In My View Point with Thilini Gunasekera

CBSL...BLOCKCHAIN AND SHARED KYC PLATFORM!!

A new concept is being pitched by the CBSL named as the “Blockchain based shared KYC Platform”. This will enable a more efficient and effective financial inclusion.
This will be beneficial in streamlining the existing process on onboarding customers and providing a “Digital and Remote” onboarding of new customers. This concept will also reduce the legal burden to be borne by the financial institutions as well.

The CBSL has asked some IT companies for a Proof of Concept(PoC). According to the context literature on Blockchain technology, it is known as a vital feature used in every nook and corner of the world. However, this is challenging because of the privacy issues by the financial institutions.

This can be implemented as a centralized approach or decentralized approach. In the centralized approach, strong significant amount of information can be shared on the blockchain or have one or more off- chain data silos verified through the blockchain. In the decentralized approach, customer has the sole control of data but can be issued with a credential.

Several banks have showed the support to share the KYC platforms. This is also a method to tackle fraudulent transactions and Money Laundering and other illegalities such as TF.

TESLA...HAS DONE IT....

“ Tesla” became the most valuable carmaker overtaking Toyota.
The shares has been recorded high and electronic carmaker’s market capitalization overtook Toyota as well.
Investor confidence has been surged since the start of 2020 as there’s elevation in demand for electric vehicles.
According to Reuters, Tesla is now worth more than triple the combined value of U.S. automakers General Motors Co and Ford Motor Co.

Tesla’s shares gained 5% to a record of $1,133, increasing the company's market cap to $209.47 billion.

CBSL AND THE HELICOPTER DROP

CBSL focus on shifting towards a new trend called “Helicopter Drop”. They are taking extensive measures and strategies for the revival of the economy and focus on economic growth after the Covid 19 pandemic hit the SL economy heavily.

The Helicopter drop is a respond to the financial crisis in an economy in order to stimulate the real economy. Several central banks including ECB have taken this measure in the past during the 2008 financial crisis to revive the affected economies.

This is a monetary stimulus strategy and an expansionary fiscal policy which increases the money supply of an economy. This method is different from the Quantitative Easing(QE) which is basically the purchase of govt. bond/other securities to spark economic growth.

In my point of view, the Helicopter Drop doesn’t create any debt and interest rates remained unchanged as this method will boost the economic growth due to the increased demand by the public. However, according to my insights, this will further devalue the rupee as the money supply increases. This will lead to imports becoming more expensive for the importers. This may also lead to over- inflation and the regulators and the officials may need to carefully look into managing this regime appropriately.