"The inadequacy of the incurred loss approach for provisioning by banks and its procyclicality, which amplified the downturn following the financial crisis of 2007-09, has been extensively documented. One of the major elements of the global response to these findings have been a shift to expected credit loss (ECL) regime for provisioning," the central bank said in the statement on developmental and regulatory policies.source https://economictimes.indiatimes.com/industry/banking/finance/banking/reserve-bank-of-india-proposes-lenders-to-adopt-expected-loss-based-approach-for-loan-loss-provisioning/articleshow/94552219.cms
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