banking systems that enable them to scale their businesses.
This not only opens up opportunities for growth but also helps manage costs more effectively. We recognize the hesitation that some may feel, particularly regarding onboarding costs. However, our goal is to build both awareness and value around this platform.
We encourage you to come onboard—exciting developments are on the horizon over the next three months.”
Being a HNB Merchant, backed by LankaPay integrated LANKAQR ecosystem, facilitates interoperable QR-based transactions. The initiative will greatly benefit more than 30,000 HNB appointed LANKAQR merchants who are in a position to accept QR based payments facilitated through 30 Bank and Fintec payment apps and Wallets including SOLO by HNB. By removing MDR fees, HNB seeks to encourage greater adoption of digital payments among all merchants especially for small ticket payments eliminating cash
“It is necessary to promote digital payments in the country, as a significant number of transactions are already taking place through these platforms. As the Central Bank, we are committed to supporting and promoting such initiatives and campaigns.
We encourage all banks to come onboard and adopt similar efforts, as this will play a crucial role in uplifting the economy and advancing the country.” said Vasantha Alwis, Director – Payments and Settlements, Central Bank of Sri Lanka.
The LankaPay integration with India’s Unified Payments Interface (UPI), China’s UnionPay, and Alipay enables seamless cross-border transactions, benefiting both local businesses and international visitors. This integration allows UPI, UnionPay, and Alipay-enabled app users, particularly Indian and Chinese tourists visiting Sri Lanka, to make payments through these digital apps at Sri Lankan merchant points, especially in tourist hotspots across the country. It also encourages local merchants to adopt digital payment methods, enabling them to attract higher volumes of business from these digitally savvy customers, who are accustomed to high digital payment adoption in their home countries.
Merchants can accept payments via static and dynamic QR codes with real-time settlements, enhanced security, and zero processing fees. The 0% MDR offer from HNB is applicable only for transactions below Rs. 10,000. Transactions exceeding this amount will continue to incur standard MDR charges.
HNB encourages businesses to register to accept LANKAQR payments to take advantage of this cost-free payment solution and contribute to the growth of digital transactions across Sri Lanka.
