Nigerian fintech company Carbon has announced the cessation of its debit card operations in Nigeria, just two years after launching the service.
This decision was made public by Carbon’s co-founder and CEO, Ngozi Dozie, through a Substack post, where he implied that the introduction of debit cards might have been a strategic misstep.
The shutdown comes in response to significant challenges related to foreign exchange (forex), as the costs of card operations are denominated in dollars.
Dozie reflected on the broader strategy, questioning whether pushing for debit cards was the right move for neobanks in the Nigerian market.
In his announcement, Dozie admitted that many founders, including himself, often introduce new services without thoroughly analyzing the industry.
He acknowledged that, in hindsight, the market was already saturated with debit cards, leading to a redundancy of their service.
Dozie advised fintech startups to conduct comprehensive industry analyses before launching debit card services.
He noted that other fintech companies such as Kuda, Moniepoint, and OPay have managed to introduce debit cards, primarily Verve cards, which give them a local advantage amidst ongoing forex issues.
Carbon’s initial goal with the debit card launch in August 2021 was to transition from a digital lender to a microfinance bank, aiming to provide a comprehensive banking experience.
Despite the setback, the company continues to explore other avenues to enhance its service offerings in the Nigerian financial sector.
