MSMEs: Resolution framework for MSMEs under IBC would save a

MSMEs: Resolution framework for MSMEs under IBC would save a lot of time and resources: Ashvin Parekh


The government is looking at a pre-packed mechanism for small and medium enterprises. The idea is to provide protection to the small enterprises but also to not have the courts jam packed and provide an out-of-court solution to the banks and the creditors. as well. Do you see this being a success in India?
There are several facets to this. If this were to be implemented, it would be a big step on the part of the government. One thing is pretty clear. Right from the emergency credit line - -the first stimulus programme which was followed by second and then RBI which stepped in on Covid-19 stress alleviation, the government has been taking a lot of steps. When initially it was determined that if the financial lenders have to follow the normal course of IBC, then it will be flooded with many cases as a lot of MSEs were facing a lot of stress on account of economic cycles or Covid.

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