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Use cases for the Developer APIs
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The Developer APIs are designed primarily with lenders in mind, though any organization that wants to onboard genuine, non-fraudulent users can benefit. Here’s how businesses put them to use.
Validation
Validation APIs let you confirm the details your customers provide, giving you assurance that they are who they say they are. See Validation APIs for the full reference.
BVN image match: compare a customer’s profile image against the image on their Bank Verification Number (BVN) to filter out fraudsters impersonating others.
Bank account verification: run a name enquiry check to verify the validity of an account a customer submits. You can go further and cross-reference the BVN linked to the account against the BVN the customer separately provided.
Karma lookup: prevent customers blacklisted for fraud or loan default from onboarding, by checking their email, phone number, or BVN against Karma, one of the largest blacklists of chronic defaulters and fraudsters in the Nigerian credit space. If you’d rather not block sign-up entirely, you can allow potential bad actors to onboard but run a Karma check before letting them take a loan or perform other sensitive actions.
Ecosystem lookup: tap into the Lendsqr ecosystem of borrowers to generate insights on a customer’s credit history and performance with other lenders.
Your customers provide data valuable for scoring, such as BVN and phone number.
Use that data to check Karma for prior fraud or default reports.
Use the Ecosystem lookup to see how the customer has behaved with other lenders, and configure the kind of customers you want to lend to.
Use the Credit Bureau APIs to pull a comprehensive credit report and factor it into your decision.
On top of these checks, Oraculi lets you develop or fine-tune a scoring model: a set of metrics used to determine a person or business’s creditworthiness, built from the Risk Acceptance Criteria (RAC) you define for your loan products. Assign scores to the fields your customers provide and get a cumulative score to decide whether they’re creditworthy. Lendsqr also offers a proprietary scoring model you can use as-is, provided you collect the same fields it expects.
Layering these checks together helps you make better-informed lending decisions while minimizing financial risk.
Credit Bureaus
The Credit Bureau APIs extend our partnerships with CRC Credit Bureau and FirstCentral Credit Bureau, two of Nigeria’s three credit bureaus. See Credit Bureau APIs.
Run a credit history check with either bureau to see whether a customer has a history of defaulting across platforms, or a good credit standing. For maximum coverage, you can run checks against both in sequence, which is more cost-effective than calling both at once.
Customer validation
Verifying a customer’s identity at sign-up protects your business from fraud:
Your borrowers provide their information during sign-up.
Verify their BVN against their date of birth and phone number.
Run a liveness check by comparing a live image against the image linked to their BVN.
If possible fraud is detected, prevent the customer from continuing sign-up or their loan application.
Confirm uploaded identification documents with real-time ID verification.
Direct Debit
The Direct Debit APIs streamline and automate setting up and managing direct debits for your customers. See Direct Debit APIs for the full reference.
Create mandates: create a mandate on a customer’s bank account with the Create Mandate endpoint, then let the customer know the next steps to activate it.
Check bank balances: confirm a customer’s account balance with the lookup APIs before triggering a debit for a loan repayment.
Automate repayments: configure a repayment schedule so neither you nor the customer needs to manually manage repayment.
Loan repayment with Direct Debit
Direct Debit is an automated payment method that lets you collect repayments directly from a borrower’s bank account on agreed dates, without further action from the borrower. Here’s how it works:
Your customer provides the bank account to attach the direct debit mandate to.
As the lender, you create an e-mandate using the customer’s account details.
Your customer activates the mandate by sending ₦50 to the registered NIBSS account number, granting permission to debit their account.
NIBSS makes a ₦100 debit attempt on the borrower’s account, to confirm the account can be debited when repayment is due.
At that point, the mandate is active. You can also configure SMS or email reminders before a debit is made. Using Direct Debit for repayments streamlines your process, ensures timely payment, and helps reduce your Non-Performing Loan (NPL) rate.
Implementing GSI with Direct Debit
Global Standing Instruction (GSI) was created by the Central Bank of Nigeria (CBN) as a last resort for banks and financial institutions to recover outstanding loans from chronic debtors. It lets the creditor bank recover its debt from any account the borrower holds at other financial institutions, in the event of default. GSI aims to improve credit repayment culture, reduce Non-Performing Loans industry-wide, and watch-list consistent defaulters.
Borrower authorization: the borrower authorizes the lender to recover outstanding debt automatically from their accounts across institutions.
Linking accounts: the borrower links all qualifying bank accounts to their BVN.
Triggering GSI: on default, the creditor bank triggers GSI, which runs a balance enquiry and issues debit instructions to other institutions holding the borrower’s accounts.
Executing the debit: the Nigeria Inter-Bank Settlement System (NIBSS) transfers funds from the borrower’s other accounts to the creditor bank.
Corporate cash and treasury management
Optimize your business’s cash flow and financial assets to ensure liquidity, reduce risk, and maximize returns.
Checking balances: the Direct Debit and Kolo APIs give real-time insight into your bank accounts, so you can monitor balances daily and ensure sufficient funds for day-to-day operations.
Transferring funds: use the Direct Debit APIs to automatically move excess funds between accounts, maintaining optimal cash levels.
Saving surplus funds: transfer surplus funds to high-yield savings or investment accounts.
Monitoring and compliance: maintain oversight of your funds to comply with financial regulations and corporate policy.
BNPL lets your customers buy now and pay in installments, boosting sales and improving customer satisfaction and loyalty.
Seamless integration: integrate our verification, scoring, and payment APIs into your e-commerce platform to offer BNPL at checkout.
Instant approval: our scoring APIs process customer information in real time, providing instant approval or denial for a BNPL request; you can configure this to be automatic or reviewed manually.
Flexible payment plans: configure daily, weekly, or monthly installment schedules to fit your business model.
Done well, this increases sales, reduces your NPL rate, and improves customer satisfaction. See the Rent Now Pay Later case study for a deeper look at building BNPL-style flows on these APIs.
Embedded credit and finance
Integrate financial services directly into your platform to enhance the customer experience and open new revenue streams. Manage the entire lending process, from application through verification, decisioning, approval, disbursement, and collection, inside your own product. See Embedded loans and payments.
Need help mapping a use case to specific endpoints? Email [email protected].
