Suspension of IBC … can be up to March 31: FM Nirmala Sitharaman

Finance Minister Nirmala Sitharaman on Monday said the government is planning to extend the suspension of fresh insolvency proceedings for another three months. This would provide major relief to corporate borrowers hit by the pandemic, but impact the recovery process of lenders dealing with non performing assets.

Speaking at a virtual event of the Bangalore Chamber of Industry and Commerce, she said the government has supported MSMEs to help them tide over the damaging impact of the Covid-19 through several measures, including the Rs 3 lakh crore guaranteed loan programme.

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“Gradually even the suspension of the IBC (Insolvency and Bankruptcy Code)… further from 25th of December, I think…it can be up to March 31, 2021. So the entire year IBC (has been) suspended, rightfully so because every industry has gone through major stress because of the pandemic. And nobody could be drawn towards insolvency process which may have occurred during the pandemic,” she said, as per a PTI report.