As per Section 240A of the IBC, 2016, which was introduced by the 2018 Amendment to the Code, makes an exception for MSMEs from Section 29A, which specifies the Non-MSME Corporate persons not eligible to be resolution ap

Cost-effective and speedier: Pre-Packaged Insolvency Resolution Process (PPIRP) may be preferred because it combines the benefits of informal and formal processes. It helps resolve corporate distress, swiftly and cost-effectively as it minimizes state intervention and avoids the stigma of formal insolvency. Role of Corporate Debtor (CD) in the Resolution Process: The best people to solve a company's money problems are the people who run the company. The company's management has a close understanding of the business and is in the best position to determine the process of recovery. Their voluntary initiation of the pre-pack process, with stakeholder consent also mitigates the risk of liquidation. Management with CD: In CIRP, the RP takes ownership of the company. However, it is extremely difficult for the RP to effectively manage a company that they are unfamiliar with. In contrast, under the PPIRP, management stays with the CD. This means there will be little disruption to the company's regular operations, thereby lowering the chance of job losses. Burden of NCLT reduced: Approval will happen quicker because there isn't likely to be an issue with the resolution plan as Financial Creditors and Corporate debtors have already reached an informal understanding. Preliminary Work: PPIRP commences only upon meeting specific prerequisites: obtaining approval from at least sixty-six per cent of Financial Creditors for the proposal and confirming the name RP; passing of a special resolution with approval of 75% of members of the company; drafting a Base Resolution Plan by the CD; and confirming the RP's name through approval from both parties. However, there are fewer preliminary steps involved before initiating a CIRP which extends the timeline.