How to start POS business in Nigeria – Are you unemployed at the moment and looking to get your hands on something to keep body and soul, do you have a regular job but looking for a side hustle to complement your 8-5 routine?
Are you a student looking to help yourself and be less dependent on your parents who have a lot of responsibilities on them, are you looking for a business you can run full time and make a huge profit with less stress, risk, etc?
If your answer is a yes to any of the above or you are looking to better your life in any way but not being captured in the questions above, this guide is strictly designed for you.
Note: I will advise you to leave whatever you are doing at this time, better still save this web page to come and read later.
I do not doubt that your prayers for a financial breakthrough said many years ago are about to be answered in a single blog post.
Take it seriously and read it as if this is your last chance to survive Nigeria’s biting economy.
Let’s dig in on a journey for the discovery
About POS business in Nigeria
I’d want to believe that at some point in today’s Nigeria you’ve had the privilege of using a POS terminal to either receive or send money to friends and family.
Necessity they say is the mother of invention, in the past, we rely solely on financial institutions/Deposit Money Banks to carry out every money transaction, given this, the financial sector saw a need to make accessing financial services easier and seamless.
For instance, people in rural areas do not have access to banks, they hardly participate in financial transactions through the banks.
Over the years, the absence of financial services for the rural poor contributed to a myriad of poverty in Africa’s most populous nation as well as other African countries.
The need to further take financial services and make them available to the common man on the street as well as in rural localities gave birth to Financial inclusion, agent banking as well as the POS business we are talking about.
Who is behind the POS business in Nigeria?
This is critical, given the need for financial inclusion, the Central Bank of Nigeria took a step to distort the financial services market where the banks and Fintech companies are licensed as major players/operators.
Against the usual practice, agent banking made way for Fintech companies to penetrate the market independently and render financial services.
By this saying, it means that the POS business is being supported by the banks as well as the Fintech companies whose major aim is to distort the aged-long banking process established in Nigeria.
What is POS?
The acronym “POS” stands for “Point of Sales” usually a machine technology called the “POS machine” controls the heartbeat of the business through which all transactions are consummated while rendering financial services to teaming Nigerians in this case.
How POS business works
If you are interested, to join this business you will have to either work as a bank agent or a Fintech agent. By this notion, you are not working for anybody, get that straight, you are a boss of yours.
The bank/Fintech company will have to register you electronically on their agent list, thereafter you will be apportioned a POS machine through which you can render services.
You are paid commission on transfers, withdrawals, etc., strictly on the issuer’s predetermined arrangement.
As an agent, you charge certain amounts for transfers, withdrawals, and other services as deemed suitable, there’s no blanket charge, and you decide what you collect as a charge.
The bank/Fintech most times deposits your backend commission into your bank account by the end of the month.
How much you can make from POS business is dependent on your transaction count and frequency, in this regard you should cite your business in a densely populated financial service targeted area.
Services rendered by a POS merchant
You can offer the following services
- Open bank account
- Deposit and withdraw for customers
- Fund transfer
- Bill payments like electricity, Cable TV, airtime top-up, payment of tax, etc.
What you should consider in the choice of issuer/Bank/Fintech
Here are bonus tips you should consider before applying to get a POS machine from either a bank or a Fintech company.
The truth about this business is that all banks and Fintechs POS machines are not created equal, while the machines may seem to respond to similar commands and services, however, there are up and downsides to each bank/fintech company you must factor in.
Your ability to get up to speed in no time largely depends on who is your issuer.
- Consider the uptime for a particular bank/Fintech company – Some issuers would always face a network downtime, consequently, if you are using such a machine there’s no how it wouldn’t affect your output in terms of revenue. Network downtime here refers to situations where you cannot process a transaction because of network issues.
- Some issuers may not have a fair enough package – when it comes to your commission/remuneration backend, you’d sure prefer who has a fair deal.
- Some issuers debit the customers after transactions – if you charge N500 for a withdrawal of N50k, and the bank/Fintech goes ahead to charge the customer may be extra N300, such customer will NEVER return to your spot, hope you get the idea.
- Some issuers grant agent loans – This appears to be one of the most interesting aspects of this business, you could have access to loans for the smooth operations of your business, and every business requires additional funding, make do with a company that’ll grant you a such advantage.
- Cash back – Cashback is a token given to a merchant for consummating transactions as compensation, if a company has cash back for the agent, it’s a good deal too.
I would advise you to shop around and compare these factors, however, stick around as I will reveal a list of companies that’ll aid your success in this guide at the lace of a shoestring.
How can I make money in this business?
The income potential in the POS business is amazing and mind-blowing if and only if you get started following my recommendations in this guide.
You will make money by charging customers for withdrawals and deposits respectively. The bank/Fintech in turn pays you certain commissions on each transaction treated, exactly why you should drive transaction count and volume.
How much do I need to start up a POS business in Nigeria?
There’s no specific amount required to get started, however, you may commence with as little as N100,000 this money is strictly for your turn-up.
As you advance, you may need more money to be able to service your customers, the more money you have the merrier in this business.
Requirements to start a viable POS business
All you need to get started is a functional and reliable POS machine issued by a company with relative uptime.
You will need a good location with human traffic as well as targeted for financial services demands. A marketplace is usually top-notch, where traders need cash as well as to send money to friends, associates, and family.
A plastic table, a seat with an umbrella to wage against sun and rain in most cases. You will need some money deposited in your merchant account as well as some cash as liquidity for the business. No amount is too small neither is any amount too big for this business.
How to start POS business in Nigeria
To get started you will need to visit a preferred issuer/bank/fintech in this case, complete the necessary documentation, you’ll be profiled for a merchant/agent account.
POS will be issued as soon as it’s ready for you to get started at once.
However, kindly be informed that most issuers would require that you have a viable location, and meet certain requirements.
The Fintechs are always ready to break the deal and get you up to speed as soon as possible, you may be required to pay for some POS machines while others are issued free of charge.
How much you can make from POS business monthly
There’s no limit to how much you can make in this business every month, you can make way above N500k depending on your effort and location.
Income potential and analysis
Assuming you were able to complete 100 transactions per day.
Where you charge N200 for every withdrawal above N10k, and N100 for every withdrawal below N10k for at least a basic minimum
200 x 50 equal to N10,000
100 x 50 equal to N5,000
N10k + N5k equal to N15k.
It stands that for base minimum charges per transaction as captured above, you will make N15k per day having treated 100 transactions, it could be higher depending on how much a customer is looking to withdraw or pay.
It then stands that with an average of 100 transactions per day you are making N15k daily.
N15k x 30 days equal N450k per month.
It stands that with an average of 100 transactions per day you will have a transaction count of 3,000 per month.
The bank or Fintech will pay not less than N100k commission on average for a 3,000 transaction count per month on average basic.
N450k + N100k equal N550k on average per month.
Now you see that you can make way above N250k naira per month running POS services.
These figures are real and achievable, guys are making a kill far above N550k monthly running a POS business in Nigeria.
List of best POS machines for this business
I promised to reveal a handful of companies banks and Fintech companies whose POS machines and configurations are ideal for your success in this business, kindly find the below list in no particular order.
- Kudi POS
- Firstmonie by the First bank of Nigeria
- Access Bank CLOSA
- Quickteller Paypoint
- Ecobank Xpress point
- Union bank
- Zenith bank
Can I start the POS business with N100k?
N100k is enough to start the business, however, the more money you have the better so you can attend to your customers with maximum liquidity.
How to start POS business in Nigeria with GTBank?
To use the GTBank POS, you must have the following;
- GTBank account
- Valid ID card
- You must have an existing business location
- You must have proof of address.
How to get GTBank POS
- Open a GTBank business current account
- Visit the bank and request a POS application form
- Having approved your request on basic qualification, you will be notified to collect your POS when ready.
How to start POS business in Nigeria with OPay?
If you are an Opay user and looking to become an agent, you will need to upgrade your KYC level from KYC1 to KYC2, you need to provide your BVN, gender, date of birth, and state of residence to upgrade your KYC.
You will need the following documents
to get OPay POS
- Your BVN
- Utility bill not later than three months
- Copy of your ID card
- 1 passport photograph
How to get an OPay POS machine?
- Open your OPay app and go to Me
- Click on the picture icon at the top left corner to get to your account details
- Click upgrade to level 3
- Upload your picture
- Upload a valid ID card
- Upload a recent utility bill not later than 90 days
- Upload your BVN
- OPay has a team that’ll review and approve your KYC upgrade within 24 hours of such submission, SME and email notification will be sent to you.
The next step here is to apply for a POS
- Login to the OPay app on your device
- Click on the “Merchant Apply” icon
- Enter all the necessary information as requested
- Upload your transaction history for the past 90 days
- Upload a valid ID
- Take a snapshot of your business location and upload it to the portal using the advised column
- Submit for further review, your application will be reviewed and if approved, you will receive a POS machine within 24-72 hours of this application.
There you have it on how to start POS business in Nigeria, essentially, there’s no limit to how much you can make, don’t let anyone deceive you that the market is saturated that’s a fat lie. Opportunities abound and are waiting to be tapped.
Good luck in advance.