Sri Lanka will issue new rules covering financial transactions through mobile phones, Central Bank Governor Nivard Cabraal said, as the island’s fast growing celcos join banks to offer new payment methods.

"Given the increased usage of mobile phones for financial transactions, the Central Bank intends to issue new operating guidelines for mobile payments during 2009," Cabraal said in an annual policy speech Friday.

He said the move was part of an overall effort to improve the confidence in electronic payments, which would also cover payment cards.

"The draft regulations on service providers of payment cards, giving specific powers to the Central Bank to regulate and supervise such service providers, would also be implemented to enhance the public confidence in electronic payments."

Several Sri Lankan banks have tied up with mobile phone companies to launch payment services for m-commerce.

State-run Bank of Ceylon launched a payment system based on text messages developed by India’s PayMate. The bank said it would have point-of-sale terminals based on mobile devices which could eventually overtake even traditional credit cards.

Dialog Telekom and NDB Bank launched a service called mCheck, which can be used to settle utility bills, engage in mobile banking or top up pre-paid phone cards.

Commercial Bank also has a service branded Com-e-load which offers bill settlement of a number of telecom operators and other facilities.

Other banks including Seylan have also tied up with mobile operators to offer mobile transactions.