Is the IBC building a stronger credit culture? The answer is largely yes. The law has made default costly, given lenders real power, and put a clock on a process that once dragged on for years. However, a genuine credit culture needs more than a good law. It needs supporting infrastructure, including more tribunal benches and judges, timelines that are actually met, and fair treatment for every class of creditor.
The Insolvency and Bankruptcy Code, 2016 (IBC or the Code) is now the main law India uses to deal with companies that cannot pay their debts—in the language of the Code, a “corporate debtor” that has committed a “default”. Figures published by the Insolvency and Bankruptcy Board of India (IBBI) for 2025–26 show the…