Sri Lanka

Money terms, in plain language

Every acronym and bit of jargon we show, explained without the finance-speak. The same definitions pop up right where the term appears across the site — this is just the full list.

AER · Annual Effective Rate: The yearly return with compounding included, so you can compare deposits fairly no matter how often they pay interest (monthly, at maturity, and so on).
Annual fee: What the bank charges each year to hold the card. Many cards waive it for the first year, or once you spend above a threshold.
APR · Annual Percentage Rate: The yearly cost of a loan as a percentage — the headline number to compare borrowing across banks.
ASPI · All Share Price Index: The Colombo Stock Exchange’s main index — the combined value of every listed company. Rising means the market overall is up.
AWCMR · Average Weighted Call Money Rate: The rate banks charge each other for overnight loans — the most immediate signal of how tight or loose money is.
AWDR · Average Weighted Deposit Rate: The average interest banks are currently paying across all deposits — a rough sense of what savers earn.
AWFDR · Average Weighted Fixed Deposit Rate: The average interest banks pay specifically on fixed deposits — a benchmark to compare an individual FD rate against.
AWPLR · Average Weighted Prime Lending Rate: The average rate banks charge their most creditworthy borrowers. Loan rates broadly track it, so it signals where borrowing costs are heading.
Broad money (M2b): The total money circulating in the economy — cash plus bank deposits. Rapid growth can fuel inflation.
Buy vs sell: Rates are shown from the bank’s point of view. "Buy" is what the bank pays you for foreign currency — use it when converting dollars to rupees. "Sell" is what it charges you to obtain foreign currency — converting rupees to dollars.
CCPI · Colombo Consumer Price Index: The main gauge of inflation — how fast prices are rising for a typical basket of goods and services in the Colombo area. "Year-on-year" compares against the same month a year ago.
Core inflation: Inflation with volatile food and energy prices stripped out. It shows the underlying trend without the month-to-month noise from things like vegetables or fuel.
EPP · Easy Payment Plan: Splitting a purchase into equal monthly instalments at 0% interest using your credit card — you repay the price over several months with no added interest.
Fixed vs floating: A fixed rate stays the same for the life of the loan. A floating rate moves with a benchmark (like the AWPLR), so your repayments can rise or fall over time.
Foreign transaction fee: An extra charge (a percentage of the amount) when you pay in a foreign currency or abroad — including many online purchases from overseas sites.
Government debt: The total the government owes, split into domestic and foreign. Its rapid rise — foreign debt especially — led to the 2022 default.
NCPI · National Consumer Price Index: The same idea as the CCPI, but measured across the whole country rather than just Colombo.
Official reserves: The country’s stockpile of foreign currency and gold — the buffer to pay for imports and support the rupee. Running low was at the heart of the 2022 crisis.
OPR · Overnight Policy Rate: The Central Bank's main interest rate. Raising it makes borrowing costlier to cool inflation; cutting it makes loans cheaper to spur the economy. (Introduced November 2024.)
Per sovereign: Pawning is quoted per sovereign of gold — one sovereign is about 8 grams. It is how much cash you can borrow against each unit of gold you pledge.
Private-sector credit: How fast banks are lending to businesses and households. Strong growth signals activity; a sharp slowdown signals a credit crunch.
Real return: Your return after subtracting inflation — what your money actually gains in buying power. A 10% deposit when inflation is 8% is only a 2% real gain.
S&P SL20: A Colombo Stock Exchange index of 20 large, actively-traded companies — a cleaner read on the big blue-chips than the all-share ASPI.
Senior rate: A higher deposit rate several banks offer savers above a certain age (usually 55 or 60).
Spread: The gap between a bank’s buy and sell rate — effectively its margin on the exchange. A narrower spread is better for you.
Tenor: How long you lock your money in — e.g. a 1-year fixed deposit has a 1-year tenor.
Tourism earnings: Foreign currency the country earns from visitors — another major source of the dollars that back the rupee.
Tourist arrivals: The number of visitors arriving each month — a leading signal for tourism earnings.
Treasury-bill yield: The return on short-term government debt (91, 182 or 364 days). It is effectively the risk-free rate — a savings or FD rate is only attractive if it beats this.
TT · Telegraphic Transfer: The rate for money moved electronically bank-to-bank (a wire / SWIFT transfer), as opposed to physical cash notes. TT rates are usually a little better than cash rates.
Workers’ remittances: Money sent home by Sri Lankans working abroad. One of the biggest sources of foreign currency, so it directly supports the rupee.