Though many people place their money in savings and fixed deposits, there are many other fixed-income securities available to investors, including Treasury bills and bonds (Government-guaranteed instruments with fixed interest rates), Debentures/bonds ( Medium and long-term instruments issued by companies and banks, with fixed or variable interest rates) ,Promissory notes( Short-term instruments issued by corporate, with fixed interest rates).

Credit-rating agencies, such as RAM Ratings, provide investors with independent opinions on the risk associated with institutions or instruments, be they banks, finance companies or debentures. The assigned rating indicates the ability and willingness of particular institutions to repay investors, together with the promised interest, on a timely basis. Investors can use this rating to determine the level of risk associated with such investments and can therefore decide the d are willing to accept in earning the required returns.

It is important to note that credit ratings are not equal to the same as recommendations to buy or sell securities, nor are they a guarantee against default. Rather credit ratings are relative rankings they represent the credit worthiness of an institution or issuer in relation to another, noted Thamotheran.

Credit ratings are provided by agencies that are registered and regulated by the Securities and Exchange Commission of Sri Lanka; RAM Ratings is one such agency. RAM Ratings is also endorses by the Central Bank of Sri Lanka and the Insurance Board of Sri Lanka, stated Prakash Jerome, Financial Analysis RAM.

Ratings are accompanied by an outlook, which specifies the likely direction of the ratings. A "positive" outlook indicates that a rating may be raised while a "negative" outlook indicates that a rating may be lowered. The ratings can be placed on a positive or negative outlook from six months to two years.

A rating is placed on Rating Watch when identifiable events are expected or have occurred. However, it does not mean that the existing rating will be changed. It only means that a rating is under evaluation by RAM Ratings and a final affirmation is expected to be announced in the near future. Rating watches too can be positive or negative. However, the time horizon is up to six months. In addition, when there is insufficient information and RAM Ratings believes that the event can impact on the rating, the rating can be placed on a "developing watch".

An issue rating refers to the credit risk of a debt instrument, where as an entity rating denotes the credit risk of an entity or cooperates. Depending on the type of underlying terms of issue, the instruments rating can defer from that of the entity, stated Jerome.

Primary issues of debentures or bonds are advertised in the media, similar to an initial public offering of shares. Listed debentures or bonds (already issued) can be purchased from the Colombo Stock Exchange (CSE) via stock brokers. On the other hand, promissory notes can be bought from leasing companies that generally issue these short-term papers.