Nigerian open-finance startup Zeeh Africa has reintroduced its Direct Debit feature as part of a broader push into payments infrastructure, aiming to solve one of the most persistent challenges in the country’s fast-growing digital lending sector: ensuring borrowers repay their loans.
The relaunch comes against a backdrop of weakening loan performance. According to the Central Bank of Nigeria’s Credit Conditions Survey for Q2 2025, defaults on unsecured loans have risen, with a net balance of -1.5 indicating higher delinquency rates. The surge in digital lenders—more than doubling in the past two years—has made access to uncollateralized loans easier, but repayment remains a major pain point.
David Adeleke, CEO of Zeeh Africa, stated:
The irony of Nigeria’s fintech boom is that while we’ve made it incredibly easy to disburse loans, we’ve remained inefficient at collecting repayments. Manual follow-ups, failed transfers, and broken promises create a cycle where good borrowers get lumped with bad ones.
Direct Debit enables businesses to automatically debit customers’ accounts on agreed dates, provided they have consented. In a market where lenders relied heavily on manual reminders and repeated calls as recently as 2024, automated debit flows are becoming critical for credit providers, BNPL firms, and subscription businesses struggling with inconsistent payments.
Founded in 2022 by Adeleke and Frank Uwajeh, Zeeh Africa provides APIs that allow financial service providers to access bank data, verify identities, assess creditworthiness, and automate lending workflows. Adeleke said the initial version of Direct Debit, launched in 2024, was shut down for a complete overhaul. “The traction we were getting last year was undefined, so we needed a better system. This time, we have proper tracking and usage metrics,” he explained.
The beta version launched in February onboarded 20 businesses, including digital lenders, school-financing platforms, and subscription services. The product now powers 22 businesses, while Zeeh’s broader suite—including ID verification, bank data access, credit-risk analysis, and automated recovery tools—serves 150 enterprises. “We’ve processed over 5 million API calls year-to-date,” Adeleke noted, highlighting Zeeh’s open banking focus on data sharing, KYC, credit insights, and bureau-driven credit history analysis.
Key Features of Direct Debit
- Installment and recurring payments: Customers can structure repayments and authorize recurring transactions.
- Mandate-based authorization: Signed mandates define debit limits and duration, ensuring transparency.
- Automation: Scheduled debits and real-time status updates reduce operational burdens for lenders.
Ogechi Mbaka, Zeeh’s product manager, commented:
We’re seeing strong interest from pay-later companies that have solid underwriting but struggle with collections. Instead of employing large collections teams or accepting 30% default rates, they can automate repayment flows while maintaining transparency.
The mandate-based system aligns with FCCPC’s July 2025 digital lending regulations, which require consent-driven repayment methods and prohibit aggressive collection practices.
Despite the innovation, Zeeh faces stiff competition from well-funded incumbents like Flutterwave, Paystack, Moniepoint’s Monnify, Kora, and Mono, all of which offer similar products. Zeeh’s differentiation strategy is to integrate the entire credit lifecycle—identity verification, affordability checks, bank statement analysis, and payments—into a single infrastructure layer, reducing the need for lenders to stitch together multiple providers.
Looking ahead, Zeeh plans to expand Direct Debit to additional payment rails and extend availability beyond Nigeria through UseZeeh, a unified gateway for APIs and developer tools. The big question remains: Can Zeeh scale fast enough to capture market share from entrenched players already powering recurring payments across Africa?
