Money Changer & AML Glossary

Authorized Money Changer (AMC)

A Restricted Dealer permitted by the Department of Foreign Exchange to buy, sell and exchange foreign currency notes under section 9, read with section 4(2), of the Foreign Exchange Act, No. 12 of 2017. AMCs fall into four categories: A (companies exclusively in money changing), B (licensed finance companies and specialized banks), C (hotels graded four stars and above) and D (other entities such as retail chains). See the licence guide.

AML/CFT

Anti-money laundering and countering the financing of terrorism: the laws, rules and internal controls that stop criminals using a business to move money. For money changers the main law is the Financial Transactions Reporting Act, No. 6 of 2006.

Authorized Dealer (AD)

A licensed commercial bank authorised under section 33 of the Foreign Exchange Act to deal in foreign exchange. Money changers keep accounts with Authorized Dealers to deposit or sell the foreign currency they buy, and may not buy at rates higher than those offered by the Authorized Dealers they deposit with.

Balance Statement

A daily, monthly or periodic statement that shows, for each currency, the opening balance, purchases, exchanges, sales, deposits or sales to the Authorized Dealer, and the closing balance. The DFE requires a money changer's software to produce it.

Beneficial owner

The natural person who ultimately owns or controls a customer, or on whose behalf a transaction is carried out. Under the FIU's CDD Rules, institutions must identify and take reasonable steps to verify the beneficial owner.

CBSL (Central Bank of Sri Lanka)

Sri Lanka's central bank. Both the Department of Foreign Exchange, which permits and supervises money changers, and the Financial Intelligence Unit sit within it.

CDD (Customer Due Diligence)

The process of identifying a customer, verifying their identity and understanding the purpose of the business. Under the Financial Institutions (Customer Due Diligence) Rules, No. 1 of 2016, a money changer must carry out CDD, and obtain copies of identification documents, for money-changing transactions above Rs. 200,000 (or the foreign-currency equivalent), including linked transactions. See how FXSOFT handles CDD.

Competent Authority

The authority named in the United Nations Regulations of 2012 (the Secretary to the Ministry of Defence) that gives effect to Sri Lanka's 1373 designations and freezing orders. Under FIU Circular 01/2014, money changers notify it, as well as the FIU, of any match with a designated person.

Designated person

A person or entity named on a United Nations Security Council sanctions list or on Sri Lanka's national 1373 list. Money changers must not deal with designated persons, and must report a match.

DFE (Department of Foreign Exchange)

The department of the Central Bank that administers the Foreign Exchange Act, issues money-changing permits, publishes the Directions and Operational Guide for money changers, and supervises them, including through on-site inspections.

Dual control

The DFE's requirement that two people enter and authorise any money-changing transaction above USD 2,500 or its equivalent (Directions No. 01 of 2025, para. 9.6).

FIU (Financial Intelligence Unit of Sri Lanka)

The unit within the Central Bank that receives reports under the Financial Transactions Reporting Act, issues AML/CFT rules, circulars and guidelines, and can impose administrative sanctions for non-compliance.

Form I

The application form on which every sale of foreign currency by a permitted money changer must be made (Directions No. 01 of 2025, para. 14).

FTRA (Financial Transactions Reporting Act)

Act No. 6 of 2006, as amended by Act No. 17 of 2026. It requires institutions, expressly including those providing “money and currency changing services”, to apply a risk-based approach, carry out customer due diligence, keep records for six years, and report suspicious transactions.

KYC (Know Your Customer)

The identification part of due diligence: collecting the customer's name as on their ID, photo-ID details, address, contact and nationality, with a copy of the document. FXSOFT's customer profile holds all of these.

PEP (Politically Exposed Person)

An individual entrusted with a prominent public function, such as a head of state or government, politician, senior government, judicial or military officer, or senior executive of a state-owned body. Middle-ranking and junior officials are not included. PEPs, their family members and close associates require approval from senior management, enquiry into their source of funds, and enhanced monitoring.

Purchase Register

The register of every foreign currency purchase: date, receipt serial number, customer name, NIC or passport number, source of foreign currency, amount, rate and rupees issued. The DFE requires a money changer's software to produce it.

Restricted Dealer (RD)

Any person or class of persons permitted by the Director of the Department of Foreign Exchange to deal in foreign exchange within Sri Lanka for the purposes stated in their permit. Money changers are Restricted Dealers; the FIU addresses them by that name.

STR (Suspicious Transaction Report)

A report to the Financial Intelligence Unit when an institution suspects, or has reasonable grounds to suspect, that a transaction may be related to an unlawful activity or terrorist financing. Under section 7 of the FTRA it must be made as soon as practicable and not later than two working days after the suspicion arises.

Targeted financial sanctions

Measures that freeze the assets of, and prohibit dealings with, specific designated persons and entities, imposed in Sri Lanka through regulations made under the United Nations Act, No. 45 of 1968. A money changer must check customers against the designated lists before dealing with them. See sanction screening in FXSOFT.

UNSCR 1267 list

The United Nations Security Council's sanctions list covering Al-Qaida, ISIL (Da'esh) and the Taliban and their associates, given effect in Sri Lanka by United Nations Regulations No. 2 of 2012. Designations take effect when the Security Council announces them.

1373 list

Sri Lanka's national list of designated persons and entities under United Nations Regulations No. 1 of 2012, giving effect to UN Security Council Resolution 1373. It is published and updated by gazette through the Competent Authority.

Definitions are summaries of the official documents listed in the Regulatory Guide as at October 2026 and are not legal advice. For the authoritative wording, always read the original document.