Interim Finance under IBC

🌟 Key Benefits of Using a Consultancy for Interim Finance

Benefit	Explanation
✅ Speed & Expertise	Faster arrangement due to experienced team and network.
✅ Access to Lenders	Consultancy connects with niche lenders who specialize in CIRP lending.
✅ Better Terms Negotiation	Helps negotiate better interest rates and repayment terms with lenders.
✅ Risk Mitigation	Ensures compliance to reduce legal/financial risks for stakeholders.
✅ Increased Resolution Success	Smooth liquidity enables better operations during CIRP, attracting resolution applicants.

✅ What is Interim Finance under IBC?

Interim Finance refers to short-term funding raised by the Resolution Professional (RP) during the Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code (IBC),

2016. It is used to keep the Corporate Debtor (CD) as a going concern until a resolution plan is finalized.

Under Section 5(15) of IBC, interim finance includes any financial debt raised by the RP with the approval of the CoC (Committee of Creditors) during CIRP.

🏢 Interim Finance Consultancy Services in India

A consultancy firm offering Interim Finance services under IBC provides support in:

• 1. Assessment of Requirement:
  • Analysing working capital needs.
  • Estimating liquidity gap during CIRP.
• 2. Liaison with CoC & RP:
  • Preparing the proposal for interim finance approval.
  • Negotiating terms with lenders and CoC.
• 3. Funding Arrangement:
  • Connecting with ARCs, special situation funds, NBFCs, and banks.
  • Structuring the finance with minimum risk and competitive interest rates.
• 4. Legal & Compliance Support:
  • Drafting term sheets and loan agreements.
  • Ensuring compliance with IBC, RBI, and SEBI guidelines.
• 5. Post-Funding Monitoring:
  • Ensuring fund usage aligns with the CIRP budget.
  • Coordination between stakeholders to mitigate misuse.

🔑 Who Can Avail These Consultancy Services?

• Insolvency Professionals (IPs)
• Resolution Professionals (RPs)
• Committee of Creditors (CoC)
• Promoters aiming to regain control via resolution plan
• Investors looking to fund interim finance as a structured opportunity