CBN Proposes Mediation Panel for Loan Dispute Resolution

The Central Bank of Nigeria (CBN) has introduced a proposal for a mediation panel aimed at resolving loan disputes prior to litigation. This initiative is part of a broader effort to restructure the lending dispute resolution process, encouraging creditors and borrowers to first submit their issues to the mediation panel before approaching the courts.

The draft guidelines for this mediation panel, which stakeholders can comment on until October 9, 2026, are designed to handle civil disputes related to secured lending transactions under the framework established by the Secured Transactions in Movable Assets Act of 2017. The panel will have first-instance jurisdiction over disputes, requiring parties to exhaust mediation before pursuing litigation.

Decisions from the panel are expected to be legally binding and enforceable in court. The CBN aims to provide a cost-effective platform for resolving disputes related to movable asset-backed lending, reinforcing non-adversarial resolution methods.

The guidelines also require parties to demonstrate prior good faith efforts to resolve disputes before engaging the panel.