Carbon, the Nigerian digital bank, is set to resume issuing cards this month after a six-month suspension of its card services. The decision to restart card issuance comes in response to changes in its card delivery system and increasing customer demand, the company announced in a statement.
“Our international card provider was expensive, and some of the processes were too cumbersome for the product we want to offer our customers. We examined the flaws in debit card usage in Nigeria and optimized the experience to make it better for customers and businesses,” the statement read.
The fintech has refined its card collection and delivery system, according to a person familiar with the matter. Fintech companies, which typically operate without physical branches, often partner with logistics companies to deliver cards, adding to the costs of issuing cards that are priced in dollars.
Like many neobanks, Carbon initially began issuing cards to retain customers and drive transactions after obtaining its microfinance license. At the time, the fintech described the introduction of cards as “a big step” in its transition from a lender to a licensed microfinance bank.
Despite the growing popularity of bank transfers, cards remain one of the most effective channels for customers to access their funds. For some users, cards represent an easy option to access the cash in their accounts, especially since Carbon operates without an agent network or physical branches.
Offering cards is not about attracting new customers to Carbon; it’s more of an essential service we provide. It’s about providing convenience and retaining our customers.
Carbon’s Spokesperson
However, due to the rising dollar costs of issuing Mastercard and Visa cards and a shift in consumer behavior, many fintechs have reevaluated their card operations. This reevaluation has increased the popularity of Interswitch’s Verve card scheme, with the company issuing 17 million cards for Moniepoint and OPay.
The Verve card faces competition from the central bank’s Afrigo card, as both offer local costs and more accessible requirements. For Carbon, which previously issued Visa cards, the decision was made to discontinue its card operations temporarily and rethink its strategy. The fintech has not disclosed its new card issuer.
