Urgency, Mechanism, and Efficiency: An Economic Law Framework of Credit Dispute Resolution

This research addresses the critical issue of protracted and costly non-performing loan (NPL) dispute resolution in Indonesia, which impedes economic stability and burdens legal relationships. It novelly applies an economic analysis of law framework to examine the mechanism and urgency of NPL dispute resolution, prioritizing efficiency to optimize resource allocation, minimize transaction costs, and expedite settlements. Employing a normative qualitative approach, this study demonstrates the superior effectiveness of efficiency-based alternative dispute resolution (ADR) mechanisms like mediation and arbitration over conventional litigation. The findings contribute by highlighting ADR's potential to enhance legal certainty and public trust in the financial system. The research urges the strengthening of ADR regulations and institutional capacity to foster a more adaptive and sustainable legal framework for NPL management in Indonesia.