AN EXAMINATION OF THE LEGAL FRAMEWORK FOR SECURED CREDIT TRANSACTIONS IN NIGERIA

Abstract

Secured credit transactions constitute a cornerstone of modern commercial activity, enabling debtors to access credit facilities by pledging assets as collateral while simultaneously protecting creditors against the risk of default. In Nigeria, the legal framework governing such transactions is characterised by a complex, fragmented, and often archaic body of law drawn from multiple sources including English common law, equity, statute, and customary law. This paper critically examined the legal architecture of secured credit transactions in Nigeria, analysed the principal legislative instruments, judicial pronouncements, and institutional mechanisms that shape the practice of secured lending. It evaluated the role of the Companies and Allied Matters Act 2020, the Secured Transactions in Movable Assets Act 2017, the Land Use Act 1978, and other ancillary legislation in regulating the creation, perfection, priority, and enforcement of security interests. The paper further interrogated the persistent challenges confronting the regime, including definitional inconsistencies, enforcement difficulties, jurisdictional conflicts, and the inadequacy of existing registration infrastructure. Drawing on comparative analysis, the paper argued for systemic reform anchored in clarity, predictability, and international best practice, and concludes with recommendations aimed at modernizing the Nigerian secured transactions framework to facilitate greater access to credit and economic development.