Carbon, the Nigerian digital bank, is set to resume issuing cards this month after a six-month pause. The decision to restart the card services came after the company made changes to its card delivery system and noticed an increase in customer demand.
According to a spokesperson for Carbon, the decision to halt card issuance was due to the high costs associated with their international card provider and the complex processes involved. The company took this time to review the flaws in debit card usage in Nigeria and aimed to optimize the customer experience, making it more efficient for both customers and businesses.
One insider mentioned that Carbon has refined its card collection and delivery system during this break. Typically, fintech companies like Carbon partner with logistic companies to deliver cards since they do not have physical branches. This partnership adds to the costs of issuing cards, which are usually priced in dollars.
When Carbon first started issuing cards after obtaining its microfinance license, it was seen as a significant milestone in their transition from a lender to a licensed microfinance bank. Despite the increasing popularity of bank transfers, cards remain a crucial channel for customers to access their funds, especially for those who do not have access to physical branches or agent networks.
The spokesperson emphasized that offering cards is not just about attracting new customers but also about providing convenience and retaining existing customers. However, due to the rising costs of issuing Mastercard and Visa cards in dollars and changes in consumer behavior, many fintech companies have reevaluated their card operations.
This reevaluation has led to an increase in the popularity of local card schemes like Interswitch’s Verve card, which has issued millions of cards for companies like Moniepoint and OPay. The Verve card faces competition from the central bank’s Afrigo card, both of which offer local costs and more accessible requirements.
For Carbon, which previously issued Visa cards, the decision to discontinue card operations was a strategic move to reassess and improve its processes. The company has not disclosed its new card issuer at this time.
As the fintech industry in Nigeria continues to evolve, providing efficient card services remains a priority for companies like Carbon. With the changes in the card issuance landscape, customers can expect more convenient and cost-effective options for accessing their funds in the future.
