Nigerian digital bank Carbon has partnered with Verve, the Interswitch-owned card scheme, to resume issuing debit cards to its customers. This move comes nine months after Carbon paused its card operations due to high costs and cumbersome processes associated with its previous partnership with Visa.

The partnership with Verve marks a significant shift in Carbon's debit card strategy, as the fintech startup seeks to provide convenience and retain its customers. According to Lotanna Anuforo, Carbon's content manager, "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 decision to discontinue its Visa card partnership was largely driven by the high costs associated with maintaining international card schemes. These costs, which are typically dollar-based, have become increasingly burdensome for fintechs in Nigeria, particularly those without physical branches. Additionally, the reduced international customer spending has further exacerbated the issue.

The partnership with Verve is seen as a strategic move by Carbon to reduce costs and increase efficiency. Verve, which has issued over 70 million cards, is a dominant player in the Nigerian market, and its partnership with Carbon is expected to drive further growth. Other major Nigerian fintechs, such as Moniepoint and OPay, have also issued over 17 million Verve cards, while most Nigerian banks issue Verve cards for their customers.

The shift towards Verve is part of a broader trend in Nigeria, where fintechs are increasingly opting for local card solutions. This trend is driven by the need to reduce costs and increase efficiency, as well as the growing adoption of contactless payments and bank transfers. Despite the rise of these alternative payment methods, debit cards remain a crucial channel for customers to access their funds, and fintechs like Carbon are recognizing the importance of offering this essential service to their customers.

The resumption of debit card issuance by Carbon is expected to have significant implications for the Nigerian fintech industry. As more fintechs turn to local card solutions, the industry is likely to see increased competition and innovation. Additionally, the partnership between Carbon and Verve is expected to drive further growth and adoption of digital banking services in Nigeria.

In conclusion, Carbon's partnership with Verve marks a significant shift in the Nigerian fintech industry, as fintechs increasingly recognize the importance of offering debit cards as an essential service to their customers. As the industry continues to evolve, it will be interesting to see how this partnership shapes the future of digital banking in Nigeria.