CBN Proposes Mandatory Mediation Panel for Loan Disputes Before Court Action in Nigeria

The Central Bank of Nigeria (CBN) has introduced a new proposal that could significantly change how lending disputes are handled in the country’s financial system. Under the plan, creditors and borrowers must first go through a mediation and dispute resolution panel before taking any loan-related disagreements to court.

The proposal was contained in a circular issued by the apex bank on Tuesday, inviting stakeholders to review and provide input on draft guidelines for the Mediation and Dispute Resolution Panel under the Secured Transactions in Movable Assets framework. The circular was signed by P. I. Oluikpe, Acting Director of the Development Finance Advisory Department.

According to the draft guidelines, the mediation panel is designed to serve as the first point of call for resolving disputes arising from collateral-backed lending. The CBN explained that the panel will have first-instance jurisdiction over such cases, meaning disputes must be addressed there before any court action can proceed.

The framework also sets a structured process for dispute resolution, requiring the panel to deliver decisions within 90 days of the first hearing. Awards issued by the panel will be legally binding and enforceable in court as consent judgments, while parties are expected to comply within 30 days or face enforcement at the Federal High Court.

The CBN said the initiative aims to improve confidence in secured lending, reduce delays in dispute resolution, and expand access to credit in the financial system. Stakeholders have been given until October 9, 2026, to submit feedback on the proposed guidelines as part of the consultation process.

source: nairametrics