4 Simple Steps to Start a POS Business in Nigeria; How Lucrative? Cost of POS Machine, How Much Can I make Monthly

POS Business is one of the most profitable businesses in Nigeria. It is also one of the many benefits of the advent of technology in the banking world.

This business thrives in areas where access to banks and ATM’s is a big challenge. It offers quick financial services to those in need of it – like cash withdrawals, cash deposits, payment of a variety of bills (electricity, cable TV, and taxes), balance inquiry, and funds transfer.

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The POS business in Nigeria has come to stay as it will continue to serve remote areas and even urban areas where human traffic in ATM’s and banks is getting worrisome.

The general idea behind its creation is to make financial transactions easy, quick, reliable, and available for everyone regardless of geographical barriers.

Starting a POS business in Nigeria is quite easy with the right information and guidance which this article will provide.

Let’s begin with the meaning of POS.

What is POS?

POS is an acronym for Point of Sale or service. It is a banking retail service that allows you to carry out financial transactions away from the indoors of a bank using your debit card and a POS machine. It covers a broad range of financial services offered in a banking hall like payment of utility bills, taxes, cash withdrawals, and deposits.

Beyond these, with the aid of a POS machine and of course, your debit card, you can make bank transfers and also perform cashless transactions – like using your debit card to make payments in boutiques, malls, hotels, eateries, and virtually any business with a functional POS machine.

Benefits of POS Business in Nigeria

Whether you decide to start a POS business or just sit back and leverage on its existence, it’s a business that is beneficial to everyone.

The benefits include:

  • Quick and reliable access to cash on emergencies
  • Ease of the stress involved in ATM queues and banking halls
  • Creation of job opportunities
  • Mitigating the risk of moving about with a large chunk of cash
  • Easy payment of bills
  • Reaching the unreached in terms of financial services
  • Complementing the growth of financial institutions

How Profitable is a POS Business in Nigeria?

Since its inception in 2013, POS business in Nigeria has risen to become one of the most profitable medium scale businesses in the country. If you consider a given demographic where access to banking services is rare, you could be making up to N5, 000 daily in profit. You can do the math and multiply that figure by 30 days.

However, this could be less (around N2, 000 – N3, 000 daily) if you are running this business in an urban or suburban area where people still have options when it comes to banking services. When there are no available options to withdraw or deposit cash or the options are costly, people will have no choice but to patronize you and that’s profit.

How Much Does It Cost to Start a POS Business in Nigeria?

If you are looking to start a POS business in Nigeria, then you should be looking at having a minimum capital of N60, 000. This is because the cost of a POS machine in Nigeria can vary depending on its specifications (we have 2G, 3G, and 4G machines). Some can be as low as N45, 000 while some can go as high as N100,000 or even N200,000.  If you are wondering where to get POS machines, we have that covered in the preceding subheadings. Just keep reading.

See Other: 20 Business Ideas you can Comfortably Start with N100,000 in Nigeria

How to Start a POS Business in Nigeria

4 Simple Steps to Start a POS Business in Nigeria; How Lucrative? Cost of POS Machine, How Much Can I make Monthly

The POS business which is also known as agent banking business requires that you become a POS agent of a bank (FirstBank the most popular) or a reputable financial service provider like Paga and Quickteller before you can start. Whichever media you choose; a bank has to be involved.

We’ll delve into how you can achieve that shortly, but you should be aware of one integral factor before starting. It’s the location factor.

As stated earlier, this business thrives better in remote areas where banks and ATM’s are rare. Observe the use of words here – thrives better, it doesn’t mean it’ll fail in the city, it only means you’ll have more customers in remote villages or generally, areas where ATMs and banks are scarce.

Now that you have stapled that in mind, let’s proceed.

First things first.

1. Have a Business Already

One of the mandatory requirements for starting a POS business in Nigeria is that you must have an existing business. Its a requirement imposed by the Central Bank of Nigeria on any potential POS business owner. But that’s not all.

Your business must have been in existence for at least 12 months before starting the POS business and should have an office location. Let that not scare you, it simply means, you should have a shop.

Furthermore, the business should be registered with the Corporate Affairs Commission (CAC) as either a sole proprietorship business or a public entity.  

See: New Steps to Register and Incorporate Your Business in Nigeria to PLC or LTD

2. Apply Through a Bank

Fortunately, a lot of banks in Nigeria permit agency services as a means of expanding their reach to make more profit. As a business owner already, you should have an account with any of the Nigerian banks but you can decide to use any bank of your choice.

Simply approach your preferred bank and let your intentions known. You’ll be given certain terms and conditions that are consistent with that of the Central Bank of Nigeria (CBN) as regards the business you are about to start.

You should have met 90% of these conditions if you have a registered business, but basically, the conditions or general requirements include;

  • Proof of business registration
  • BVN
  • Credit Bureau Report
  • Tax Identification Number
  • 2 Current account references
  • Any recognized means of identification; National ID card, International passport, or voter’s ID

You can then proceed to fill some forms and sign an agreement with the bank if you have the aforementioned. You should note that if you are not using your bank, you’ll be required to open an account with the bank you choose for the POS business.

3. Receive the POS Machine

Once all the paperwork with the bank is complete, the bank then issues the POS machine to you at a price. We are not certain if you can purchase this machine in the market, but for now, the bank is the only place that can hand you one.

You can receive your POS machine within 7 to 14 days. Some banks like First and Zenith banks can offer you the machine for free depending on certain terms and conditions.

The POS machine is not the only device you’ll be equipped with to get started. You’ll also be issued a mobile phone, a card reader, a barcode scanner, and a PIN which you will use each time you make a transaction for a customer.

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4. Start Offering Financial Services

Armed with the POS machine and with every other gadget or tool issued to you by the bank, you can start offering financial services to those in need.

The services you can offer include;

  • Cash withdrawals and deposits
  • Payment of bills (electricity, water, rent, cable TV subscriptions, taxes, etc.)
  • Local funds transfer
  • Balance inquiry and statement printing

Don’t worry about how you can carry out all these operations as the bank will guide you on how to do them.

2 Ways to Make Money from POS Business in Nigeria

1. Service Charges – For each transaction, you can charge any amount between N100 to N500 depending on the amount the customer is withdrawing or depositing. You can also charge for the payment of bills and other transactions.

2. Commission – The bank you registered with pays you a certain commission which is dependent on the volume of transactions done with your POS machine as their agent. It gets even more profitable because you can register with as many banks as possible. You can be a banking agent for 3 to 5 banks if you want and make money off them all.

How Much Can I Make Monthly

Generally, most POS business agents report that they make between N150,000 to N250,000 as profit every month. Like I said earlier, the profit you will make will depend on your business area. The farther from the bank/ATM point, the higher chances that people will patronize you.


Starting a POS business in Nigeria is one of the many ways you can provide an alternate source of income for yourself. It is profitable and easy to start. But one thing is paramount – your capital and choice of location. Capital because you can’t start without it, and location because beyond starting, you need the business to thrive and make a profit. It’s advisable to venture into the POS business if you have an existing business that is registered. It’s a business that has come to stay due to the flexibility and access to instant funds it offers especially for people in remote areas. You can leverage on this single factor and never run out of cash anymore.

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Obedience Ekwe

Obedience Ekwe is a freelance article writer with over 6 years of experience writing for various niches. InfoGuide Nigeria team comprises Resource Persons and Consultants led by Ifiokobong Ibanga. Page maintained by Ifiokobong Ibanga. If you need a personal assistance on this topic, kindly contact us.

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