The Central Bank of Nigeria (CBN) has proposed the establishment of a Mediation and Dispute Resolution Panel to handle loan-related disputes and reduce the need for immediate court action in secured lending transactions.
The proposal was outlined in a circular signed by the Acting Director of the Development Finance Advisory Department, P. I. Oluikpe, inviting stakeholders to submit comments on draft guidelines for the panel under the Secured Transactions in Movable Assets framework.
According to the CBN, the panel will serve as the first point of resolution for disputes arising from the use of movable assets as collateral, exercising initial jurisdiction before any matter proceeds to court.
The apex bank stated that the initiative is aimed at strengthening the financial system and improving dispute resolution processes in lending arrangements backed by movable assets.
The proposed panel is designed to provide a specialised and cost-effective platform for resolving issues related to the creation, perfection, and enforcement of security interests in movable assets, in line with the Secured Transactions in Movable Assets Act, 2017.
Under the draft guidelines, the panel will adopt alternative dispute resolution mechanisms to ensure faster resolution of disputes while preserving relationships between borrowers and lenders. It is expected to deliver decisions within 90 days of the first hearing.
Parties involved in disputes will be required to consent to the panel’s jurisdiction and show evidence of prior attempts to resolve issues through informal means such as negotiation before escalation.
The panel will consist of professionals from law, banking, finance, and dispute resolution, each with a minimum of 10 years’ experience. The CBN will appoint 30 members, with panels of three constituted on a rotational basis and supported by a secretariat for administrative functions.
Proceedings may be conducted physically, virtually, or through a hybrid format, with an emphasis on confidentiality throughout the mediation process.
Decisions reached by the panel will be legally binding and enforceable in court as consent judgments, although parties retain the right to appeal on limited legal grounds within specified timelines.
Funding for the panel will come from CBN support, administrative fees paid by parties, and other approved sources.
The CBN noted that it is seeking stakeholder input as part of its inclusive policy development process, with submissions expected by October 9, 2026.
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