Sri Lanka e-visa operations are under scrutiny following a critical audit that highlighted revenue discrepancies in the outsourced system. VFS Global has issued a statement asserting cooperation and urging fair evaluation.
Audit findings raise questions about Sri Lanka e-visa revenue, prompting VFS response
Sri Lanka’s e-visa outsourcing contract has come under intense public and regulatory review after a special audit report revealed significant concerns about how funds collected from travelers were handled. The National Audit Office reported that the VFS-IVS-GBS consortium, which operated the digital processing system for the Department of Immigration and Emigration, failed to remit over 1.2 million dollars in value-added tax and more than 127,000 dollars in social security levy payments to the government.
The report also uncovered cases where extra charges were applied to tourists who were supposed to be exempt from certain fees. Hundreds of travelers from SAARC countries, who should have received reduced visa rates, were instead overcharged. Investigators found mismatches between the number of visas issued and the total sums transferred to the state, raising additional concerns about transparency and controls within the outsourced process.
These revelations come at a sensitive time as Sri Lanka seeks to strengthen tourism revenue and enhance international trust after recent economic setbacks. Efficient and fair border processes are seen as crucial for rebuilding the hospitality industry, a sector considered one of the country’s strongest engines for recovery.
In response to the audit, VFS Global released a detailed statement asserting that it has always remained willing to cooperate fully with government investigations. The company said it contacted the Auditor General’s Office in November 2024 to offer documentation and assistance but did not receive a reply. VFS emphasized that it stands ready to support any authority in Sri Lanka as required.
The organization clarified that its involvement in the Sri Lanka e-visa initiative is limited to technical and administrative functions. Decision-making authority, including assessment and approval of applications, rests entirely with government officials. According to the company, its operations follow strict service agreements established by client states, and similar frameworks are used in more than 165 countries where VFS partners with 69 governments.
The outsourcing agreement in question was signed on December 21, 2023, involving VFS Global and the prime contractor IVS-GBS. The contract came under severe criticism shortly after implementation due to higher-than-expected charges and additional fee layers applied to travelers. These concerns eventually led to legal intervention, and a court-ordered suspension halted elements of the visa service on August 2, 2024.
Public debate escalated as travelers and industry groups argued that the updated fee structure damaged Sri Lanka’s appeal during a crucial period of tourism revival. Visa costs for some travelers more than doubled compared to previous levels, creating an affordability barrier and stirring frustration among frequent regional visitors.
The audit report reinforces those complaints, stating that differences between collected fees and reported remittances must be closely examined. The document suggests that inadequate monitoring allowed revenue leakages that could have harmed national income at a time when finances were already strained.
VFS Global stated that because the matter is currently under judicial consideration, it has been advised to limit its remarks to official forums. The company maintained that it has complied with Sri Lankan regulations in good faith and dismissed any suggestion that it intentionally withheld funds.
While legal and procedural reviews continue, government authorities are under pressure to rebuild confidence in digital border management. Officials have repeatedly acknowledged the importance of transparent, predictable systems that treat visitors fairly and safeguard national revenue. Efforts to expand visa-free entry to boost arrivals have also encountered legal delays related to the previous outsourcing structure.
Tourism analysts note that modernized digital entry systems are essential for competitiveness, but outsourcing requires strong oversight to prevent operational conflicts and undue profiteering. They argue that Sri Lanka has a valuable opportunity to refine its e-visa experience, making it faster and more secure while protecting the public interest.
The outcome of this controversy may shape future policy on how digital immigration services are managed. Travelers, businesses, and policymakers are watching closely to see whether reforms will prioritize accountability and efficiency as Sri Lanka positions itself for sustained visitor growth in 2025 and beyond.