The Federal Inland Revenue Service (FIRS) has revealed that the forthcoming National E-Invoicing System could significantly enhance access to credit for Nigerian manufacturers, marking a major step toward fostering a robust credit economy in the country.
Speaking during a recent stakeholder engagement held in Lagos, the FIRS emphasised that the adoption of e-invoicing is not just a tax compliance tool but a game-changer for business financing and economic growth. The system, scheduled for nationwide launch on July 25, aims to modernize invoice management, boost transparency, and improve the ease of accessing financing within the business ecosystem.
Mr. Sadiq Arogundade, lead consultant on the National E-Invoicing Project, highlighted the critical role invoices play in business transactions. According to Arogundade, invoices are a symbol of trust, commitment, and value — essential components for unlocking credit.
“Invoices represent trust, commitment, and value. We are not just talking about taxes or taxation but about technology and the global competitiveness of your business,” Arogundade explained. He added that manufacturers and other businesses can leverage e-invoices verified by FIRS to enter the money market through factoring — effectively turning invoices into financial assets that can be used to raise capital without upfront cash.
This initiative aims to address one of the major challenges for Nigerian manufacturers — limited access to affordable credit due to lack of verifiable financial records and the high risk perceived by financial institutions.
The introduction of the e-invoicing system will create standardised, secure, and verifiable invoices using the Universal Business Language format. This technological advancement is expected to reduce delays in payments, minimise errors, and resolve compliance issues that currently hinder business operations.
Mr. Arogundade further explained, “We have built a product that will help to automate tax compliance and improve efficiency. The e-invoicing system will also provide real-time data on tax compliance, which will enable the FIRS to make informed decisions and improve tax administration.”
By facilitating accurate, transparent invoicing processes, manufacturers will be able to build credible financial histories, thus improving their creditworthiness. Banks and other lenders can then confidently extend loans, boosting working capital and growth opportunities within the sector.
Concerns about data confidentiality were addressed by Mr. Mike Adoga, Acting Director of Tax Automation at FIRS. He reassured stakeholders that all data shared through the e-invoicing platform will be protected under the Nigeria Data Protection Act, ensuring strict compliance with data privacy laws.
“We are guided by the Nigerian Data Protection Act, and all data that is passed for tax purposes remains confidential,” Adoga affirmed. This assurance is expected to encourage wider adoption of the system, particularly among small and medium-sized manufacturers wary of data breaches.
The National E-Invoicing System is poised to revolutionize Nigeria’s business landscape by integrating modern technology into financial and tax systems. This digital shift will empower manufacturers to streamline operations, enhance cash flow management, and reduce administrative costs associated with paper invoicing.
Moreover, as more businesses gain improved access to credit, the manufacturing sector could see increased investments in machinery, workforce, and production capacity, driving industrial growth and job creation. This aligns with the government’s broader agenda of economic diversification and industrialization.
With the July 25 launch date fast approaching, the FIRS continues its nationwide campaign to educate stakeholders across sectors about the benefits and operational mechanics of e-invoicing. Manufacturers and business leaders are encouraged to prepare for the transition to leverage the system fully.
The e-invoicing initiative also presents an opportunity for Nigeria to align with global best practices, enhancing its competitiveness in both local and international markets.