Interim Finance – A Source of Operational Funding under IBC.

 Interim finance is defined as financial debt raised by Interim Resolution Professional/Resolution professionals, as the case may be, during Corporate Insolvency resolution processes according to the provisions of the Insolvency and Bankruptcy Code, 2016. The funds allow the insolvent company to remain operational and/or to meet the CIRP costs while undergoing the Corporate Insolvency Resolution Process (CIRP).



Benefits:

Due to the lower number of players providing interim finance, interim finance funds are issued at interest rates that are higher than the market rate. Interim finance has the “superiority” status in the pecking order of creditors. Lenders are eligible for interest payments even after the process of liquidation is begun and also receive preferential treatment during it.

Original source: https://www.resurgentindia.com/interim-finance-a-source-of-operational-funding-under-ibc

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