New Delhi, Nov. 15 -- The government on Friday brought out fresh rules to handle non-bank lenders under the Insolvency and Bankruptcy Code, a move that is likely to help rescue distressed shadow banks and housing financiers that have been battling liquidity crunch for a year now.

The government will separately notify financial service providers or classes of such entities from time to time that will be covered by this special window under the bankruptcy code, an official statement from the ministry of corporate affairs said. A decision to this effect will be made during talks with the regulators concerned.

As per the rules, only a regulator will be allowed to refer a non-bank lender or housing financier to a bankruptcy tribunal, unlike ...