To help the crisis-stricken country restructure $42 billion (£33.2 billion) in domestic debt, Sri Lanka declared a five-day bank holiday on Thursday.
This comes after it received $700 million in aid from the World Bank.
Since gaining independence from the British in 1948, the country has never been in such a dire economic state.
Concerns have been raised that the government's reorganization plan may cause financial market instability.
Analysts, according to reports in the local media, said the holiday was scheduled to calm markets after major financial disclosures.
Repayment schedules of loans may be adjusted as part of a debt restructuring.
Sri Lanka's President Ranil Wickremesinghe has promised the public that the country's financial sector will not collapse as a result of the reform.
On Wednesday, Mr. Wickremesinghe's office announced that the cabinet had agreed to a reorganization plan put out by the central bank. Over the weekend, the proposal will be presented to parliament for final approval.
"(The) government expects the entire process to conclude while the markets are closed during these five days," Nandalal Weerasinghe, governor of Sri Lanka's central bank, said.
For his part, Mr. Weerasinghe reassured local depositors that their money would be secure and that their interests would not be jeopardized.
As the country struggles to recover from its worst economic crisis in decades, a decision has been made to restructure domestic debt.
For the first time since gaining independence, Sri Lanka missed a payment to its international lenders last year.
However, the country has been thrown numerous crucial lifelines in the past few months.
The World Bank loan comes after the IMF provided a $3 billion rescue package.
On Thursday, the World Bank announced that it would help in a "phased approach."
The remaining $200 million would be used to "provide better-targeted income and livelihood opportunities to the poor and vulnerable," the organization said.
Why is Sri Lanka in such disarray?
The issue as described by Sri Lanka's central bank
Sri Lanka desperately needed the IMF loan that finally came through in March after nearly a year of negotiations.
The bailout, however, came with strings attached, such as the need for "swift progress" in debt restructuring.
In March, the IMF confirmed that Sri Lanka had received finance guarantees from all of its key creditors, including China and India.
Approximately $330 million in aid has been disbursed so far by the IMF, with the remaining amount to be paid out over the next four years.
The Financial Meltdown
The epidemic, rising energy prices, populist tax cuts, and inflation of over 50 percent have all taken a significant toll on Sri Lanka's economy.
The rising expense of life was exacerbated by a lack of medical supplies, petrol, and other necessities, leading to widespread protests that ultimately toppled the government in 2022.
Earlier this year, the central bank of Sri Lanka detailed the severity of the country's economic situation.
The current annual report blames "several inherent weaknesses" and "policy lapses" for the country's dire economic situation.
The Sri Lankan economy is expected to contract by 2% this year and grow by 3.3% in 2024, according to the country's central bank.
The IMF predicted 1.5% economic growth for Sri Lanka in 2019, therefore its prognosis is more optimistic.