New norms built under IBC to govern rescue of non-bank lenders

According to IBBI chief M S Sahoo, the Insolvency and Bankruptcy Code has a provision for resolution of financial service providers and there is a thinking that such a solution could be looked at till the FRDI legislation is in place.
The Financial Resolution and Deposit Insurance (FRDI) Bill would provide a dedicated framework for financial service providers.
Sahoo said the Code has Section 227 that allows the government to notify certain financial service providers for the purpose of insolvency resolution proceedings in the manner as may be prescribed.
“It is possible to resolve some financial service providers at least those which resemble normal corporate debtors,” he added.