For anyone running a lending business, getting paid on time is the number one priority. Now that a significant portion of lending is digital, getting paid online is very critical. This is where many lenders get into arguments about which of Flutterwave or Paystack is better for loan collection.

We decided to find out for our lenders.

Paystack vs. Flutterwave: At a glance

Paystack and Flutterwave are undoubted leading payment providers in Nigeria and Africa. Both were founded early in the Nigerian fintech revolution. They are both Y Combinator alumni.

Paystack and Flutterwave provide payment solutions that allow business owners to receive payments from their customers from almost anywhere in the world. They pride themselves in offering a seamless payment experience to both customer and business owner. These payment gateways also offer payment through multiple channels. Businesses can accept payments via cards, USSD, bank transfers, payment links and even payments via POS are the works.

These two companies have planted themselves at the forefront of payments processing in Nigeria (and beyond) and are the go-to brands. They have evolved over time to offer more financial services and products beyond a digital payments platform. However, for the purpose of this article, we’ll focus on their payments services and compare the suitability of each platform’s offerings for loan collection.

Paystack vs. Flutterwave: Getting started

Paystack asserts that businesses can be up and running on their platform in less than 15 minutes. Apart from basic personal details, registered business owners are required to provide their corporate bank details and company registration documents. There’s also an allowance for unregistered starter business owners to sign up with their bank verification number (BVN), valid government-issued identification and personal bank account details. Sign up is free.

Getting started on Flutterwave is also free and Flutterwave promises to have businesses start collecting real payments within 5 minutes while they continue setting up their account.


We would score both 5 out of 5. The difference between 5 and 15 minutes is minimal for a long term technical relationship.

Paystack vs. Flutterwave: Integrations and developer resources

Paystack’s APIs are well-documented. Lenders can create custom payment flows that support loan collections from thousands of borrowers. Additionally, Paystack doesn’t charge integration or maintenance fees and integrates well with other platforms.

Flutterwave also has well documented APIs that are simple to work with to create a custom payment experience for borrowers. The payment processor also works well with other platforms such as Shopify.

Both Paystack and Flutterwave only charge when transactions initiated on their platform are successful.


We would score Paystack and Flutterwave 5 out of 5 each. Both have clearly documented APIs and the process to start using them is simple for any developer to comprehend.

Paystack vs. Flutterwave: Pricing

It goes without saying (but we’ll say it) that lenders have good reason to try to keep their costs as minimal as possible. There’s only a small percentage of the cost burden that can legally be transferred to borrowers. And if more of the costs could be transferred to borrowers, loans will be way too expensive. Paystack and Flutterwave charge the following for transactions:


For local transactions: The transaction attracts a fee of 1.5% + NGN100. However, the N100 is not charged for transactions below N2,500 and the maximum fee that can be charged on local transactions is N2,500.

For International transactions: The transaction attracts a fee of 3.9% + NGN100. Paystack can settle in either Naira or USD.


For local transactions: This costs 1.4% per transaction with the fee capped at N2,000 per transaction.

For International transactions: This attracts a charge of 3.8% per transaction.


We would give Paystack 4.5 and Flutterwave 5 as over time, that N100 and 0.1% margin can quickly add up. For example, for a N10,000 repayment, a lender would pay N250 with Paystack and N140 when using Flutterwave to collect the same amount. Over 3,000 loans, this adds up to N330,00.

Paystack vs. Flutterwave: Payments processing

This is the crux of the matter. In this section, we’ll examine the features that Paystack and Flutterwave offer towards payments processing. We’ll also determine which payment processor’s offerings are more suitable for loan collections.


Paystack can process transactions towards loan repayment from both local and international sources. This means lenders can get paid by borrowers, even if they’re not within the same country. “I’m out of the country at the moment” isn’t an excuse for borrowers not to pay their debt.

Paystack also offers lenders multiple payment channels as it supports payments from bank accounts, cards, mobile money operators, USSD, Visa QR and Apple Pay. The payment processor has also announced that payments via POS will also be available soon. This gives borrowers the chance to pay lenders through means most convenient for them.

In addition to borrowers being able to repay via multiple channels, Paystack offers lenders the functionality of setting up recurring payments and partial debits. This gives lenders the chance to collect loan payments seamlessly and automatically when a loan is due. Deductions towards loan repayment can be made from the borrower’s card installmentally, until the loan is fully settled. Lenders don’t always have to wait on borrowers’ manual efforts to get paid.

With Paystack, lenders can get settled for loan payments within 24 hours. Where a borrower has been wrongfully debited without value for that transaction, Paystack has an automated chargeback mechanism put in place where lenders may request a refund.

The biggest deal with using Paystack for loan collection is partial debit. Nigerians being who we are, many borrowers don’t have the complete amount due in their account. Partial debit allows lenders to be paid, say N45,000 out of N50,000 if that is what the borrower has in their account on the due date.


Similar to Paystack, Flutterwave also offers a convenient way to process both local and international payments. The payment processor accepts payments via cards, bank transfers, QR code, USSD and MPesa. Contrary to Paystack, Flutterwave has already gone live with their POS payment solution.

Furthermore, Flutterwave supports payment via payment links; the equivalent of the payment pages offered by Paystack. Borrowers can repay loans using these unique payment links from anywhere.

When it comes to processing payments, Flutterwave and Paystack offer similar stellar services . However, Flutterwave has a wider coverage in Africa and their customers are able to receive and hold foreign currency in their overseas accounts. This makes them more suitable for lenders whose primary focus is expanding their operations outside Nigeria.


Because payments is core to lending, Paystack’s ability to do partial debit gives it a significant edge over Flutterwave. Here we would give Paystack 5 and Flutterwave 3.5.

Paystack vs. Flutterwave: Payment channels

Card is just one of the channels to get paid but other options such as virtual account, USSD, QR, etc are rapidly growing. While cards are used to pull transactions from the borrower’s account, other channels are good for customers making payments by themselves.

Paystack supports cards, USSD, bank transfers, virtual accounts, and mobile money which makes it versatile.

Flutterwave also accepts payments from all channels that Paystack supports alongside other channels like Mono and its proprietary Barter platform.


Flutterwave provides more channels for accepting payment of the two although some of these channels are proprietary and fringe. We would award Flutterwave with 4 while Paystack gets 3.5. Both lose valuable scores for not supporting the direct debit mandate system.

Paystack vs. Flutterwave: Transaction success rate and platform stability

Besides borrowers who don’t want to repay, the next thing lenders don’t want is not being able to get paid by borrowers who do want to repay. The stability of payment gateways is of utmost priority where loan collection is concerned. Both Paystack and Flutterwave have shown that their payment processing systems have maintained a high level of consistency over time.

Paystack makes the bold claim that it has the best transaction success rates in the sector, stating that “if a transaction fails on Paystack, it’s improbable it’ll work anywhere else”. Paystack’s card transactions success rate can be attributed to their direct integration into some of the biggest banks in Nigeria. The payment processor also dynamically selects the best payment paths and processors for each transaction, assuring high success rates.

Flutterwave also boasts of a safe and secure digital payments interface that reduces the friction of processing payments locally and globally.


The two payment giants are fairly robust and stable; we would heartily award them 5 each.

How to select the best payments provider for a lending business

The variables by which we have assessed Paystack and Flutterwave are important and not exhaustive. A dedicated analyst probably could have tons of other metrics to compare and contrast. However, the ones we have reviewed are cogent to the everyday digital lenders.

Paystack narrowly edged out Flutterwave with a score of 28 against Flutterwave 27.5. Both fail at providing direct debit via mandates which are proven to be more reliable and cheaper to run for lenders than payment cards.

The reality is that both Paystack and Flutterwave have proven themselves over the years. They have become household names in payment processing in Nigeria; from big businesses to freelancers. Additionally, their competitive price makes it difficult to choose between them.

Making the decision between whether to use Paystack or Flutterwave for loan collections, ultimately comes down to which is better aligned with lenders’ collections and business needs. This owes to the fact that  platforms are capable of accepting payments both internationally and domestically.

In addition, both Flutterwave and Paystack have reliable customer support, even though response times may slow down during peak hours.

The cherry on top of all this is that lenders don’t have to worry about integrating with a payment processor on their own. Instead, lenders can immediately start using Paystack for loan collections for free when they sign up on Lendsqr.

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