The Federal Government has approved payments to more than 1,240 local contractors, in a move aimed at injecting immediate liquidity into businesses and easing long-standing financial pressures across Nigeria.
The approval was granted by the Honourable Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, following what the Ministry described as a “diligent verification and reconciliation” process to ensure that only valid claims were settled.
According to a statement issued on Monday by the Ministry’s Head of Information and Public Relations Unit, Efe Ovuakporie, the payments cut across various Ministries, Departments and Agencies (MDAs) and are expected to provide relief, particularly to indigenous businesses and small and medium-sized enterprises (SMEs).
Contractors prioritised in the latest tranche are those with verified claims of ₦100 million or less — a decision the government says is designed to spread the economic impact more broadly rather than concentrate payments among a few large firms.
Officials said the release of funds would enable affected businesses to return to project sites, pay workers, settle suppliers and meet other financial obligations, thereby supporting economic activity nationwide.
“The approval… follows a diligent verification and reconciliation undertaken by the Ministry to ensure that only duly validated obligations qualify for payment,” the statement said.
The Ministry described the disbursement as part of efforts to address inherited liabilities in a “transparent and fiscally responsible manner,” adding that it reflects a broader commitment to translating policy into tangible outcomes.
Government figures show that over the past few months, more than ₦700 billion has been paid out across various categories of verified obligations owed to contractors. In May alone, approximately ₦436.6 billion in transactions were processed, signalling what officials called a significant acceleration in payment activity.
Analysts say the strategy of prioritising smaller contractors could have wider ripple effects across the economy, given their role in employment and supply chains.
For many beneficiaries, the payments represent more than just cash flow. The Ministry noted that the funds provide “the certainty needed to sustain operations, preserve jobs, complete ongoing projects, and contribute to economic recovery and growth.”
The government also said the latest move is expected to strengthen confidence among contractors, suppliers and service providers working with public institutions, particularly amid concerns over delayed payments in recent years.
Looking ahead, the Ministry pledged to maintain fiscal discipline while ensuring that legitimate obligations are settled promptly, with the aim of reducing outstanding liabilities, improving public financial management and supporting the delivery of infrastructure and public services.
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