The Central Bank of Sri Lanka (CBSL) clarified that authorizing the Indian Rupee (INR) as a designated currency does not make it legal tender in Sri Lanka for domestic payments.
The purpose is to promote trade and investment relations with India, reduce transaction costs, and support formal banking channels.
Sri Lanka’s legal tender for domestic payments will remain the Sri Lankan Rupee (LKR).
The CBSL has authorized 16 designated foreign currencies since May 1979, including the INR since August 2022. This move aims to facilitate smooth banking transactions, encourage formal trade channels, and provide convenience to Indian tourists in Sri Lanka.