What is it about?
The Insolvency and Bankruptcy Code, 2016 (IBC) has been one of the most ground-breaking laws enacted in the country in recent times. It has already subsumed the existing Sick Industrial Companies Act (SICA), revamped the Debt Recovery Tribunals (DRT) and has emerged as a major legislation. Consequent to the implementation of IBC, there has been a paradigm shift in the debt-recovery scenario in India. Encompassing all companies, partnership firms and individuals, the code offers uniform, comprehensive insolvency legislation along with coherent and consistent provisions for the stakeholders affected by inability to pay debt or business failure. Unlike the time-consuming and never-ending process that used to be prevalent earlier, the code aims to attain time-bound and effective bankruptcy resolution. Now, the Insolvency and Bankruptcy Board of India (IBBI) has taken a pivotal role. This chapter analyses the IBC’s effectiveness in handling the situation that it was created for.
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Why is it important?
Financial System is the backbone of the country and financial health of these institutions is a mirror image of the economy. If all the stakeholders in Indian financial system practice credit discipline and due diligence , the probability of default will reduce and will improve the credit lending process in India. This paper gives deeper insights to financial health of Indian Banking Sector with implementation of IBC Code 2016 . As well as it will be an eye opener to banks to be more vigilant about their customers and mitigate their credit risk and promote credit discipline among borrowers.
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This page is a summary of: Drifts in Banking Business and Deepening Losses Amidst the Insolvency and Bankruptcy Code, 2016, September 2018, Springer Science + Business Media,
DOI: 10.1007/978-3-319-94613-9_9.
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