Insolvency and Bankruptcy Code (Amendment) Bill 2025 moved in Lok Sabha

Key facts

• Finance Minister Nirmala Sitharaman moved the Insolvency and Bankruptcy Code (Amendment) Bill 2025 in Lok Sabha on Wednesday.
• The Bill is the seventh amendment since the Insolvency and Bankruptcy Code (IBC) came into force in 2016 and the first since 2021.
• The Bill proposes a creditor-initiated, largely out-of-court resolution framework with a 150-day deadline.
• The new framework allows unrelated financial creditors and the debtor to reach an informal rescue plan, with National Company Law Tribunal (NCLT) limited to affirming moratorium and approving the plan.
• Between April and December 2025, average resolution time rose to 764 days, against the IBC stipulation of 330 days including litigation time.
• The Bill includes a framework aligned with a model United Nations (UN) law for faster resolution of cross-border and corporate group insolvency cases.