Bangladesh Bank has established an out-of-court dispute resolution framework designed to fast-track the settlement of non-performing loans and reduce the substantial volume of cases awaiting adjudication in the Money Loan Courts (Artha Rin Adalat). Issued on Thursday by the Banking Regulation and Policy Department-2, the policy outlines formal qualification and performance criteria to enlist professional mediation organisations across the country.
The initiative enables commercial banks, non-bank financial institutions, and borrowers to pursue Alternative Dispute Resolution (ADR) prior to launching formal litigation, provided both sides agree in writing. Contending parties entangled in existing judicial proceedings may also seek settlement through accredited mediators, pausing adversarial court battles in favour of negotiated recovery terms.
Organisations applying for enlistment must be legally incorporated under the Societies Registration Act 1860, the Partnership Act 1932, or the Companies Act 1994. Eligible candidates must have at least three years of professional standing, an active Taxpayer Identification Number (TIN), an up-to-date trade licence, and three consecutive years of audited financial statements. All related transactions must pass through designated institutional bank accounts to maintain financial transparency.
The central bank has set rigorous governance hurdles to safeguard credibility. Any firm whose directors, chief executive, or board members have records of loan defaults, insolvency, fraud, corruption, financial misappropriation, money laundering, or convictions for serious criminal offences will face immediate exclusion. Candidates must achieve a minimum score of 70 out of 100 on the regulator’s vetting scorecard to secure accreditation. Approved enlistments carry a three-year validity, renewable upon satisfactory review if applied for at least 90 days before expiry.
Each accredited organisation must maintain panels consisting of at least five expert mediators, with mandatory seats for a certified accountant and a legal specialist. Panel members are required to possess at least ten years of practical experience across banking, finance, law, auditing, accountancy, or the judiciary. To ensure impartiality, individuals holding political influence or active political affiliations are barred from serving on these panels, with all mediators bound by strict confidentiality and conflict-of-interest standards.
Bangladesh Bank will conduct regular monitoring, including unannounced inspections of physical facilities, digital dispute-management systems, and operational records. Enlisted bodies must lodge comprehensive annual performance reports within two months of each calendar year’s conclusion. Misleading disclosures, procedural violations, compromised neutrality, or ethical breaches will result in formal warnings, monetary penalties, temporary suspension, or outright revocation of enlistment.