CBN Proposes Mediation Panel to Resolve Loan Disputes Outside Courts

The Central Bank of Nigeria (CBN) has unveiled plans to establish a mediation panel aimed at handling loan-related disputes, in a move designed to reduce reliance on the court system.

The proposal was detailed in a circular signed by P. I. Oluikpe, Acting Director of the Development Finance Advisory Department, inviting stakeholders to review draft guidelines for setting up a Mediation and Dispute Resolution Panel under the Secured Transactions in Movable Assets framework.

According to the apex bank, the proposed panel will serve as the first point of contact for disputes arising from secured lending involving movable assets, before any matter can proceed to court.

The initiative is intended to strengthen Nigeria’s financial system by providing a faster, more cost-effective platform for resolving disagreements between lenders and borrowers. It is anchored on the Secured Transactions in Movable Assets Act, which encourages mediation as an initial step in dispute resolution.

Under the draft framework, the panel will adopt alternative dispute resolution methods and is expected to conclude cases within 90 days from the first hearing. Parties involved must agree to the panel’s authority and show evidence that they attempted informal resolution—such as negotiation—before escalating issues.

The proposed panel will be made up of experienced professionals from fields including law, banking, finance, and dispute resolution, each with at least a decade of expertise. The CBN plans to appoint 30 members, with smaller three-person panels assigned to cases on a rotational basis.

Decisions reached by the panel will be binding and enforceable in court, although parties may appeal on limited legal grounds within specified timelines.

The guidelines also stress strict confidentiality, ensuring that all proceedings and shared information remain protected. Funding for the panel is expected to come from CBN support, administrative fees, and other contributions.

Stakeholders have been invited to submit feedback on the proposal before the October 9, 2026 deadline.

This development comes as part of broader efforts by the CBN to improve credit discipline and enhance stability in the financial sector.