THE FINANCIAL RESOLUTION AND DEPOSIT INSURANCE BILL, 2017

Financial Resolution and Deposit Insurance (FRDI) Bill, 2017 is similar to the Insolvency and Bankruptcy Code, 2016. FRDI deals only with the companies that are in the financial sector entities such as banks and insurance companies etc. The Insolvency Code Act deals with companies in all other sectors (Non-financial institutions). Purpose of the Bill is to create a resolution regime for financial institutions when they face crisis without creating financial burden for the tax payers. FRDI Bill 2017 provides for specialized resolution mechanism of certain categories of financial service providers and establishment of Resolution Corporation which will contribute to the stability and resilience of the financial system. The advantages of FRDI Bill 2017 to all stakeholders of various Financial Service Providers in India are presented.