27/06/2025
In the NOW: One Insolvency Code for All? Why India’s Financial Sector Needs a Tailored Framework — Now
📍 ET LegalWorld Banking & Finance Law Summit 2025
💬 A deeply nuanced, high-stakes conversation on India’s IBC framework, financial sector vulnerabilities, and the need for sector-specific insolvency solutions.
💡 Top Insights from the Discussion
IBC is not one-size-fits-all. India’s current insolvency regime works for corporates—but falters when applied to financial service providers, especially NBFCs, banks, and fintech players.
Legal ambiguity reigns: Conflicting judgments across benches (NCLT, NCLAT, High Courts) threaten regulatory certainty, with stock brokers, insurers, and housing finance players caught in a legislative grey zone.
Systemic risk is real: A collapse of a large FSP can create contagion across sectors, impacting depositors, investors, and national financial stability.
Urgent clarity needed: The panel emphasized the need for dedicated legislation, uniform applicability, and pre-approval compliance frameworks across regulators like RBI, SEBI, and CCI to avoid bottlenecks post-resolution.
Investor trust at stake: Inordinate delays and inconsistent precedents (e.g., Bhushan Power & Steel case) risk derailing India's Ease of Doing Business goals and global capital confidence.
Mediation ≠ solution: Non-binding mediations often delay rather than resolve insolvency outcomes—time is of the essence under IBC.
💡 "The success of the IBC hinges on predictability, uniformity, and trust. Without that, even the best resolution plans are vulnerable."
🎙 Moderator:
Maulik Vyas, Senior Assistant Editor, The Economic Times
👥 Panelists:
• Sanjay Bhatt, Head of Legal, Kotak Mahindra Bank
• V. Vijaydheer, CGM (Legal), IDBI Bank
• Amber Gupta, SVP - Head Legal, NSE
• Ramakant Rai, Partner, Trilegal
🔗 Know more about ET Legal: https://legal.economictimes.indiatimes.com/
