RBI working on exit system for firms facing bankruptcy

The RBI is working on a system to enable entrepreneurs seeking to exit insolvent firms, a top official said on Wednesday.

“We have been thinking (about) how to create a system so that people could voluntarily withdraw from an unattractive business,” RBI executive director B Mahapatra said in his address on ‘Managing Stressed Assets’ organised by Assocham.

He said it is felt there has to be a good bankruptcy system. He added that RBI has started working on an enabling a system for banks that will help those entrepreneurs seeking an honourable exit from unattractive ventures.

He said: “Nobody wants to be called a bankrupt person... Indian philosophy is that we do not like failures.”

Source : http://www.financialexpress.com/