Lending rates fall to four-year lows, credit cards stay put near 28% cap

Thursday, 2 April 2026 05:45 - - {{hitsCtrl.values.hits}}

AWPR drops from 24.82% in 2023 to around 9% by early 2026
Credit card rates remain largely unchanged from crisis period at 26-28% despite easing cycle

Sri Lanka’s lending rates have retreated sharply from crisis highs, but credit card interest remains anchored near the regulatory ceiling, exposing a widening disconnect in monetary transmission.

Data from the Central Bank of Sri Lanka (CBSL) show the Average Weighted Prime Lending Rate (AWPR) has fallen from 24.82% in January 2023 to 8.88% by end-January 2026, after easing to 11.91% in 2024 and 8.56% in 2025. However, by the week ending 27 March, the AWPR has edged up slightly to 9.28%.

In contrast, interest rates on credit cards continue to range between 26% and 28%, remaining close to the ceiling imposed by the CBSL in August 2023, which capped rates on outstanding balances at 28%.

In January 2022, just before Sri Lanka’s sovereign default, the AWPR stood at 8.52%, broadly in line with current levels. Yet, while benchmark lending rates have effectively returned to pre-crisis levels, consumer credit pricing has not followed, burdening households that are caught in the credit trap.

The persistence of elevated credit card rates suggests limited pass-through of easing monetary conditions to unsecured lending, even as the CBSL has signalled expectations of further moderation in overall lending rates in 2026.