The crime scene is less than 150m from Pangiriwatta Mawatha in Nugegoda, where the President lives. The killing took place in daylight. Smartphone footage shows a motionless man on the ground being beaten with a pole. It is rush hour. The death of Sunil Jayawardana, a 53-year-old father-of-three, who led the Lanka Self-Employed Professionals’ National [...]


Sunil’s death exposes horror of ‘goda finance’ companies

Unregulated by the Central Bank, informal lending companies are a law unto themselves

The crime scene: Sunil Jayawardana (inset) lay unconscious on the pavement outside the finance company after he was attacked by a group of 'siezures'. Pic by Indika Handuwala

The crime scene is less than 150m from Pangiriwatta Mawatha in Nugegoda, where the President lives. The killing took place in daylight. Smartphone footage shows a motionless man on the ground being beaten with a pole. It is rush hour.

The death of Sunil Jayawardana, a 53-year-old father-of-three, who led the Lanka Self-Employed Professionals’ National Three-Wheeler Association, has shaken the country. One reason is the audacity with which it was carried out. The other is because it throws light on a dilemma that affects thousands of people: The problem of “goda finance”, as it is called in Sinhala.

These informal lenders are a dime a dozen. The Central Bank of Sri Lanka (CBSL), the regulator, has long washed its hands off the sector, rationalising that the public must know to patronise only registered entities.

“Goda finance” companies are a law unto themselves. And this became all the more evident during the pandemic. The CBSL, on Government instructions, directed leasing companies to grant six-month debt moratorium on rentals of three-wheelers, school vans, lorries, small goods transport vehicles and buses and related assets such as motorbikes and taxies operated by the self-employed or owners.

Unregistered companies overwhelmingly ignored this. Mr Jayawardana was embroiled in one such dispute on behalf of an association member when he met his death. Manjula Kithsiri’s three-wheeler was seized by the leasing firm, Chanmil Investment (Pvt) Ltd, despite him having paid off his monthly instalments regularly till February.

When the pandemic struck, Mr Kithsiri was out of work. He thought he would benefit from the debt moratorium. But despite fervent appeals — and promises that he would pay when able—he was roughed up by the company’s “seizers” and his three-wheeler wrested.

“Seizers” or collectors in the informal leasing sector are a subculture that all three-wheeler associations are familiar with. The companies cultivate them with a vengeance. They are typically non-permanent staff who are paid per vehicle. The required qualifications are an ability to instil terror and, where necessary, use violence to either force payment or take away an asset.

Both methods are illegal but widely practised. Companies are expected to seek vehicle re-possession through police. This is rarely, if ever, done. And the matter only goes to police after a seizure for the purpose of recording that the relevant asset was not stolen.

Mr Jayawardana intervened in Mr Kithsiri’s matter. But the company branch at Ambuldeniya insisted that Government or CBSL directives did not apply to it. The pair then went a short distance to President Gotabaya Rajapaksa’s residence in Pangiriwatta Mawatha and secured an appointment through a coordinator there.

At the President’s Office, an official reportedly telephoned the owner of Chanmil Investment and asked him to release the three-wheeler if instalments had been paid in a timely manner up till the time the pandemic broke.

The company agreed, a spokesman for Mr Jayawardana claimed. But when they visited its Ambuldeniya branch the very next day, employees there refused to return the three-wheeler unless all dues were settled. And they again claimed that Government or CBSL directives did not apply to them.

They left the office. Mr Jayawardana, an active civil society member, was due to participate at a protest outside the Chinese Embassy later that day. But it was banned by the police so he and his friends decided “to put a drink”. Back at Chanmil Investment’s Ambuldeniya branch, a group of collectors and employees were also guzzling alcohol.

Mr Jayawardana’s decision to go back to Chanmil Investment was impromptu, his friends said. They tried to discourage him but he took association Secretary, Mahinda Kumara, and went along. Both sides were intoxicated and spoiling for a fight. When it broke out as anticipated, Mr Kumara ran after receiving a few blows but Mr Jayawardana was outnumbered and suffered the brunt of the attack. He was beaten even as he lay prostrate on the ground. And he died later in hospital.

Eight people were arrested and remanded but Mr. Jayawardana’s friends fear that, “They will catch hold of someone important and get out.” Lalith Dharmasekera, who leads the All Island Three-Wheeler Drivers’ Association, vowed it won’t be so easy this time.

“This is not a joke,” he said. “We won’t let that happen and we hope it won’t. Because if it does, all the allegations against Mr Gotabaya’s administration will be proven right. Sunil was a popular, well-known man. In my opinion, this is a litmus test for the Government.”

The issue is not new. Successive Governments have been told about the challenges — even danger — lessees were facing with unregistered companies. At the same time, people continue to use the services of these goda finance companies because it is easier, and quicker, to obtain leases from them than from the licensed sector that requires the fulfilment of more conditions and entails a stricter vetting process. Witnesses are usually optional.

“I have a lease from a renowned, registered company for which I had to sign a stack of papers which were in English,” said Rohana Perera, President of the National Joint Three-Wheeler Drivers and Industries Association. “Even goda finance companies have documents to sign and, even when they are in Sinhala, it is not in the type of language most people can understand but they initial each page—top and bottom.”

In the past, leasing companies were allowed to meet up to 75 percent of the cost of a vehicle. The Yahapalana Government changed that. Now, prospective owners have to raise 75 percent of the cost, Mr Perera said. So goda finance companies have started giving out loan-lease “packages”, also at high interest.

“It became a big chance for them,” Mr Perera pointed out. Interest computations are also shrouded in “secret” formulas which result in the effective rate being far higher than what the lessee is told he will be charged. And late instalment payments result in punitive fines — all of which are unregulated.

“If the Government wanted to discourage leases for three-wheelers on the basis that there were too many, it should have merely taxed the vehicles more, so they become more expensive,” Mr Perera said. “We suggested that because, with more than a million threewheelers on the road, even we are not making gains. The method they chose only gave rise to a different set of issues.”

Professional three-wheeler practitioners — as they wish to be called — have separately been pushing for regulation of their own sector.

“There are 28,000 thousand buses in Sri Lanka, both public and private,” Mr Perera said. “To regulate them, there are nine Transport Ministers in the nine Provincial Councils. There is one Central Government Minister and State Minister and officials as well as various other bodies. There is not a single institution, official or Minister to regulate 1.3mn three-wheelers.”

Sick of waiting, sector representatives worked with the National Transport Commission and drew up a draft policy that envisaged the Provincial Councils regulating three-wheelers. It was given to Transport Minister Mahinda Amaraweera but “he sat on it, till Parliament was dissolved”.

Recently, a “big letter” outlining all their issues and making proposals was handed over to everyone from the President (through the Kotte Mayor), the President’s Secretary and the Inspector General of Police to the Defence Secretary and Basil Rajapaksa, who heads the Presidential Task Force on Poverty Eradication and Economic Revival.

Nobody responded. But this week, after Mr Jayawardana’s death, the President ordered police to stop leasing companies from re-possessing vehicles of those who had missed their lease instalments. He also pointed to a circular issued on March 23, mandating, among other things, a six-months suspension of lease payment recoveries.

Transport Minister Mahinda Amaraweera also issued a statement. He acknowledged that Mr Jayawardana had spoken on behalf of the three-wheeler professional several times during meetings.

“At no time did he expect anything from the Government for this industry,” he said. “He only wanted protection for his membership from the difficulties they face on the roads and for a background to be created in which they could practise their profession with ease.”

What he didn’t say in his communique was that successive administrations, including his own, had failed to provide that foundation — and may continue to fail once Mr Jayawardana’s death fades from memory.

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