Chocolate Finance sets $250 spending limit on debit card

SINGAPORE – Financial services firm Chocolate Finance imposed a $250 spending cap on its debit card a day after it paused withdrawals following a spike in requests.

The firm told customers on March 11 that it has “temporarily implemented” the transaction limit on its Chocolate Visa card to help manage its “liquidity programme”.

It also said that transactions made on AXS and e-wallet top-ups remained unsupported in order to keep the HeyMax programme “running strong”.

HeyMax is a Singapore-based travel rewards and personal finance platform that allows users to earn what it calls “Max Miles” through spending on credit cards. The points can be redeemed for travel-related rewards or transferred to airline and hotel partner programmes. 

Chocolate Finance founder and chief executive Walter de Oude told The Straits Times on March 11 that the high demand for instant withdrawals from Chocolate Finance was

linked to a miles reward programme

that debit card holders were maximising by making huge payments on AXS machines.

This proved unsustainable and the firm disabled the option to make AXS payments with the Chocolate Visa Card on March 5. 

The Chocolate Finance partnership with HeyMax launched on Feb 11 allowed customers to earn two miles per dollar on virtually everything, even on payments commonly excluded in similar reward programmes, such as charitable donations, insurance premiums, utilities and AXS transactions.

Chocolate Finance told ST on March 13 that it expects the $250 limit cap on its card to be increased soon but it did not commit to a timeframe.

Mr Aaron Wong, founder of travel website MileLion and a user of the Chocolate Visa card, said the $250 spending cap would inconvenience overseas card users.

“Cardholders may have brought their Chocolate Visa Card overseas not just to earn Max Miles, but because the card has no foreign currency transaction fees,” he noted.

“However, they won’t be able to make any payment of more than S$250, unless the shop is willing to break it up into multiple transactions.

“Then there might also be people who have set up the card as the recurring payment method for their insurance premium, which might be more than $250. The transaction will fail, and if they are unaware of the failed payment and don’t rectify it, their policy might lapse.”

Chocolate Finance

suspended instant withdrawals

on March 10, citing high demand, adding that the pause is “not a liquidity issue, but a matter of managing our increased transaction volume”.

It announced on March 12 that customers who have submitted withdrawal requests

can expect to receive their funds

within three to six business days from the time they made the request, in line with normal investment fund redemption cycles.

Chocolate Finance declined to comment on the amount of withdrawals it has processed since March 10.