The Central Bank of Nigeria (CBN) has directed that creditors and borrowers must submit to a mediation panel to resolve lending disputes before seeking redress in the nation’s courts.
This directive was contained in a circular released on Tuesday, featuring draft guidelines for the Mediation and Dispute Resolution Panel under the Secured Transactions in Movable Assets framework.
The apex bank is now inviting stakeholders to review and provide comments on these proposed guidelines, which aim to streamline the recovery process for loans backed by movable collateral.
Under the new framework, the mediation process will serve as a mandatory precursor to litigation, seeking to reduce the burden on the judiciary and accelerate financial dispute resolutions.
By prioritizing alternative dispute resolution, the CBN intends to improve the efficiency of the National Collateral Registry and boost lender confidence in using non-landed assets for credit.
However, in march, 33 money banks met the CBN recapitalization targets; as the apex bank successfully concluded the 24-month banking sector exercise, raising ₦4.65 trillion ($3.36 billion) in fresh capital to bolster the resilience of the nation’s financial system.
This policy shift aligns with ongoing reforms by Governor Olayemi Cardoso to strengthen credit discipline and enhance the overall stability of Nigeria’s evolving financial ecosystem.
