New Delhi, 29 December. The proposed amendments in the Insolvency and Bankruptcy Code (IBC) Bill, 2025, could provide significant relief to banks and lenders in recovering loans. These changes are expected to speed up the resolution process, which currently takes a considerable amount of time.
An ICRA report released on Monday stated that the IBC 2025 includes changes such as group insolvency processes, handling insolvency cases with foreign connections, and insolvency proceedings initiated by creditors. These measures may help in faster case disposal.
According to the ICRA report, increasing the staff strength at the National Company Law Tribunal (NCLT) and National Company Law Appellate Tribunal (NCLAT), along with legal reforms, will reduce the burden on the courts.
The report noted that the IBC amendments introduced in Parliament, along with suggestions from the Ministry of Corporate Affairs (MCA) and the Insolvency and Bankruptcy Board of India (IBBI), will shorten the loan recovery time and enable banks to recover more funds. However, these reforms will not apply to the real estate sector at present.
The report highlighted that many insolvency cases are still pending in the real estate and construction sectors, but no major reforms have been proposed for these sectors yet.
ICRA emphasised the necessity of separate reforms for the real estate sector to protect homebuyers and complete stalled projects.
The IBC law completed nine years in October 2025. During this period, loan recoveries worth nearly Rs 4 lakh crore have been made through this law, which is better than alternative methods. By September 2025, 8,658 company cases were filed under IBC, of which 63 percent have been resolved.
The report also stated that banks suffered significant losses in several cases, recovering only about 32 percent of the dues. This underscored the need for major changes in IBC, leading to the introduction of the 7th Amendment Bill in the Lok Sabha in August 2025.
ICRA’s Senior Vice President, Manushri Sagar, said that loan recovery improved until March 2025 but declined again in the first half of 2026. She added that nearly 75 percent of ongoing cases by September 2025 had exceeded the 270-day resolution period.
The report further revealed that over 30,000 cases are pending at NCLT. Given the current capacity, it may take more than 10 years to clear these cases.
However, the government is planning to increase the benches at NCLT and NCLAT, which could accelerate case resolution. Currently, cases under IBC take an average of 700 days to resolve, while the prescribed time limit is only 330 days.
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My name is Bhupendra Singh Chundawat. I am an experienced content writer with several years of expertise in the field. Currently, I contribute to Daily Kiran, creating engaging and informative content across a variety of categories including technology, health, travel, education, and automobiles. My goal is to deliver accurate, insightful, and captivating information through my words to help readers stay informed and empowered.
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