Lawmakers Debate Bills On Factoring, Fraud Protection In Banking Sector

The House Committee on Banking Regulations has held a public hearing on two key financial reform bills aimed at expanding access to finance for small and medium enterprises (SMEs) and protecting bank customers from fraudulent withdrawals.

The Chairman of the Committee, Mohammed Bello- El-Rufai, said the bills reflect the House’s resolve to strengthen Nigeria’s financial system through transparency, accountability, and consumer protection.

“The first bill seeks to regulate factoring and receivables financing businesses financial mechanisms that enable businesses to raise funds using unpaid invoices as collateral.

“The second proposes amendments to the Banks and other Financial Institutions Act (BOFIA) 2020 to protect victims of fraudulent bank transactions.

“These bills demonstrate our continued commitment to building a financial system that is fair, accountable, and aligned with international best practices,.“They are designed to enhance trust, transparency, and stability in Nigeria’s banking ecosystem.” he said.

He commended the sponsor of the BOFIA amendment bill, Moses Fayinka
for his efforts to improve consumer protection and financial integrity. El-Rufai urged regulators, including the Central Bank of Nigeria, CBN, the Securities and Exchange Commission, SEC, and the Nigerian Export-Import Bank, NEXIM, to make contributions that would shape effective legislation.

Delivering the opening remarks, Kaduna State Governor, Senator Uba Sani, called the Factoring and Receivables Financing Bill a “transformational legislative intervention” capable of deepening access to finance and stimulating productivity across Nigeria’s economy.

Sani, who sponsored a similar bill during his tenure as Chairman of the Senate Committee on Banking, Insurance and Other Financial Institutions in the 9th National Assembly, said factoring could be a “critical engine for trade finance and SME growth.”

“Many Nigerian businesses deliver goods and services on credit but are forced to wait months before being paid.

“Factoring provides a practical solution by enabling them to raise cash against receivables, sustain operations, and expand production,” he said.

Represented by Special Adviser on Research, Documentation and Strategy, Mr. Fabian Okoye, the Governor emphasised the need for transparency and balance in implementing the law, ensuring that SMEs are protected from predatory practices and that the framework aligns with existing financial regulations.

Sani commended the Speaker of the House, Rt. Hon. Abbas Tajudeen for his leadership and commitment to economic reform, and praised El-Rufai’s committee for sustaining the legislative drive toward inclusive financial growth.

“When passed, this Bill will not only expand access to finance but also foster innovation, reduce the cost of credit, and promote sustainable economic growth,” Sani said.

The public hearing brought together representatives from the CBN, NEXIM, SEC, Afreximbank, the World Bank, the African Development Bank (AfDB), and other key industry stakeholders.

Oduyemi Odumade, Edited By Grace Namiji