Sri Lanka’s Unit Trust Industry Aims to Transform Saving Habits Amid Rapid Growth

The Unit Trust Association of Sri Lanka (UTASL) has ushered in a new era with the appointment of its 2025 leadership team, headed by veteran finance professional Christine Dias Bandaranaike of JB Financials Pvt Ltd as President. This leadership transition comes at a time of tremendous growth for the industry, with unit holder numbers surging 119% from 52,402 in 2020 to 114,898 in 2024, while assets under management have increased 172% to reach Rs. 547 billion during the same period.

The newly elected team includes respected industry figures such as Kavin Karunamoorthy of First Capital Asset Management as Vice President, Jeevan Sukumaran of Senfin Asset Management as Secretary, and Asanka Herath of Lynear Wealth Management as Treasurer. Sri Lanka’s unit trust sector has shown remarkable resilience and expansion over the past five years (since 2020).

Christine Bandaranaike, whose career spans nearly three decades in capital markets and fund management, explains this growth trajectory: “We’re witnessing a fundamental shift in Sri Lanka’s financial behaviour. The pandemic accelerated digital adoption, with online platforms making unit trusts more accessible than ever. Meanwhile, younger investors – particularly millennials and Gen Z – are driving demand as they seek alternatives to traditional savings that can’t keep pace with inflation rates.”

Sri Lanka’s harsh economic realities have created a demand to move beyond conventional savings accounts and fixed deposits. “For generations, Sri Lankans trusted savings accounts as the safest option,” notes Bandaranaike. “But when inflation consistently outpaced interest rates, these traditional methods quietly eroded purchasing power. The money might be safe in the bank, but its real value is disappearing fast. This is known as benign neglect. We are championing a vibrant and inclusive unit trust industry in Sri Lanka by advocating for investor protection, promoting financial literacy, fostering innovation, and ensuring regulatory excellence by empowering individuals and institutions to achieve long-term financial well-being through trusted collective investment solutions.”

The rapid expansion of Sri Lanka’s unit trust industry highlights its ability to meet modern financial realities. In contrast to fixed deposits that often may fail to keep pace with inflation or real estate investments that demand significant capital, unit trusts offer low entry thresholds (from just Rs. 1,000), daily liquidity, and professional portfolio management.

Over the past five years, the CSE All Share Index (ASPI) delivered a compounded annual growth rate (CAGR) of over 21%, despite volatility. An investor placing Rs. 100,000 in an equity-based unit trust in 2020 would have grown their capital to around Rs. 260,000 by end-2024.

In contrast, a fixed deposit earning the average AWFDR of 11.14% over the same period — including the unusually high rates seen in 2022–2023 due to the economic crisis — would yield only about Rs. 170,000. Even with those elevated rates, equity investing outperformed. The message is clear: disciplined, long-term investing builds real wealth.

Looking forward, the UTASL is committed to accelerating this financial shift by deepening collaboration with regulators, expanding access to investment tools, and leading a nationwide drive for financial education. “Our goal is simple,” states Bandaranaike. “Help Sri Lankans move from a culture of saving to a mindset of growing. We need to empower individuals to make informed, long-term decisions about their money.”

The Unit Trust Association of Sri Lanka remains dedicated to building a secure, inclusive, and performance-driven investment landscape, ensuring every Sri Lankan has access to trusted, regulated, and inflation-beating investment solutions.