New Delhi, Oct 1 (PTI) Personal insolvency regime is expected to be fully operational in one-year, and a non-adjudicatory process is being worked out for entities having very small exposures, Corporate Affairs Secretary Injeti Srinivas said on Tuesday.

Besides, the corporate affairs ministry is keen to develop a marketplace for stressed assets so that there is maximum participation and value can be achieved for such assets.

The Insolvency and Bankruptcy Code (IBC), which came into force in 2016, provides for personal insolvency, but the provision is yet to be made operational.

"There are several new challenges we need to address as we move on. The first among these challenges is personal insolvency. We have not yet commenced personal insolvency. It is a very large subject because it will bring in every type of borrower in its ambit," Srinivas said at a function to mark the third anniversary of the Insolvency and Bankruptcy Board of India (IBBI) here.

The corporate affairs ministry will be implementing the personal insolvency regime in phases.

"In the first phase, personal guarantor to a corporate debtor is almost under commencement. The next would be the fresh start process, basically giving relief to very small borrowers who are not in a position to repay the debt. That may be in another four to six months. Then proprietorship and partnership and others," he said.

According to him, an year's time will be required for personal insolvency to be fully operational and debt recovery tribunals (DRTs) will be the main institutions for it.

"For very very small known exposures, we are looking at a non-adjudicatory process. That will be a total online system... it would be based on verification... whether it is about assets they (such borrowers) have or their monthly income. Accordingly, insolvency would be determined and relief would be extended," he said.

Further, Srinivas said the cross-border insolvency and group insolvency are also two major subjects in the agenda.

The framework for cross-border insolvency is ready based on UNCITRAL law, Srinivas said and hoped that the law would be passed in the Winter Session of Parliament.

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