Bitmama, a crypto-fiat exchange that allows traders to buy and sell Bitcoin, Ethereum, Celo and other digital assets, has paused its card services because of unresolved issues with its Mastercard provider, adding to a growing list of fintechs dealing with similar challenges.
In an announcement to its users on Saturday, Bitmama explained that it was a difficult but necessary decision.
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Card balances refunded to Bitmama users’ wallets
The business promised to credit customers’ Bitmama wallets with the full amount of their card balances.
The statement reads, “We would like to update you on an important decision we made to prioritise your experience and security. Due to unforeseen issues with our Mastercard virtual card provider, we decided to pause our partnership with them. This wasn’t an easy choice but we know it was the right one to protect you.”
“Over the past few months, we worked tirelessly with the provider to reconcile all card transactions and balances. Today, we are happy to let you know that every Mastercard balance has been liquidated and refunded to your wallet on Bitmama,” it adds.
Bitmama assured customers of their safety
The company emphasised its commitment to prioritising customer safety and maintaining a positive user experience.
“This wasn’t an easy choice, but it was the right one to ensure your safety and maintain the trust you’ve placed in us.”
“Thank you for sticking with us—we’re here to make your crypto experience as seamless and secure as possible!” it assured.
Other fintech companies facing similar issues
Other fintech companies such as Rise and Carbon, have taken similar steps in response to exchange rate instability and provider issues, having previously suspended their card services.
According to Adedeji Olowe, CEO of Lendsqr, these suspensions are also being caused by high expenses and little opportunity for revenue.
A significant virtual card provider, Union54, also suspended operations in 2022 as a result of an increase in chargeback fraud, while startups like Chipper Cash have faced declined transactions due to insufficient funds, which has resulted in a ₦500 fee for such cases.
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Hurdles for Bitmama to cross
This pause in card services puts Bitmama at at a competitive disadvantage, especially considering its focus on promoting cryptocurrency usage outside of trading.
To maintain client loyalty in the face of these service interruptions, the business might need to innovate its offerings.
“Your trust means everything to us and we will always go the extra mile to ensure your funds are safe and your experience with us is smooth,” Bitmama reassured.