The Senate has passed the Factoring, Assignments and Receivables Financing Bill, 2026, a significant piece of legislation aimed at expanding access to finance for businesses, improving liquidity and strengthening both domestic and international trade.
The bill successfully passed its third reading during Tuesday’s plenary session after lawmakers reviewed and adopted its provisions in the Committee of the Whole.
Presenting the motion for the third reading, Senate Leader Senator Opeyemi Bamidele urged lawmakers to support the measure, describing it as an important step toward improving financing opportunities for businesses. The motion received backing from Minority Leader Senator Abba Moro, who highlighted the potential economic benefits expected from the legislation.
Following a voice vote, President of the Senate Senator Godswill Akpabio formally announced the passage of the bill.
Before the final approval, the Clerk of the Senate read the bill’s long title, which outlines its objective of creating legal certainty and transparency in receivables financing transactions.
The legislation is officially titled:
“A Bill for an Act to provide for the assignment of receivables, establish legal certainty, promote transparency, modernise assignment laws, facilitate access to credit, enhance domestic and international trade and for related matters.”
The bill introduces a comprehensive legal framework for receivables financing, a funding mechanism that enables businesses to convert outstanding invoices into immediate working capital by assigning or selling those receivables to financiers at a discounted value.
Speaking after the bill’s passage, Akpabio praised both chambers of the National Assembly for advancing the legislation and expressed optimism about its economic impact.
“I also thank the House of Representatives for initiating this, which I believe will help in both domestic and international trade. I thank all of you for your contributions and wish that this will also assist Nigeria to balance its deficits in trade with other countries,” he said.
Receivables financing, commonly known as factoring, is widely recognised as an alternative source of funding, particularly for Micro, Small and Medium Enterprises. The model allows businesses to unlock cash tied up in unpaid invoices instead of depending solely on traditional bank lending.
For years, industry stakeholders have maintained that the absence of a dedicated legal framework has constrained the growth of factoring in Nigeria, despite its potential to improve cash flow, strengthen business performance and widen access to credit.
Lawmakers believe the newly approved framework will provide greater legal certainty and increase confidence among financiers, investors and businesses involved in receivables financing transactions. It is also expected to align Nigeria’s commercial and financial regulations more closely with international best practices.
Supporters of the legislation argue that improved access to working capital could help businesses scale operations, meet contractual obligations more efficiently, generate employment opportunities and enhance competitiveness in both local and international markets.
With its passage by the Senate, the bill has completed the legislative process at the National Assembly and will now be forwarded to President Bola Tinubu for presidential assent.
If signed into law, the legislation is expected to establish a modern receivables financing system that supports enterprise development, improves business access to capital and contributes to Nigeria’s broader economic growth objectives.
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