Direct Answer
ECL (Expected Credit Loss) is a forward-looking provisioning model where banks estimate potential future losses rather than waiting for a default to occur
1. Implementation Date: April 1, 2027. 2. Glide Path: Banks are allowed a transition period (up to 5 years, ending 2031) to absorb the capital impact of the initial jump in provisions. 3. Stages: Assets will be classified into Stage 1 (12-month ECL), Stage 2 (Significant risk increase), and Stage 3 (Impaired). Historical Context: This moves Indian banking to align with global IFRS 9 standards, replacing the traditional IRAC norms (90-day rule) which were criticized for being “too little, too late.”