What Is the New Insolvency Bankruptcy Code Or IBC?

Today India's sovereign bond gained in respect of Moody's rating which provides the country a more stable outlook. With it many positives are around the corner one of them is the borrowing getting cheaper from the overseas markets.

What Is the New Insolvency Bankruptcy Code Or IBC?

Some of the economic reforms factored in for providing the upgrade are the country's back to back reforms by way of either as new revised insolvency bankruptcy code, demonetisation, GST. So, what is this new IBC code. Here in detailed some of the important aspects pertaining to the same.

The main idea of the new IBC was to narrow down the ballooning NPAs with the banking sector which saw no respite.

The provisions tightened the strings of bank in terms of lending as they can now lend with compassion.

The defaulters and borrowers will come at a level playing field and errs or default on bad loans is expected to reduce going forward as they know if they default all their asset base shall be put to bankruptcy courts.

Few of the other provisions which were absent earlier include:

Timeline for the repayment of debt

Cap in respect of debt grant to corporate

Also to reduce as far as possible asset liability

Today, NBFC companies are also seen to trade higher cheering the bank recapitalization and IBC moves of the government.

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