Ngozi Dozie, the CEO and co-founder of Carbon, on Wednesday has revealed on Substack that two years after its founding, the Nigerian fintech company, Carbon, has closed its debit card business in the country.
Dozie’s post implies that the corporation might have made a mistake in introducing cards, even if he did not provide a clear explanation for why the card service was discontinued.
Continuing, considering that Carbon’s card costs were in dollars, the present forex issue may have also had a role in the card company’s closure.
He disclosed, “When I take a step back with the benefit of hindsight (and a card operation bill denominated in USD$), I question why practically all neobanks are pushing cards or even getting into it. Was this the right strategy for ALL of us, or was Carbon just unlucky?”
Founders’ Errors
He stated he would not have started the card operations if he had done a thorough industry research, pointing out that many founders frequently make the error of operating on incomplete information without adequate analysis.
In retrospect, Dozie admitted that numerous debit cards are already in the possession of Nigerians. “If I had done the analysis…and truly evaluated the opportunity, I don’t think I would have been that gung-ho about pushing a strategy to provide consumers with their fifth debit card. The decision might have been the same, but perhaps with more respect for the potential risks.
“Maybe I had a scoop that if we launched a debit card, customers would trust Carbon more. Because, hey—just like those big banks you trust, I have the same bright, shiny card, marketed on billboards with happy-go-lucky youth with funky haircuts and bright clothing,” he stated.
He admonished that before venturing into the debit card market, fintech businesses contemplating its introduction should conduct a thorough analysis of the market.
While Carbon’s card was introduced in collaboration with Visa, an international card provider, OPay, Moniepoint, and Kuda are introducing Verve cards, which gives them a local advantage, particularly in light of the current forex challenge. It is useful to know that fintechs like Kuda, Moniepoint, and OPay, among others, have currently started offering debit cards to their clients.
The launch of Carbon’s debit cards in August 2021, is described it as the “big step in the company’s transition from being Nigeria’s biggest digital lender to a microfinance bank licensed by the CBN.”
Before launching, the company disclosed that “With the debit card, Carbon bank account holders will now be able to spend funds in their accounts via online and offline channels like ATMs and POS machines. More importantly, Carbon is prioritizing user experience, a trending issue among customers of financial institutions.”
However, the banking and finance news shows that the company continued by saying it intended to expand on its 3 million customers at the time by providing a more comprehensive banking experience for individuals with varying demands with the launch of cards.
