Is debt collection stuck in the dark ages? For many in the Middle East and North Africa (MENA), the answer is a resounding yes. Imagine outdated processes, costly inefficiencies, and borrowers feeling harassed – it’s a recipe for disaster in emerging markets. But hold on, a fresh wave of innovation is here! ClearGrid, a Dubai-based startup, just secured a powerful $10 million in funding to inject some much-needed AI in Debt Collection into the MENA region. Let’s dive into how they’re planning to shake things up and why this could be a game-changer for both lenders and borrowers. Modernizing Debt Collection MENA with AI: A New Dawn Traditional debt collection in MENA is facing a perfect storm. Consumer lending is booming, regulators are demanding fairer practices, and old-school methods are simply not cutting it. ClearGrid is stepping into this gap, armed with cutting-edge AI , to transform how debt is recovered. Here’s the lowdown: The Problem: Legacy debt collection often relies on outdated systems and aggressive tactics, damaging borrower trust and hindering recovery rates. ClearGrid’s Solution: They’re building an AI-driven platform to modernize the entire process, making it more efficient, ethical, and effective. The Funding Boost: A significant $10 million in funding (pre-seed and seed) signals strong investor confidence in ClearGrid’s vision and potential. The Mission: To help banks, fintechs, and lenders in MENA recover more debt while fostering better relationships with customers – no more harassment! Mohammed Al Zaben, ClearGrid’s co-founder and CEO, brings a unique perspective to this challenge. After his previous startup, Munch:On, was acquired by Careem, he recognized a critical pain point: efficient payment collection. This led him to explore the world of receivables management and, crucially, the often-problematic realm of consumer debt collection. What he found was an industry ripe for disruption. Why Now? The Perfect Storm for Fintech Innovation in Debt Recovery Al Zaben’s deep dive revealed a stark reality: many debt collection agencies in MENA were operating with outdated technology, some even relying on pen and paper! Even the more advanced agencies were only using basic CRM systems. This meant: Outdated Methods: Heavy reliance on manual processes and scare tactics. Poor Borrower Experience: Aggressive collection practices led to borrower frustration and distrust. Regulatory Pressure: Regulators in Saudi Arabia and the UAE are increasingly focused on consumer protection, demanding fairer practices. Booming Lending Market: The rise of BNPL services and unsecured lending created a larger pool of debt to manage, exacerbating existing inefficiencies. This confluence of factors created a massive opportunity for Fintech Innovation in debt collection. Al Zaben and his co-founders, Khalid Bin Bader Al Saud and Mohammed Khalili, despite lacking prior experience in the collections industry, jumped in to create ClearGrid. Their vision? To leverage software and AI to not just streamline debt recovery but to partner with existing vendors in the space, creating a collaborative ecosystem. “At a time when lending is booming, regulations are tightening, and AI is reshaping industries, we see this as an opportunity to help lenders recover debt while building trust with borrowers,” Al Zaben stated. Bader Al Saud added, “This is just the first step in building the infrastructure for the future of debt resolution.” How Does ClearGrid’s Automated Debt Recovery Work? ClearGrid acts as a bridge between lenders and borrowers, employing AI to automate and optimize the entire debt collection lifecycle. Here’s a breakdown of their Automated Debt Recovery process: Seamless Integration: Lenders integrate with ClearGrid’s platform via API, easily sending borrower account information. AI-Powered Insights: ClearGrid’s AI models analyze vast datasets to: Score repayment likelihood. Predict customer behavior patterns. Personalize communication strategies across various channels. Intelligent Automation: A staggering 95% of ClearGrid’s operations are automated, including AI voice agents that handle a massive volume of calls daily. Human Touch When Needed: For borrowers who prefer human interaction, the platform facilitates direct conversations, ensuring a balance between automation and personalized support. Crucially, these interactions also feed valuable data back into ClearGrid’s AI models, continuously improving their effectiveness. Categorization and Personalized Repayment Plans: ClearGrid’s system categorizes borrowers based on their capacity and willingness to repay. It then structures manageable repayment plans, encouraging repayment through positive nudges rather than aggressive tactics. ClearGrid claims its platform can slash collection costs by an impressive 50%. According to Al Zaben, “We’re building purpose-built tools and finding ways to make lenders better at what they do while also creating an opportunity for consumers to get out of debt.” Since launching in 2024, ClearGrid reports significant traction, managing hundreds of millions in debt portfolios and partnering with ten major fintechs and banks in the UAE. They cite impressive results: Client Type Improvement Major Bank 30% increase in recovery rates, 50% reduction in collection costs Leading BNPL Provider Doubled recoveries by automating early-stage debt resolution Overall, ClearGrid asserts that it resolves debts twice as fast as traditional agencies, achieving resolution rates between 38% and 50%, with borrowers engaging with their platform 60% more. Their revenue model is based on a percentage fee on recovered amounts, and they are experiencing a remarkable 30% month-on-month revenue growth in the UAE, where they are already profitable. Saudi Arabia is next on their expansion roadmap. Looking Ahead: 10x Growth and Building the Future of Credit Orchestration With the newly secured funding, ClearGrid has ambitious plans to “10x” its revenue and the number of accounts managed in 2024. Currently, they engage with over 130,000 borrower accounts monthly. To support this growth and further enhance their platform, ClearGrid plans to double its engineering team in the next fiscal quarter. Al Zaben envisions building the “definitive credit orchestration infrastructure for the region.” ClearGrid’s impressive investor roster includes prominent MENA-focused VCs like Beco Capital, Nuwa Capital, and Raed Ventures, alongside notable angel investors from Silicon Valley and beyond. This blend of regional expertise and global vision positions ClearGrid for significant impact in the Debt Collection MENA landscape. ClearGrid is not just about recovering debt; it’s about reimagining the entire process. By harnessing the power of AI , they are building a future where debt resolution is more efficient, ethical, and ultimately, more human. To learn more about the latest AI trends, explore our articles on key developments shaping AI innovation .
