Central Depository Systems (Pvt) Ltd (CDS), a wholly owned subsidiary of the Colombo Stock Exchange (CSE), has surpassed a significant milestone with the total number of registered CDS accounts exceeding one million, underscoring the rapid expansion of Sri Lanka’s retail investor base and the growing digitalisation of the country’s capital market infrastructure.
The milestone comes as CDS approaches its 35th anniversary in September 2026, marking three and a half decades of providing the depository infrastructure that underpins Sri Lanka’s stock market. Since its establishment in 1991, CDS has maintained the distinction of being the first central securities depository in South Asia, playing a critical role in facilitating the secure electronic holding and transfer of securities.
In its core capacity as a depository, CDS is responsible for maintaining securities in electronic form on behalf of investors. These include shares, debentures, corporate bonds and investment fund units, ensuring the safekeeping and efficient settlement of transactions within the market.
Market analysts note that the crossing of the one million account threshold reflects a broadening of Sri Lanka’s retail investor segment, particularly over the past five years. This expansion has been largely driven by the comprehensive digitalisation initiatives undertaken by the CSE, which have improved accessibility to capital market participation across the country.
Digital platforms such as the CSE Mobile App and the “CDS e-Connect” portal have transformed the way investors interact with the market. The portal, originally introduced in 2016 and revamped in 2021, offers a range of services including client profile management, real-time balance and transaction viewing, eNomination facilities, monthly statements, and dividend payment history tracking.
Additionally, CDS has strengthened transparency and security through the introduction of eStatements and SMS alerts, while the decentralisation of account opening processes and online onboarding facilities introduced in 2020 have simplified what was once a largely paperwork-driven process.
A key milestone in CDS’s evolution was the 2011 full dematerialisation drive, aimed at reducing reliance on physical share certificates that were vulnerable to loss, damage, or forgery. Today, the impact of that initiative is evident, with 97% of listed equities and 100% of corporate debt securities now maintained in scripless electronic form.
The CDS Central Control Unit continues to oversee the integrity of the system by ensuring compliance with regulatory and operational standards, while proactively identifying financial, operational and market risks to maintain investor confidence.
Beyond its core depository role, CDS has also broadened its service portfolio through the Corporate Solutions Unit (CSU), established in 2017. The unit has expanded registrar and corporate action services following the strategic acquisition of the PW Corporate Registrar arm, enabling CDS to manage services for both listed and unlisted companies.
The CSU now provides a range of issuer services including dividend distribution, rights issues and electronic applications for Initial Public Offerings (IPOs). Its digitisation initiatives such as eDividend payments, eWarrants and eNotices have further streamlined corporate action processes while enhancing convenience for shareholders.
Looking ahead, CDS has placed increasing emphasis on innovation through its newly established Research and Development Unit, which functions as a project management office tasked with developing new digital services and fostering international collaborations to strengthen Sri Lanka’s market infrastructure.
Commenting on the organisation’s strategic direction, Head of CDS Nadeera Athukorale said the institution is focused on balancing its traditional depository role with expanded registrar and consultancy services.
“By balancing its core depository duties with non-core registrar and consultancy services, the CDS has positioned itself for long-term sustainability and industry leadership,” he noted.
The milestone of one million CDS accounts highlights the increasing participation of individual investors and reflects the resilience and adaptability of Sri Lanka’s capital market infrastructure, reinforcing CDS’s role as a critical backbone of the country’s evolving investment landscape.
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