Factoring is a financing tool that helps businesses, particularly small and medium-sized enterprises, manage their working capital and use assets recorded in their financial statements as a form of collateral to obtain financing. By providing liquidity to these companies, factoring contributes to their growth and enhances their role in the economy.
With support from the European Bank for Reconstruction and Development, a draft factoring law was prepared in line with local legislation and best practices. During 2025, the PCMA team and the legal team appointed by the European Bank for Reconstruction and Development completed the final review of the draft and its alignment with the Model Law on Factoring issued by the International Institute for the Unification of Private Law (UNIDROIT). The teams also prepared an explanatory memorandum and a legislative policy paper for the law in both Arabic and English. The draft law, explanatory memorandum, and legislative policy paper will be presented to the PCMA Board of Directors and then shared with relevant institutions and the public for discussion.
