How To Start A POS Business In Nigeria

he Point of Sales (POS) business began to spread in Nigeria in 2013 after the Central Bank of Nigeria (CBN) introduced the agent banking system in 2013.

This opened up a new portal for financial services to reach bank customers in remote, unbanked, and underbanked societies. This means that POS businesses serve as a way to extend the services offered by financial institutions to relatively unreached parts of society.

However, this is not the only problem solved by the agent banking services. Despite the push for a cashless economy in the world, Nigeria and other developing countries like it are still predominantly cash-based.

The long queues and irregular network services at Automated Teller Machines (ATMs) encourage many customers to find alternative ways of receiving money or performing transactions.

Asides from this, it also helps consumers withdraw money with ease when the nearest ATMs are far away. In other words, POS businesses make it easy for consumers to get the money they need in exchange for a commission.

Many individuals often express skepticism on the profitability of such a business. However, the market for this business is large and diverse – including anyone who has a bank account and needs to perform any transactions. It is indeed a lucrative business.

Although they are a retail channel provided by banks, POS agents are not direct employees of banks and so hold autonomy over their businesses.

How Does The POS Business Work?

A POS agent operates under a POS service provider, like a bank or a financial technology company. The agent keeps cash at hand for transactions, which will incur a bank charge fee.

In the POS business, the agent offers customers a variety of transactions to choose from, such as withdrawal, transfer, bill payment, or even opening a personal bank account.

A POS device makes it possible for the agent to carry out all cash transactions with the customer’s debit card.

The agent selects the transaction type on the POS terminal and the amount. Then the debit card is inputted and the customer’s four-digit pin consecutively.

The GPRS network connects to the bank’s server to approve the transaction, which, if successful, brings out receipts for the agent and customer, respectively.

How to Become a POS Agent

The process of starting a POS business is easy and can be completed within 2 weeks to a month, provided you meet the requirements by the host bank.

1. Raise Capital:

As earlier mentioned, the capital required for the business is low. You also do not have to worry about extravagant furniture fittings for your shop.

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A humble store with a clear sign advertising your services works well. Get a business loan from WEMA Bank.

2. Get a Good Location:

Densely populated areas work great for a business such as this. Look for crowded areas with pedestrian traffic such as markets, motor parks, residential areas and so on.

3. Fulfil The Official Requirements:

Financial services are a sensitive area of life to deal with and this is why the Central Bank of Nigeria has taken several precautions to ensure the integrity of those who will qualify to be agents.

One of such requirements is that you must have an existing business of any type (in operation for at least 12 months) and have a shop or office from which you operate.

4  Approach A Bank And Apply For The POS Machine:

Decide on the bank of your choice and approach them to get the details of their requirement. By applying to become a POS agent, you can either get the POS machine leased, bought, or even for free.

The official CBN guide allows you to be an agent for as many banks as you desire. Fill in the necessary documentation and wait for your application to be approved. Some documentation you may need include:

5. Valid means of identification such as a Driver’s license, National ID Card, Voter’s ID Card, etc.

6. Passport photographs

7. Bank Verification Number (BVN)

8. Current Account references

9. Evidence of business registration ( CAC Certificate )

10. A minimum capital of ₦50,000

Once your application is approved, you will receive the POS machine and you may begin offering your services to customers.

Top 5 Advantages of POS Systems

Below are some advantages of POS (Point Of Sale) systems;

Better Customer Service

Giving your customers a great experience leads to greater customer satisfaction, which keeps them coming back. Choosing a great POS system helps to move along a sales transaction faster and more efficiently.

POS systems can also be used to offer relevant products to customers, creating more sales opportunities and a tailored experience for your customers.

Easier Team Management

Some POS systems allow you to track employee-related data, such as sales per employee and number of hours worked. This gives you a greater view of your business’s team and helps you plan more efficiently.

Using such a POS system helps you understand what and who is working best, meaning you can plan better for the future and provide training and assistance where necessary.

Saved Time

Using a POS system helps to save time, as POS systems are packed with features that reduce the amount of time you need to spend on admin or mundane tasks.

POS systems can help you manage inventory, orders, customer service, purchasing, reports, and more. A POS system can, for example, provide up to date reports on inventory so you can easily stay on top of stock.

Multi-Store Systems

If you have more than one store, it can become difficult to service each one in the same way. With a POS system, you can flawlessly manage multiple stores. This means that every store can provide the same level of service, efficiency, and ease.

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Each location will have their own inventory, with a POS system you can easily manage inventory and stock levels across multiple locations at the same time.

You can use data from all locations to figure out trending patterns, track sales, and plan ordering.

Increased Sales

As well as improving customer and employee experience, a POS system can help increase your sales. Some POS systems offer actionable insights into your sales patterns so you can see where change is needed, and track improvements.

Plus, cloud-based software will continually provide you with the latest tech, allowing you to take new payment methods such as contactless and online payments, opening up more revenue streams for your business.

Disadvantages Of Owning A POS Business

As they say, everything that has an advantage has a disadvantage. Hence, you must contemplate the cons of a POS business before you decide to start one.


The management of POS businesses requires transporting large amounts of money from the bank to your place of business.

POS agents and their business places can be a target for robbery attacks from criminals. It is important to be security-conscious and alert at all times.


Some unsavoury characters patronise POS businesses to carry out fraudulent transactions. You might need a few tips from others who have been in the business to spot a scam when you meet one.

Bank networks:

It’s never a pleasure being a victim of a bad network when performing a transaction, asides from delaying the customer, it also causes unwarranted debits from banks even if the money never got to the agent’s wallet.

Because of this common problem, most POS agents use different POS machines. It is also necessary to do proper research to know which POS service provider has a reliable network.

Unstable electricity:

POS machines need to be charged. This might prove difficult because of the unpredictable nature of electricity in Nigeria. So, as a POS agent, you might need to have another source of power, like a small generator, for backup.

How to Become a POS Agent

A financial institution approves a POS agent to perform mobile money services like withdrawals, transfers, and bill payments to customers.

Before becoming a POS agent, you must choose a POS service company. There are many of these in Nigeria. Below are some of the popular ones that the latter part of this article highlights:

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

To become a POS agent, one must open a bank account with the financial institution you want to work with or work under a bank you already have an account with. The latter is a better option because your transaction history can make you more qualified to be accepted as their agent.

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What Does It Cost To Start

To start a business like this, experts say the amount of money will range from N80-100,000 including money to get the POS machine.

This will also cover expenses in getting other logistics needed to start the business.


This is one of the most important things you must have thought about when deciding to run this business. A strategic location is a place where there are a good number of people who will need to perform simple financial activities.

Remote areas, student environments, markets, and places where banks and automated teller machines (ATM) points are far from the people can be a perfect location to begin the business.

Get a Shop or Kiosk

This will serve as the local or nearest financial institution to the people where they can perform simple transactions like withdrawal, payment, bank transfer, etc. Your shop or kiosk should be designed in such a manner that it notifies people you’re running a POS business.

You can achieve this with a small board put in front of your shop to alert customers from a far distance who are looking for a POS terminal.

Get the POS Machine

This is also one of the most important tasks of the business. According to experts, there are two ways of getting a POS machine, through commercial banks and or other finance agents.

The cost of acquiring the POS machine varies from issuing agents and how strong or advanced the connection runs. To get a POS machine from a bank, there are some requirements that ought to be met in accordance with the CBN directives.

However, whichever bank you decide to approach, it is to your advantage that you own an active account with them.

According to the CBN, the requirements for starting a POS business include a valid means of identification, for example, a national ID card, voters card, active driver’s license or an international passport.

A registered business name is also needed as well as a POS location, passport photographs, account number, phone number, business email address, and bank verification number (BVN).

Some of the designated banks assigned to issue POS machines include First Bank, United Bank for Africa, Guaranty Trust Bank, Diamond Access Bank, Zenith Bank, Wema Bank, Keystone Bank, Fidelity Bank, Union Bank among others. It Cost To Start.

However, there are alternative options to get the POS machines from which include microfinance banks, and mobile operators like Interswitch, Quickteller, Paga, FirstMonie, Opay, etc. In the case of the latter, the business operators get to work as agents while the mobile operators act as hosts.

Other major requirements include passport photographs, Bank Verification Number (BVN), Current Account references, and evidence of business registration (CAC Certificate)

Once your application is approved, you will receive the POS machine and you may begin offering your services to customers.

3 thoughts on “How To Start A POS Business In Nigeria”

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