economics hard Fill in the Blank

Under the Insolvency and Bankruptcy Code (IBC), 2016, a resolution plan for a defaulting corporate debtor can only be approved by the Committee of Creditors (CoC) if it secures a minimum voting threshold of ___% of the financial debt.

  1. crowding out
  2. Production
  3. 66
  4. public

Answer: 66

Originally set at 75%, the threshold was lowered to 66% by the government to prevent a single, stubborn minority creditor from blocking viable resolution plans and forcing the liquidation of a company. This supermajority requirement ensures that the collective wisdom of the majority creditors prevails, facilitating faster and more realistic revival of stressed assets.

Topic Banking - NPA Resolution
Exam Relevance UPSC Prelims, Banking, SSC
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