The 30 days past due backstop

Days past due is the one SICR indicator every lender has, which makes it tempting to rely on. IFRS 9 deliberately treats it as a last line of defence. This guide explains the 30-day backstop, the 90-day default presumption, when each can be rebutted, and how cure and probation periods work.

By Mirza Fahad Baig, Chartered Accountant. Reviewed by Hamza Fida, Chartered Accountant. 3 minute read.

Short answer

Under IFRS 9, when contractual payments are more than 30 days past due, there is a rebuttable presumption that credit risk has increased significantly since initial recognition, moving the asset to stage 2. It is a backstop, the latest point at which stage 2 should be recognised, not the main SICR test. The presumption can be rebutted only with reasonable and supportable information that credit risk has not increased significantly. A separate presumption treats more than 90 days past due as default, usually meaning stage 3.

At a glance

30 days past due
Presumed significant increase: stage 2
90 days past due
Presumed default: usually stage 3
Presumptions
Rebuttable with evidence
Role
Backstop, not the primary test
Rebuttal example
Administrative delay, not credit-related
Cure
Often after a probation period
The 30 days past due backstop30 days past due: Presumed significant increase: stage 2; 90 days past due: Presumed default: usually stage 3; Presumptions: Rebuttable with evidence; Role: Backstop, not the primary test; Rebuttal example: Administrative delay, not credit-related; Cure: Often after a probation period.KEY FACTS AT A GLANCEThe 30 days past due backstop30 days past duePresumed significantincrease: stage 290 days past duePresumed default: usuallystage 3PresumptionsRebuttable with evidenceRoleBackstop, not the primarytestRebuttal exampleAdministrative delay, notcredit-relatedCureOften after a probationperiodTax BakersThe 30 days past due backstop30 days past due: Presumed significant increase: stage 2; 90 days past due: Presumed default: usually stage 3; Presumptions: Rebuttable with evidence; Role: Backstop, not the primary test; Rebuttal example: Administrative delay, not credit-related; Cure: Often after a probation period.KEY FACTS AT A GLANCEThe 30 days past due backstop30 days past duePresumed significant increase: stage 290 days past duePresumed default: usually stage 3PresumptionsRebuttable with evidenceRoleBackstop, not the primary testRebuttal exampleAdministrative delay, not credit-relatedCureOften after a probation periodTax Bakers
Key facts at a glance, as set out in this guide.

How does the 30 days past due backstop work?

Days past due and the IFRS 9 presumptionsDays past due and the IFRS 9 presumptionsPresumptionUsual stage0 to 30 daysNone: use otherSICR indicatorsStage 1 unlessother triggers31 to 90 daysSignificant increasein credit riskStage 2Over 90 daysDefaultStage 3
Both presumptions can be rebutted, but only with reasonable and supportable evidence.

IFRS 9 expects lenders to identify a significant increase in credit risk before payments are missed, using forward-looking information such as rating changes and economic forecasts. Payments falling more than 30 days past due is a lagging indicator: by then credit risk has usually already increased. The backstop makes sure that, whatever the model says, an asset that is more than 30 days past due is not left in stage 1 without a reason.

When can the 30-day presumption be rebutted?

Only when the lender has reasonable and supportable information that credit risk has not increased significantly even though payments are more than 30 days past due. Examples:

  • The delay is administrative, such as a payment system change or a disputed invoice, not a sign of financial difficulty, and the lender has evidence of this.
  • Historical evidence for a portfolio shows that accounts 30 to 60 days past due have no higher default rates than current accounts, for example some public sector receivables paid late as a matter of routine.

A rebuttal should be documented, limited to clearly defined cases and monitored; regulators challenge broad or permanent rebuttals.

An example

LoanDays past dueOther informationStage
D45Borrower's sales have fallen; lifetime PD up only 1.2x2: the backstop applies even though the PD test is not met
G35Payment delayed by a bank account change; borrower has paid in full since1: presumption rebutted, with evidence
E120Borrower has stopped paying3: default presumed after 90 days

Loan D shows why the backstop matters: the PD model had not caught up with the borrower's difficulties, but the missed payments move it to stage 2 anyway.

What about 90 days past due?

IFRS 9 presumes that default does not occur later than 90 days past due, unless the lender has reasonable and supportable information that a more lagging criterion is appropriate. The definition of default must be consistent with the one used for credit risk management, and lenders usually align it with the regulatory definition. Defaulted assets are generally credit-impaired and in stage 3; see credit-impaired assets.

How do assets cure?

When arrears are cleared, an asset may move back to an earlier stage, but most lenders require a probation period first, such as three consecutive months of payments for stage 2 assets, and longer for restructured loans, to show that the improvement is lasting. The probation rules form part of the lender's documented staging policy.

How are days past due counted for revolving facilities?

For credit cards and overdrafts, days past due are counted from the first missed minimum payment, or from when an overdraft has exceeded its limit for a set period. Lenders define the counting rules in their policies and apply them consistently, because a small change in the rule can move many accounts across the 30-day line.

Does the backstop apply to trade receivables?

Not directly. Under the simplified approach there is no stage 1, so there is nothing to move. But days past due still drive the loss rates in a provision matrix. See significant increase in credit risk, ECL stages explained and the provision matrix.

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Questions people ask

What is the 30 days past due backstop in IFRS 9?

A rebuttable presumption that credit risk has increased significantly when payments are more than 30 days past due, moving the asset to stage 2.

Can the 30 days past due presumption be rebutted?

Yes, but only with reasonable and supportable information that credit risk has not increased significantly, such as evidence of an administrative delay.

When is a loan presumed to be in default under IFRS 9?

When payments are more than 90 days past due, unless a more lagging criterion is supported by evidence.

Is 30 days past due the main SICR test?

No. It is a backstop; lenders should identify significant increases earlier using forward-looking information.

Sources

Every fee, date and rule on this page was taken from these official and primary sources.

  1. IFRS Foundation: IFRS 9 Financial Instruments

Rules and fees change. If you are reading this long after October 4, 2026, confirm the figures with the source before you rely on them.

ECLSignificant increase in credit risk (SICR)ECLCredit-impaired assets and stage 3ECLECL stages 1, 2 and 3 explained

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This guide is general information. It is not tax or legal advice for your situation.