Five months ago, we launched Mono Direct Debit in private beta to transform the way businesses accept recurring payments from their customers.
In the course of those five months, we worked behind the scenes with the feedback we got from our early-use partners, to improve the recurring payment experience that Mono Direct Debit brings. Today, we’re excited to share that Mono Direct Debit is now live and publicly available to all businesses operating in Nigeria.
As an addition to our DirectPay product, the Mono Direct Debit solution allows businesses across various industries to securely and more reliably collect single and recurring payments from customers’ accounts, with their permission. In the African market, this is critical infrastructure for businesses like lenders, Buy Now Pay Later providers, insurance companies, or SaaS startups, and any subscription services that need to directly debit customers’ accounts for scheduled payments.
Types of Mono Direct Debit
With Mono Direct Debit, you can set up post-dated, variable, and fixed mandates on customers’ bank accounts to collect payments across multiple financial institutions and account types. Here are the types of payments you can collect using Mono Direct Debit:
Post-dated payments - Post-dated payments allows your business to schedule a single direct debit transaction on a customer’s account, for a specific date in the future.
Variable recurring Payments - These payments enables you to collect varying or unspecified amounts split over a schedule, and with a set transaction limit.
Fixed recurring payments - Fixed recurring payments allow you to regularly debit the same payment amounts over a set interval.
How Mono Direct Debit works
Mono Direct Debit enables you to set up payment instructions called mandates on customers’ account via a single API. These mandates have to be authorized by the customer before you can initiate a direct debit transaction from their account.
There are two types of direct debit mandates which you can set up on a customer’s account.
Types of Direct Debit mandates
E-mandate: With E-mandate, the customer has to transfer NGN 50 from the linked account to approve the payment mandate. The approval time for the e-mandate usually takes 1 - 3 minutes, and a waiting period of 8 - 12 hours is required before the mandate is active on the customer’s account, and you can initiate a debit transaction or check the balance on the account. This mandate type can also be set up on both personal and business accounts.
Signature mandate: The signature mandate requires the customer to authorize the mandate on their accounts using their signature. Then, the bank has to verify the signature and possibly reach out to the customer to confirm the mandate set on their account. Approval by the bank can take between 1 hour to 72 hours, depending on the bank, however, once it is approved, you can instantly debit the customer’s account or perform a balance check. You can create the signature mandate type for personal, joint, and business accounts.
How your customers can use the new Mono Direct Debit widget
To enable customers to authorize a direct debit mandate on their accounts, businesses previously had to build a custom UI interface within their service using the Mono Direct Debit API.
We recently improved this experience and built a more seamless mandate authorization flow, with the introduction of the new Mono Direct Debit widget. This ensures that businesses that use Mono can have all the tools they need to securely collect recurring payments without spending time building a separate authorization flow for their users.
With the Mono Direct Debit widget, your customers can easily approve a mandate on their accounts using their preferred authorization method and account type, all within your app.
Here’s how a direct debit mandate can be authorized by a customer via the Direct Debit widget:
The customer selects their preferred bank.
They choose the account type (personal, business, or joint account).
The customer verifies ownership of the account with their login credentials, to complete the account linking.
The customer authorizes the mandate by transferring NGN 50 to a NIBSS account (e-mandate), or via a signature which will be confirmed by the account holder's bank.
After the mandate agreement is set up, you can now directly debit payments from the customer’s account, as agreed.
How your business can use Mono Direct Debit
Loan repayments: Lending and BNPL companies can use Mono Direct Debit to easily collect repayments for loans over a specific duration. This allows you to enable borrowers to authorize a mandate on their accounts so you can directly debit their accounts on schedule for loan repayments, without relying on cards.
Subscription payments: SaaS or subscription-based services need to collect regular payments from users on the due dates. Mono Direct Debit allows you to set up mandates on users’ account so you securely charge them for automated payments for the services you are providing to them, and reduce the chances of late or missed payments.
Regular account top-ups: Businesses offering investment, insurance, or any financial services can use Mono Direct Debit to allow their users to set up mandates on their accounts to make scheduled account/wallet top ups, portfolio funding, and insurance premiums to your businesses.
Why your business should use Mono Direct Debit
Mono Direct Debit empowers businesses of all sizes from startups, to growth-stage companies, and enterprises with an innovative payment collection solution that simplifies how they accept and manage automated payments. Here are some of the ways using Mono Direct Debit will benefit your business:
1. Faster payment collection
Mono Direct Debit is built on top of the NIBSS mandate service and independent of existing payment rails and networks, which provides businesses with a faster, cheaper, and alternative payment collection method for automated debits and subscription payments.
2. Multiple institutions
You can instantly set up mandates and collect recurring payments from customers across 30+ financial institutions in Nigeria.
3. Diverse account types
Create direct debit mandates across personal, business, and joint accounts, so customers with different account types can pay your business easily.
4. Seamless mandate setup
You can set up mandates on customers’ accounts via a simple API implementation. Your users can also securely authorise these payment mandates in less than 5 minutes via the Direct Debit widget.
5. Flexible settlement schedule
With Mono Direct Debit, you can choose between two settlement methods. Payouts can be settled instantly to a beneficiary account after a successful direct debit transaction, or all payouts can be settled into your bank account on the next business day (T+1).
6. Smart retrial system
Our robust direct debit mandate management system ensures that all unsuccessful debits are automatically retried for improved success rates.
Getting started with Mono Direct Debit
If you already have a Mono account
Create an app and with the scope set to DirectPay
Follow this guide to request access to Direct Debit or email us at support@mono.co
Check our integration guide to learn how to implement the Direct Debit API to create and initiate a mandate on customers’ accounts
If you're using Mono for the first time
Create a free Mono account (mono.co/signup)
Create an app on the dashboard and set the product scope to DirectPay
Follow this guide to request access to Direct Debit or email us at support@mono.co
Learn how to implement the Direct Debit API to create and initiate a mandate on customers’ accounts
Common questions you might have and answers to them
1. Is Mono Direct Debit available to all the countries Mono serves?
No, Mono Direct Debit is currently available to businesses operating in Nigeria.
2. How much does it cost to collect payments with Mono Direct Debit?
For every successful direct debit payment, you’ll be charged a 1% transaction fee capped at NGN 1000.
3. How long does it take for a mandate to be approved?
This depends on the authorization method and varies from bank to bank, however e-mandates take 1 minute while the approval time for signature mandates take between 1 hour to 72 hours.
4. Can you set up multiple mandates on one account?
Yes, you can but you will need to wait for one mandate to be approved before you can set up a new one on that same account. Please note that you also cannot initiate the same amount and mandate type on an account, that is, if an e-mandate of ₦20,000 is created on an account, you can't set up another e-mandate of ₦20,000 running on the same account.
If you have more questions or feedback to share, please email us at support@mono.co — we'd love to hear from you!
