Nigerian investment solutions platform, Risevest, has informed its users of the upcoming discontinuation of its virtual card service. In an official communication sent via email, the company announced that the cards will cease functioning effective September 30, 2024.
Risevest attributed the shutdown to a combination of factors, including ongoing challenges with its card providers, fluctuating exchange rates, and delays in resolving customer issues. These operational difficulties made it increasingly unsustainable to continue offering the virtual card service. The fintech company is automatically transferring any remaining funds on the cards to Rise wallets, ensuring customers keep their money after the service ends.
However, while these reasons were cited as the official causes of the shutdown, investigations conducted by Techmoonshot have revealed a more concerning trend within Nigeria’s virtual card space. According to sources familiar with the matter, virtual cards have increasingly become a tool for chargeback fraud, with some fraudsters using the service to exploit vulnerabilities in the system.
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This rise in fraudulent activities has added pressure to fintech companies like Risevest, which are already grappling with economic and operational challenges. The growing incidence of chargeback fraud may have played a significant, albeit unspoken, role in the decision to shut down the service.
Risevest’s move is not unique, as it mirrors similar actions taken by other Nigerian fintech companies such as Carbon, Eversend, Klasha, Busha, GetEquity, and Flutterwave’s Barter. These platforms have also faced difficulties maintaining their virtual card services in recent months, highlighting the broader challenges in managing such offerings within Nigeria’s turbulent financial ecosystem.
In response to the concerns over the service’s discontinuation, Risevest encouraged its customers to remain calm. The company reiterated its commitment to developing more secure and efficient financial tools that better align with users’ evolving needs. Although the virtual card service shutdown presents a setback, Risevest reassures customers that it’s part of a broader strategy to strengthen their overall product offerings in the digital finance space. The company remains focused on delivering innovative solutions to address the dynamic needs of the market and ensuring long-term customer satisfaction.
