Prospa Faces Withdrawal Issues Again, Halting Transactions for the Second Time in Five Months

Prospa, the Y Combinator-backed business banking startup, is once again under scrutiny as it faces persistent complaints and social media backlash due to significant delays in processing customer withdrawals. This marks the second time in five months that Prospa has encountered such issues, raising concerns among its user base about the reliability of its services.

Four customers have reported that their withdrawals have remained unprocessed since May 2024. The company has cited service downtime as the reason for these delays, mirroring a similar situation in February 2024 when customers experienced slow transaction speeds and had to wait weeks to access their funds. Despite these recurring problems, Prospa has not immediately responded to requests for comments.

Business owners who rely on Prospa for various services, including deposits, company registration, virtual storefronts, invoicing, bookkeeping, sub-accounts, and working loans, are increasingly concerned about these delays. One business owner, who had ₦800,000 in his Prospa account, shared his frustrations with TechCabal in March, stating, “Either their [customer care] phone lines were switched off or they responded saying they have NIP server issues. I called my friend who works at NIBSS [the country’s payment aggregator], and they said Prospa had no such issues.”

In mid-March, the delays were reportedly resolved, with some customers visiting Prospa’s Yaba office and others forming virtual support groups to share updates. However, the relief was short-lived. By May, customers began experiencing delays again, with some withdrawals taking up to three weeks to process. An affected user lamented to TechCabal, “At this point, the customer care reps are just engaging complaints because they have to, and not to actually help.”

Many frustrated customers have been visiting Prospa’s office in person to demand resolutions. An employee at Prospa mentioned that account managers attend to these customers and resolve their complaints when they visit the office.

A former employee of Prospa dismissed comparisons to Brass, another business banking startup that faced working capital challenges before being acquired by new investors. “Prospa has never experienced capital issues. Their problems were solely technical,” the former employee, who worked in Credit, explained to TechCabal. “They are partnering with commercial banks, so most times, the engineering team says the issues stem from those banks.”

Prospa has previously partnered with Wema Bank and Parkway Ready Cash. According to its website, it currently partners with Good News Microfinance Bank. These partnerships are crucial to Prospa’s operations, but they also appear to be a source of the technical problems that have plagued the startup.

As Prospa navigates these ongoing challenges, its ability to address and resolve technical issues promptly will be crucial to maintaining customer trust and confidence. The recurring delays highlight the importance of robust technical infrastructure and effective customer support in the competitive business banking sector.

For now, business owners and customers are left hoping for a more permanent solution to the issues that have disrupted their financial activities and trust in the startup.