So, the past few days have been fun for Chocolate Finance.
After a surge in withdrawal requests over the weekend, the bank not-a-bank was forced to temporarily suspend its instant withdrawal feature, which normally allows customers to withdraw up to S$20,000 per day immediately. As you can imagine, this didn’t go down well, and Chocolate’s slow and uncoordinated response turned what could have been an unpleasant but contained incident into a full-blown crisis for the brand.
In the coming days and weeks, there will no doubt be a wave of post-mortems and inquiries, hand-wringing and recriminations (an excellent piece from a compliance professional’s perspective has already surfaced on Medium). For the moment, however, Chocolate has announced some new restrictions on the Chocolate Visa Debit Card as it tries to get back on its feet.
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| 💬 Update from Chocolate Finance |
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“Along with the pause in instant liquidity, we have temporarily implemented a S$250 per transaction spend limit on your card to help us manage the liquidity programme mentioned above. We’ve also made slight adjustments to where you can use your card — specifically, transactions made on AXS and e-wallet top-ups are no longer supported. This helps us keep the HeyMax programme running strong, meaning more miles for all of you, for longer!” -Chocolate Finance |
Chocolate Visa Card imposes S$250 transaction limit
| ⚠️ Story update (14 March 2025): Chocolate Finance has increased the transaction limit to S$1,000. |
During the chaos of the “Black Monday” incident, Chocolate took the drastic step of suspending all transactions on the Chocolate Visa Card, presumably to minimise further outflows.
Chocolate has now begun to gradually resume transactions, but with a spend limit of S$250 per transaction. Any transaction above this limit will automatically fail, regardless of the funds you have in your account.
However, there are still reports within the community that transactions within this limit are failing, which might suggest that Chocolate has expanded its transaction blacklist (see next section), and/or re-enabling transaction functionality in batches.
This gives Chocolate the somewhat dubious distinction of being the first debit card where the spending limit is determined not by the funds you have, but rather the funds the bank not-a-bank allows you to spend!
It’s unclear when exactly the limit will be lifted, but in the interim, those who have the Chocolate Visa set up as a recurring payment method for bills should take note. The last thing you want is your insurance policy lapsing, or incurring other kinds of late charges because your transaction of >S$250 didn’t go through.
New restriction on e-wallet top-ups
In addition to the transaction limit, Chocolate Finance has also disabled support for e-wallet top-ups. While the email doesn’t specify which ones precisely, a Chocolate representative has informed me that all transactions under MCC 6540 are blocked.
Now, e-wallet top-ups never earned Max Miles in the first place, so there would normally be no reason to use the Chocolate Visa Card anyway. However, when instant withdrawals were paused, customers started using e-wallet top-ups to cash out their funds, in particular GrabPay (top-up GrabPay > cash out balance to bank account).
If you want to further reduce your Chocolate balance, but don’t have actual transactions to make at the moment, one option would be to buy gift cards from portals like Wogi or HeyMax and spend them later. Alternatively, you could buy NTUC FairPrice or Cold Storage vouchers, or make prepayments on your SP Utilities bill (though this requires visiting the customer service centre in Toa Payoh, since you can’t overpay via the app).
What now for the Chocolate Visa Card?
While Chocolate’s handling of this matter has pretty much been a case study in how not to do crisis communications, I don’t for a moment think that there’s anything untoward going on.
Part of the problem was that the surge in withdrawals started on the weekend, when markets were closed. Now that the work week is underway, Chocolate can process the redemptions and begin returning money to customers, at which point much of the panic will start to die down.
But make no mistake— the past couple of days have been deeply damaging to Chocolate’s reputation. Trust has been lost, and even if customers haven’t sworn off Chocolate completely, it’s likely that many will start using it as a conduit, rather than a store of value (i.e. transferring the exact amount needed for a transaction into Chocolate before spending it immediately).
On a separate note, I suppose I shouldn’t be surprised, but it was somewhat disheartening to see the almost gleeful manner in which some corners of the internet reacted. It was a field day for FUD, with some people relishing the chance to tell worried users that their money was gone forever.
I mean, I get that there’s a lot of anger towards Chocolate over the way they handled the AXS nerf. Believe me, I feel it too. It was bad enough not giving any notice, but attempting to pin the blame on AXS was, in legal parlance, “a dick move”. I find it particularly disingenuous that when a Chocolate representative sent a message about the AXS nerf, the actual wording was “we have just been informed AXS is no longer accepting Chocolate card payments”, as if they had no part to play in it.
Still, I took little joy in seeing the events of the past few days unfold, especially with the knowledge that there were plenty of ordinary folks caught up in the mayhem, people who lost sleep sincerely believing that they’d fallen victim to the next Hodlnaut. For them to have to see others cheering the carnage in an almost vindictive manner, wishing Chocolate to collapse— what does that achieve, exactly?
Anyway, the future of the Chocolate Visa, at least as a miles earning tool, is very much up in the air. If you’re holding out hope for AXS to make a return, don’t. The Chocolate CEO’s interview with CNA basically said it was a mistake to allow that in the first place. At best, we can hope that the lack of exclusions will continue for other categories like charitable donations, government services, insurance premiums and utilities, though in the absence of AXS, the ability to earn miles depends on whether direct Visa payments are accepted.
Conclusion
Chocolate Finance has imposed new transaction limits on the Chocolate Visa Debit Card, which restrict cardholders to no more than S$250 per transaction. If you’re not able to split your payment into several transactions, then you’ll need to find another card in the interim.
E-wallet top-ups have also been blocked, so customers who wish to withdraw their funds will need to submit a request and wait 3-10 business days.
It’s going to be a long road back for Chocolate now, even when transaction limits are lifted. I can’t help but think that some timely communication would have made things very different.
The thing I totally can’t accept is that the CEO said we are gaming the system…I am just simply using the axs function you promoted in the commercial. This is an integrity issue of the CEO and the company. You can nerf whatever you advertised, but you can’t call consumers “gaming.” We are not.
How dare you question your colonial masters?!!!
1. The CEO is South African
2. Why bring race/nationality into this. If the CEO was Chinese Singaporean i bet you won’t make it an issue.
If he was we would call him a chao sinkie sme boss lor. Why cannot bring? We are all just here kpkbing after all.
Why you drop the race ahh. Not chao sinkie, its chao Chinese sinkie
The name De Oude has colonial master origins anyway smartypants.
Your comment tells me your life is one of perpetual failure.
pathetic loser
ride them harder!
But did you?
Walter is not known to be someone who does things only after lots of meticulous scenario planning. Remember the time when SingLife was running a promotion where there was an incredible deposit interest rate on their SingLife Visa debit card (also covered in a Milelion article from years back)? That was his idea. How did they offer that rate? They offered it at a loss to SingLife (a sizeable pot of cash was set aside for this exercise) in the hope that it would earn SingLife market share and cement its position as a major player in the market. Walter… Read more »
I like how chocolate shifted the blame to everyone else – users game the system, axs not accepting their cards. All excuses for a campaign they thought would work but backfired
You’ve said exactly what I wanted to
I think this is the root cause of chocolate finance issue, to sum it up in a word? Trust
They could have been frank to admit and nerf AXS functionality. Sure users would be pissed, but at least there is transparency
Their reason for not informing beforehand was that people will use it even more before the deadline. Full of shit excuses
I have applied to withdraw 99% of my funds yesterday. Hopefully will see my $$$$$$. No faith to use it as an interest generating tool. Only as a conduit as mentioned above and not in the near future too.
I have withdrawn everything from this roti-prata finger pointing company. It gave me no confident and, in my opinion, a very low integrity org.
Putting my money elsewhere.
[in legal parlance, “a dick move”]. Writing like that is what keeps me coming back to this site daily. Thank you for making me smile this morning.
I think it’s extremely irresponsible for the CEO to just push the blame on everyone but themselves. While the CEO mentioned about a mistake to learn on communication blah blah, they still dragged everyone down to the water. Not great leadership.
If in a rush to get funds out, can use revolut > transfer to bank account, so long ok to incur a 0.3% fee. Thats what I did – to reduce the uncertainty of funds in limbo
Laosai so hard!!!
The whole thing from the start had too many good advertised positives on a weak base that should have raised red flags. No financial institution without a social mission can take a hit like that much less a start-up. I’m glad I didn’t buy in. Was going to wait a few months like I did with Yuu (all in there now but it’s DBS/Temasek) and glad I waited before wading in. At least Amaze was more sensible in their roll-out and exclusions and the Citibank Apple promotion was Citibank (and even they had to stop).
I still cannot understand what is referred to as the huge surge in transactions in particular via AXS. Afterall, the maximum worth spending is $1,000 per MONTH, or the miles drops to a very low number (0,4). So where was all that transaction volume coming from? It was not as if card holders would have been spending thousands and thousands via AXS. The maximum per month that made any sense was only $1000. Indeed, there are a lot of things about this whole saga that reek of excuses and an attempt to hide the real facts and truth.
even with 0.4 mpd, some people could have make use of that to game the system and generate more miles using the card to pay some insurnace or investments via axs that you can easily encash back
Nevermind
Offering high deposit rate with instant withdrawal and subsequently default its promise after taking in depositors’ $$ is considered as a credit default – no other way to put it.
It’s like a bank run, only it’s not a bank, no SDIC. If they have to liquidate assets to satisfy withdrawals, the timing of the liquidation could result in losses depending on rate movements. So logic suggests that the possibility of a net negative return is possible no matter what is said about how they structured the accounts.
Hope there is no critical problem with Singlife, another company he owned.
The other company I would be very careful of also starting with Sing and and if you are a saver…………..
He already left Singlife.
There is warning on the withdrawal page that states “The final amount you receive may differ from the amount withdrawn due to market movements.” Chocolate Finance clarified that “Do note that Chocolate Finance is an investment account. When selling your investment, the final amount you receive may differ from the amount withdrawn due to market movements. The amount will depend on the unit price of each fund at settlement and can eb higher or lower than the requested amount”. Maybe this is embedded in the T&Cs but I had assumed that Chocolate Finance guarantees “principal amount”, i.e. if my account… Read more »
Do you still trust what these jokers are saying? This entire saga is ridiculous- they shouldnt even be running a hawker stall much less a financial institution.
they should have rolled it out as a limited miles promo. eg. like what HeyMax did for their own transport miles promo limiting to 1m miles. this way they know their max liabilit (cost) and everyone is aware is fast fingers first
Glad I never signed up after all, in this world no one gets a free lunch. Those free and enticing miles at the start are now showing their costs. Good luck to everyone in getting their funds back
I have been blocked by Chocolate when I withdrew my interest every day. It is not a trustworthy company, even though we follow its rules.
Good Stuff, Shifted the 30k i deposited already. Will only top up when using the card.
Making so many changes without any prior notices is a huge fail on their end. Zero credibility.
Apart from transport (Bus + MRT), insurance bills that allow you to pay via credit cards, and maybe school fees (but they’ve nerfed it till max $1,000 per transaction, I hope they open it back up before the new academic year), what are our options if we want to gain Max Miles? I have about 2000 Max Miles from last month by maxing out the card before the whole debacle happened. Should I cut my losses with Max Miles and concentrate solely on KrisFlyer Miles instead?