Nigerian Fintech Carbon Halts Debit Card Service Nearly Three Years After Launch

Nigerian fintech startup Carbon has ended its debit card service in Nigeria, just over two years after its launch. Ngozi Pascal Dozie, the co-founder and CEO of Carbon, announced the news in a Substack post on June 19, 2024.

While Carbon did not provide a specific reason for ending the debit card service, Dozie hinted that the decision might have been hasty. In his post, he questioned why many neobanks, including Carbon, rushed into offering debit cards. He reflected, “With hindsight and a card operation bill in USD$, I question why practically all neobanks are pushing cards. Was this the right strategy for ALL of us, or was Carbon just unlucky?”

Dozie realised that Nigerian customers already had plenty of debit cards. He admitted that many startup founders, including himself, often make major decisions with little information. If he had thoroughly analysed the strategy and evaluated the opportunity, Carbon might have avoided entering the debit card market. “The decision might have been the same, but perhaps with more respect for the potential risks,” he said.

He also acknowledged that Carbon launched its debit card service for the wrong reasons. Carbon informed all its debit card holders via email that the service would end on June 19, 2024, and sent several reminders to ensure customers were aware.

Carbon introduced its debit cards in August 2021, calling it a significant move in transitioning from Nigeria’s largest digital lender to a microfinance bank licensed by the Central Bank of Nigeria (CBN). The launch aimed to allow Carbon bank account holders to use their funds for both online and offline transactions, including ATMs and PoS machines.

Carbon added that it would use its newly introduced cards to build on its customer base of 3 million users by offering a more complete banking experience. Moniepoint, Kuda, OPay, and other fintechs have also rolled out debit cards for their customers. However, unlike Carbon, which partnered with international card provider Visa, these other neobanks are issuing Verve cards. This gives them a local advantage, especially amid the ongoing forex fluctuations.