Startup Lagos

25-Mar-2025

Acquisition

ClearGrid Secures $10M to Modernize Debt Collection in MENA with AI 1 month ago

Debt collection in emerging markets has long faced challenges characterized by inefficiencies, high costs, and practices that often undermine borrower trust. As consumer lending continues to expand and regulators advocate for more ethical approaches, traditional debt recovery firms are finding it increasingly difficult to adapt.

In response to these pressing challenges, Dubai-based startup ClearGrid has emerged with innovative AI-powered solutions aimed at transforming the debt collection landscape. The company has successfully secured $10 million in funding, comprising $3.5 million in pre-seed investment and $6.5 million in seed funding. ClearGrid's mission is to assist banks, fintech companies, and lenders in enhancing debt recovery processes while minimizing the reliance on aggressive collection tactics.

Founded in May 2023, ClearGrid has quickly garnered strong support from investors. CEO Mohammad Al Zaben views this funding as a strategic advantage that will bolster the company's ambitious plans in a rapidly growing market.

Al Zaben's interest in revolutionizing debt collection stemmed from his experience selling his previous startup, Munch: On, to Careem in 2022. Following the acquisition, he took time to reflect on one of Munch: On's significant challenges—managing payments from corporate clients. This experience prompted him to delve into receivables management and consumer debt collection, where he discovered that many outdated methods were still in widespread use.

Many collection agencies were still relying on antiquated systems, with some even using pen and paper. Even the most advanced firms depended on basic CRM tools. Collection efforts were predominantly manual, often employing scare tactics that left borrowers with negative experiences.

With regulators in Saudi Arabia and the UAE increasingly emphasizing consumer protection, the urgency for modernization became clear. Simultaneously, the consumer lending sector was experiencing rapid growth, with buy now, pay later (BNPL) companies like Tabby and Tamara processing billions in transactions and unsecured lending reaching unprecedented levels in the Middle East.

Recognizing this opportunity, Al Zaben partnered with Khalid Bin Bader Al Saud and Mohammed AlKhalili to establish ClearGrid. Despite their lack of direct experience in the collections industry, they developed AI-driven software designed to enhance debt recovery while collaborating with existing vendors.

ClearGrid's AI-powered approach aims to enable lenders to recover outstanding debts more efficiently while preserving positive relationships with borrowers. As lending volumes rise, regulatory requirements tighten, and AI continues to transform various sectors, the founders believe this is the opportune moment to introduce a new model for debt resolution.

This funding represents a significant first step toward building an advanced infrastructure for more effective and ethical debt collection practices in the MENA region.

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