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How To Start A POS Business In Nigeria

Salary Of POS-Agent Banking Officer In Nigeria

Currently in Nigeria, POS business is one of the businesses you can start with minimum capital. If you are currently unemployed, you can consider this business while you search for your dream job. In this article, we will explain in full detail how you can start a POS business in Nigeria. 

Today, there is a POS store where you can conduct various forms of transactions on nearly every street in Nigeria. Point of sales, or POS, has developed into a popular kind of business in Nigeria. 

What Is POS

POS is an acronym for point of sale. POS is used to describe the location where a customer makes a payment for products or services and where sales taxes may become due. It may be at a physical sales point like a store mostly a kiosk or retail location where card payments are handled by POS terminals and systems with the help of an attendant. it may also be a virtual sales point like a computer or mobile device.

Brief Overview Of POS Business In Nigeria

In 2013, the POS revolution started in Nigeria. This was due to the agent banking system’s introduction by the CBN in that year. The outcome paved the way for all financial services, particularly in Nigeria’s unbanked areas, to reach the general people. The elimination of never-ending bank lines is one significant issue that the POS industry addresses. Another important factor is the proximity of POS establishments, which reduces stress and eliminates the need to travel to the bank for even little transactions. People who live in rural and small towns where banks are far from their houses benefit the most from it.

How A POS Business Works In Nigeria

A POS agent or merchant works with a POS service provider, such as a bank or financial technology firm. When conducting transactions that will result in bank charges, the agent always has cash on hand. The agent in the POS business gives customers a choice of transactions, including withdrawal, transfer, bill payment, and even opening a personal bank account. 

The agent can use the customer’s debit card to pay for all cash transactions thanks to a POS device. On the POS terminal, the agent chooses the transaction type and the amount. The debit card and the customer’s four-digit pin are then sequentially entered. If the transaction is approved, the GPRS network talks to the bank’s computer and prints out receipts for the agent and customer, respectively.

How POS Agents Make Money In Nigeria

POS enterprises have the potential to generate daily returns of up to 20,000 NGN (or even more). But the business’s location is a key consideration in doing this. The cost that POS agents charge for each transaction that a consumer makes, from withdrawals to the purchase of airtime, is how they make their money. The POS service provider will occasionally pay the agents a commission as well.

The agent typically collects a charge fee of 100 NGN when a customer comes in to complete a transaction, such as a withdrawal of 5,000 NGN, from which the POS provider deducts a specific percentage and the remaining amount goes into the agent’s wallet. Every transaction a POS agent completes on behalf of a customer is entitled to a service fee, which the customer must pay. A significant portion of the POS agent’s income comes from the payment of this charge.

As was already mentioned, the agent receives daily or weekly compensation from the bank or POS supplier. This commission varies according to how many transactions an agent has made with their wallet or service.

How To Become A POS Agent In Nigeria

A POS agent is permitted by a financial institution to provide consumers with mobile money services like withdrawals, transfers, and bill payments. You must decide on a POS service provider before signing up as a POS agent. These are widespread in Nigeria. Here are a few of the well-known ones that the article’s latter section emphasizes:

  1. First bank
  2. Wema Bank
  3. Opay mobile bank
  4. Bankly POS
  5. Monie Point POS
  6. Kudi bank
  7. GTbank
  8. Paga
  9. Zenith bank
  10. Access bank
  11. Quickteller
  12. Ecobank
  13. Baxibox
  14. UBA

One must open a bank account with the financial institution they wish to work for or be employed by one they already have an account with to become a POS agent. The latter is preferable because your transactional background may increase your eligibility to be hired as their agent.

Cost Implication Of Starting A POS Business In Nigeria

There is no fixed cost for the start-up costs of POS businesses in Nigeria; instead, the following criteria determine cost:

Location: The amount of money required to rent a store, kiosk, or even an umbrella stand will depend on where you plan to launch your POS business. Find out how much it will cost to set up the location where you plan to run your POS business by asking around.

POS machine/device: POS equipment costs between NGN30,000 and NGN100,000. The bank or Fintech business you intend to engage as your POS service provider will determine the fee.

Available Cash: To be able to carry out everyday transactions, you require a substantial sum of money. It can range, at the very least, from NGN100,000 to NGN300,000. You should be able to meet the daily financial needs of your customers with this amount of money.

Basic Requirements For Starting A POS Business In Nigeria

Start-up capital: As was already mentioned, the POS business does not require a large amount of capital to get off the ground.

Location: The second stage is choosing a location for your firm, somewhere where there is a demand for POS services and where it will succeed. Markets, parks, densely inhabited regions, and others are examples of these locations.

Official requirements: Before any financial institution will accept a POS agent, they must first satisfy the conditions set down by the Central Bank of Nigeria. You can find out more about the requirements by visiting the bank of your choice or by calling their customer service. The CBN allows POS agents to work for different POS service providers, however, the documentation needed for each provider may vary.

Below are some of these documents:

  1. Valid means of identification like National ID Card, Voter’s ID Card, etc.
  2. Passport photographs
  3. Bank Verification Number (BVN)
  4. Current Account references
  5. Evidence of business registration (CAC Certificate)
  6. Start-up funds/ capital minimum of NGN50,000
  7. Tax Identification Number (TIN)

Once the bank approves your application, they will give you a POS machine, free or attached with a cautionary fee, so you can begin your POS business.

Hope you found this piece highly informative?

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