Understanding PAR30 and PAR90
Portfolio at Risk (PAR) is the single most-watched measure of loan-book quality. PAR30 and PAR90 tell you what share of the outstanding portfolio is carrying a payment that is more than 30 or 90 days overdue. Ustawi calculates both continuously from the loan ledger, so a rising PAR30 warns you about emerging delinquency well before those loans harden into losses.
What PAR actually measures
PAR is a ratio: the outstanding principal of loans that have any instalment overdue beyond a threshold, divided by the total outstanding principal of the portfolio. The threshold is the number in the name — PAR30 counts loans with a payment more than 30 days late, PAR90 more than 90 days late. Crucially it is the whole outstanding balance of an affected loan that enters the numerator, not just the missed instalment, because a borrower who has stopped paying puts their entire remaining balance at risk.
Why both PAR30 and PAR90
- PAR30 is your early-warning line. It moves first, so a climb here is the earliest portfolio-level signal that collections need attention.
- PAR90 is your severe-delinquency line. Loans that reach it are deep into the classification ladder and close to being provisioned heavily or written off.
- Watching the gap between them matters: a widening spread means loans that slipped past 30 days are not curing and are ageing on toward 90.
Calculated continuously, not rebuilt each period
Because Ustawi derives PAR live from loan schedules and actual payment history, you are not exporting balances into a spreadsheet and ageing them by hand once a month. The days-past-due on every loan is current, so the aging report reflects the book as it stands today rather than as it stood at the last manual cut.
A loan sitting in PAR90 is at risk, not yet lost. It can still cure, be restructured, or be recovered against collateral. PAR measures exposure to delinquency; write-off recognises loss. Keep the two distinct when reporting to a board or a funder.
| Measure | Overdue threshold | Reads as |
|---|---|---|
| PAR30 | > 30 days past due | Early-warning delinquency |
| PAR90 | > 90 days past due | Severe delinquency |