diff --git a/dcfs/app/sftp/__init__.py b/dcfs/app/sftp/__init__.py
index 92eb663..6f523c9 100644
--- a/dcfs/app/sftp/__init__.py
+++ b/dcfs/app/sftp/__init__.py
@@ -51,7 +51,7 @@ def server_factory():
         return DCFSSFTPServer(clients, config)
 
     def sftp_factory(conn):
-        return DCFSSFTPHandler(clients, conn)
+        return lambda chan: DCFSSFTPHandler(clients, chan)
 
     return await asyncssh.create_server(
         server_factory,
diff --git a/dcfs/app/sftp/handler.py b/dcfs/app/sftp/handler.py
index 1b23e04..72ddf5a 100644
--- a/dcfs/app/sftp/handler.py
+++ b/dcfs/app/sftp/handler.py
@@ -18,9 +18,9 @@
 
 
 class DCFSSFTPHandler(asyncssh.SFTPServer):
-    def __init__(self, clients: Clients, *args: Any, **kwargs: Any):
+    def __init__(self, clients: Clients, chan: Any):
         self.clients = clients
-        super().__init__(*args, **kwargs)
+        super().__init__(chan)
 
     def _get_ops(self, path_bytes: bytes) -> tuple[Optional[Ops], str]:
         path = path_bytes.decode("utf-8", errors="replace")
diff --git a/tests/test_sftp_factory.py b/tests/test_sftp_factory.py
new file mode 100644
index 0000000..47ba2a6
--- /dev/null
+++ b/tests/test_sftp_factory.py
@@ -0,0 +1,46 @@
+import pytest
+from unittest.mock import MagicMock
+from dcfs.app.sftp import create_sftp_server
+from dcfs.app.sftp.handler import DCFSSFTPHandler
+
+@pytest.mark.asyncio
+async def test_sftp_factory_logic(mocker):
+    # Mock dependencies
+    clients = MagicMock()
+    config = MagicMock()
+    config.dcfs.sftp.host = '0.0.0.0'
+    config.dcfs.sftp.port = 2022
+
+    # Mock asyncssh.create_server to capture the factory
+    mock_create_server = mocker.patch('asyncssh.create_server', mocker.AsyncMock())
+    mocker.patch('asyncssh.read_private_key')
+    mocker.patch('os.path.exists', return_value=True)
+
+    await create_sftp_server(clients, config)
+
+    # Get the sftp_factory from the call to create_server
+    args, kwargs = mock_create_server.call_args
+    sftp_factory = kwargs.get('sftp_factory')
+
+    assert sftp_factory is not None
+
+    # Simulate asyncssh calling sftp_factory(conn)
+    mock_conn = MagicMock()
+    handler_factory = sftp_factory(mock_conn)
+
+    # It should return a callable (the handler factory)
+    assert callable(handler_factory)
+
+    # Simulate asyncssh calling handler_factory(chan)
+    mock_chan = MagicMock()
+    # We need to mock DCFSSFTPHandler because it calls super().__init__(chan)
+    # which might try to do things with the mock_chan.
+    # Actually, let's just see if it instantiates.
+
+    # Mock SFTPServer.__init__ to avoid side effects
+    mocker.patch('asyncssh.SFTPServer.__init__', return_value=None)
+
+    handler = handler_factory(mock_chan)
+
+    assert isinstance(handler, DCFSSFTPHandler)
+    assert handler.clients == clients