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The point of sale (POS) was recognized when the CBN introduced the agent banking system to enable financial institutions to reach a large number of people, especially those in remote, unbanked and underbanked societies.

The introduction of POS business in Nigeria fosters easy financial transactions since there are long queues and irregular network service and the lack of proximity offered at automated teller machines which have many Nigerians resort to this model of the banking system as an alternative way of receiving money or performing a transaction and the proximity it tends to offer.

The individuals who own this POS business in Nigeria are referred to as third-party banking agents. This simply means they are not direct employees of a bank but they deliver banking services on behalf of the bank for an agreed commission.

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How To Start A POS Business In Nigeria

The process of starting a POS business in Nigeria is easy and can be completed within the shortest time as long as you meet the requirements stipulated. The following are the various steps you need to start up your own POS business in Nigeria:

1. Conduct A Research Study And Have A Business Plan:

Before you embark on this business venture you need to conduct a systematic study and have a detailed analysis of your immediate environment and know the cost required to start up the business. You can do this by conducting survey research on the location, to know the people traffic in the place and the security available in such location.

Also, make an inquiry from different service providers to get more information on what to do and what the business is all about. You could engage in a conversation with other operators who are in this line of business to gather as much information as you can. You can’t start a business without gaining the adequate knowledge required for that business, set it up and keep it running.


2. Have An Existing Business:

This business needs finance to start and sustain it. The Central Bank of Nigeria has given out certain regulations regarding who is eligible for this kind of business. To be eligible, you must have a business in existence which must have been in operation for about 12 months and this business must be a registered business under the CAC (CORPORATE AFFAIRS COMMISSION)

3. Location:

The location of a POS business in Nigeria is an important factor to consider when starting this business because it’s a determinant factor that will decide whether or not you succeed. Ensure it’s situated in a place that has a good number of people who make simple financial transactions regularly, for example, it could be a marketplace, event centre, school environment e.t.c. also note that it must not be close to ATMs or banks so you can enjoy its full benefits. Choosing a good location is also important for security reasons. Ensure you do a background study of the place you plan to set up the business to be sure that it is a safe and well-secured place.

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4. Capital:

Capital is always one of the factors required in starting up a POS business in Nigeria. You need capital to start up this business and the minimum capital most banks require is 50,000. Once this capital is raised, you are getting closer to starting this business. A person could generate funds either from personal savings etc.

5. Get Registered With CAC( Corporate Affairs Commission):

This is one of the requirements to begin a POS business in Nigeria. It must be a registered company or you must have an existing business that is registered either as a limited liability company, Sole Proprietorship or a Partnership business.

6. Have An Active Bank Account:

Since POS business deals with financial transactions, you need an active bank account that has been in use for about twelve months.

7. Approach A Bank:

All Nigerian banks allow this agent banking system. Firstly, you decide which of the banks you want to work with, you approach the bank and get the requirements, fill in the necessary documentation and wait for your approval. The CBN guide made provisions for these banking agents to serve as many banks as they like which makes the options limitless. Once your application is approved, you will receive the POS machine and begin to offer your services to customers.

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8. Set Up Your Point Of Sale:

This is the point where your business is situated, where people can meet with you to render your service and this is obtained after doing your background study of the location. It could be a shop as long as it is situated in a place where people have access to you without restraint.

How To Become Profitable In The POS Business In Nigeria

The two most important criteria make one’s POS business profitable.

1. Location; This is a major determinant factor of how profitable one will be in the POS business. Ensure that wherever you choose your location must have a large convergence and also must not be close to an ATM stand or banks. Your location is one of the main determinants of how profitable you will be in this business.

2. Also gain the trust of the locals by being reliable, trustworthy and competent. People want to do business with people they can trust and agents who can offer the service they require.


Advantages Of Running A POS Business In Nigeria

1. Low capital is needed to start up; POS business in Nigeria unlike some other forms of business requires a little amount to start up. A minimum amount of 50,000 is enough to start it. And it requires a little cost to set it up as a fancy shop is not needed. Most people simply make use of a table, chair, or umbrella and place it at a strategic location.

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2. Access to unlimited customers; The POS agent is not restricted in terms of the number of people and transactions needed. He/She can make unlimited transactions in a day.

3. POS agents could also have other businesses they can engage in during this business. This simply means you could have other work engagements in addition to your POS business. Most Bank agents of the business use this as a subsidiary income as they have other works they are into.

4. Security; Nigerians no longer have to carry out huge sums of money around as the POS has relieved customers of carrying physical cash all the time. Having POS agents in the vicinity in which one is situated, has made it easier for most Nigerians as they no longer go around carrying large cash all day. They could simply deposit or make transfers easily by using these agents. This has ensured the safety of their money.

5. Due to the large convergence of people found in ATMs and banks, POS made it easy for most Nigerians to have access to make financial transactions like withdrawals, transfers etc. As they provide convenience and proximity. POS agents are found in most streets, environments, communities, or societies so people have access to them without restriction. Here in Nigeria, you could find POS agents in each street and environment you find yourself in.

6. POS business has made banks have larger demographic convergence as banks make use of this platform to ensure customers reach and offer their services to customers and ensure customer satisfaction.


Challenges Of Owning A POS Business In Nigeria

1. Security Challenge; This is one of the main challenges that most POS agents face in Nigeria. Insecurity issues ongoing in some areas and environments in Nigeria have prevented most Nigerians from actively engaging and being profitable in the business.

Because this business involves money, these POS agents are open to theft, robbery e.t.c. Some POS agents have left areas or locations that would have been so profitable had they situated their point of location in those areas or locations but due to the insecurity that surrounds those areas, they have to forgo those locations and look for other options around.

2. Network Challenge; POS agents make use of the point of sale terminal device either the traditional or mobile device and this device requires network coverage for its operation. The network has been one challenge that these POS agents face. There are times when trying to carry out a transaction and this network issue will be a limitation for such a transaction will take place.

3. The fast-rising emergence of more POS agents; As more people are fast gaining awareness of how profitable, its feasibility and flexibility, people are now venturing into it. You go to certain areas and environments where you see close to six to seven different POS agents located in a particular area. This has led to competition amongst these POS agents to sort for customers who will patronize them.

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4. Lack of trust; Due to the rise of fraudulent and criminal activities ongoing in Nigeria, Some Nigerians no longer trust POS agents, research conducted showed that the reason why some Nigerians prefer to make use of banks or Automated Teller Machine is since some people popularly known as Yahoo boys make use of the platform to gain access to people bank details and accounts and get away with their money. This has made them sceptical about trusting and making use of these POS agents.


Requirements For Owning A POS

  1. Valid means of identification for example National identification number, voters ID card, Drivers license e.t.c.
  2. Bank Verification Number (BVN)
  3. 2 passport photograph
  4.  current account reference
  5. Tax identification number
  6. Evidence of business registration( CAC certificate)
  7. A minimum capital of 50,000

 Below are some banks you can reach out to for the POS machine you need to start up your business

  1. Guarantee trust bank
  2. UBA
  3. First Bank
  4. Access Bank
  5. Fidelity
  6. Zenith Bank
  7. Kudi POS
  8. Firstmonie
  9. Ecobank  Xpress point,
  10. Baxi Box E.t.c 

 Services Rendered By POS Agents

  1. Cash deposit and withdrawal
  2. Balance inquiry
  3. Bill payments (taxes, utilities, tenement rates, subscriptions etc) these bill payments could be payments like GOTV, DSTV, Startimes, PHCN subscription payments and other utility bills.
  4. Funds transfer services (local money value transfer)
  5. Generation and issuance of a mini statement

Types Of Equipment Needed To Start Up A POS Business In Nigeria

  1. Point of sale terminal: A portable device that enables payment of goods and services at the bank agents’ locations using payment cards and it is usually issued by the banks.
  2. Barcode scanner to scan bills for bills payment
  3. Card reader
  4. Personal identification number

 The POS System

A POS system enables businesses to receive payments from customers, keep track of sales and make a profit.

In the past, Point Of Sale used to be a cash record at a store but it’s different today as contemporary POS systems are digital meaning it could be done with manual record sales all you need is an application with an internet-connected device like your tablets or smartphones and you are set to go. Succeeding in the POS is not different from any other business and it also depends on individual goals. It requires you to give it time.



A POS business is very lucrative and the business opportunity is large and diversified as it includes everyone who has a bank account and needs to make any financial transaction.

POS business usually thrives more in rural areas, basically in areas where there are no banks or few ATMs to serve the people of those communities or areas. One thing people should know is that POS agents are not direct employees of banks they hold sole proprietorship over the business. It’s an additional way of earning aside from your existing business. Just be strategic in your location and know that you are sure to succeed if you get it right.

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