Reported by: banking|Updated: July 31, 2020
Global fintech firm BCT Digital has launched rt360-ECL solution from ‘IND AS 109 Product Suite’ for Expected Credit Loss (ECL) reporting. rt360-ECL is an integral part of the IND AS 109 Product Suite and has been designed exclusively keeping in mind the unique and specific nuances of Indian financial institutions and the country’s regulatory environment. IND AS 109, the equivalent of the International Financial Reporting Standards-9 (IFRS 9), is being adopted by Indian financial institutions in order to bring in scientific methods for computing credit losses. IND AS 109 requires financial institutions to take the ECL approach as opposed to the Incurred Loss approach. Under the ECL approach, credit losses must be granularly and systematically estimated and provided for throughout the life span of a loan. The rt360-ECL is a business-driven technology solution that enables banks to compute ECL as per regulatory guidelines, while addressing requirements such as Point-In-Time Probability of Default (PD), Validation and forward-looking estimates. Jaya Vaidhyanathan, CEO at BCT Digital, said the rt360-ECL aggregates banks’ historical data and estimates parameters such as Probability of Default (PD), Loss Given Default (LGD) and Exposure at Default (EAD) and Effective Interest Rate (EIR) and its inbuilt standard functions support validation and calibration of models to ensure that the process is efficient and robust. She added its essential value additions include automation of credit risk monitoring processes, faster turnaround time to achieve regulatory compliance and internal reporting and proactive credit risk assessment and monitoring.