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Based on in which category the loan belongs to MFI/Bank can reserve the amount based on his countries regulations. For example
- For the loans falls under Standard category no need to have any provision or management can take the decision to keep 5% of the loan amount aside
- For the loans falls under Sub-Standard category, the management /country can decide to keep 20% of the loan amount aside
- For the loans falls under Doubtful category, the management /country can decide to keep 50% of the loan amount aside
- For the loans falls under Loss category, the management /country can decide to keep 100% of the loan amount aside
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