Money Broking Industry

Authorized Money Brokers (AMBs) are regulated under the Money Broking Regulations No. 1 of 2018 and the Money Broking Regulations No. 1 of 2019 issued under Section 10 (c) of the MLA, No. 58 of 1949. These regulations came into effect from 5 March 2018 and 14 February 2019, respectively. The purpose of regulating AMBs is to obtain information on the efficiency of price discovery in the sub sectors of the money market for market analysis and policy actions. This is important since developments in the money market have a direct bearing on the CBSL policies.

Two supervisory methods are applied for this purpose. Under the off-site surveillance (continuous supervision), AMBs are supervised through information obtained via on-line and off-line methods. The second method is on-site surveillance, where CBSL staff visit the premises of AMBs to check whether they have complied with the regulations in force. Each AMB is supervised on -site at least once a year.

AMBs act as intermediaries in money, foreign exchange and government securities markets. They facilitate transactions between Participating Institutions by providing bids and quotes. AMBs income is the brokerage charged from the two parties involved in the transaction.