A recent survey conducted by Nairametrics in Lagos, Abuja, and Port Harcourt sheds light on the thriving Point of Sale (PoS) business in Nigeria.
PoS agents, depending on location, earn between N5,000 and N12,000 daily.
This burgeoning industry, fueled by the simplicity of the technology, has created approximately 1.5 million jobs, surpassing the remuneration of many degree holders.
Operators attest to the profitability, with some earning as much as N360,000 monthly, outpacing salaries in traditional banking roles.
Several operators shared insights into their successful PoS businesses. Notably, strategic location selection plays a pivotal role.
Areas with high foot traffic, such as markets, universities, and commercial districts, prove lucrative. Offering additional services, like bill payments and money transfers, enhances customer attraction and retention.
Partnerships with other businesses and prioritizing exceptional customer service contribute to building a positive reputation in the competitive landscape.
To start a PoS business, obtaining a PoS machine is essential. The cost varies based on factors such as brand, quality, and features. Prices range from N50,000 to N200,000.
Some service providers offer free machines to agents, further reducing the entry barrier. This affordability contributes to the accessibility of the PoS business, making it an attractive venture for entrepreneurs.
An agent, Rose Ubong, told Nairametrics that effective marketing strategies, including location choice, customer service, and incentives, play a crucial role in attracting and retaining customers.
She added that overcoming challenges such as network issues, fraud, high commissions, competition, and regulatory compliance demands careful planning and continuous adaptation.
Starting a PoS business involves several key steps. Thorough research to understand industry dynamics, requirements, and challenges is crucial.
Raising start-up capital, choosing a prime location, and selecting a reliable PoS service provider are foundational steps. Registration with the chosen provider, advertising the business through various channels, and ensuring compliance with Central Bank of Nigeria (CBN) regulations complete the setup process.
The PoS business in Nigeria has experienced significant growth since the implementation of the agent banking system by the Central Bank of Nigeria in 2013.
As of July 2021, there were 986,252 registered PoS terminals in Nigeria, and the industry recorded N1.15 trillion in transactions by March 2023.
Globally, the PoS market is projected to grow from $80.8 billion in 2018 to $155.6 billion in 2028, showcasing its importance in the retail industry.
That is an indication that there is still a wide room for growth in Nigeria.
Moniepoint claims leadership in the market with over 600,000 agents, followed by OPay and Palmpay.
However, merchants have begun to overtake agents in the PoS market, with over 1.3 million merchants on the Moniepoint platform.
The market continues to thrive due to the convenience it offers in providing various financial services, from accepting payments to managing inventory.
There is no doubt that the PoS business in Nigeria presents a viable and lucrative opportunity for entrepreneurs. Its affordability, coupled with the potential for high daily earnings, positions it as a competitive alternative to traditional banking roles.
Success in this business hinges on strategic location selection, effective marketing, and adapting to industry dynamics.
As the PoS market continues to grow globally and in Nigeria, entrepreneurs entering this space should prioritize customer service, innovation, and compliance to ensure long-term success.
Five bankers interviewed by this medium revealed that most banks, in a bid to reduce overhead costs opt to engage staff on a contract basis.
With that arrangement, remuneration for contract tellers ranges from N60,000 to 120,000. On the other hand, remuneration for fully engaged staff among commercial banks ranges from N120,000 to N180,000.
Clearly, the PoS business appears to be more rewarding than working as a teller in a bank.
In terms of viability, Salif, a PoS operator near Utako Market in Abuja told Nairametrics that with diligence on his PoS business, he earns enough to care for his family of four.
Another agent in Utako Market, who uses her machine to make payments and to receive payment from customers who buy her cosmetics, said on average she makes about N7,000 daily.
She noted that many people coming to the market are impatient to withdraw money from the nearby banks and, hence do not mind paying a withdrawal fee of N100 or N200. “On a daily basis I can easily do more than 50 of such transactions and make my money,” she said.
Chidi Nwafor, who operates his PoS business at a transit point in Iyana Ipaja in Lagos, said it is common to make up to N10,000 a day by depositing and withdrawing money for commuters in the area daily.
- “I don’t come here for business on Sundays, but if you calculate 26 days in a month multiplied by N10,000, I am easily making more than N250,000 in a month. Most cashiers in the bank no dey make reach me,” he averred.
- An operator near Jakande Estate in Isolo Local Government Area, Kemi Asemota, revealed to Nairametrics that she makes more than N4,000 between 6:00 a.m. and 9:00 a.m. from her PoS business. “From this business, I feed my family and pay my son’s school fees,” she boasted.
On his part, Chinonso Akudinobi, who operates two machines in Alaba International Market, said he makes up to N12,000 some days.
Dieye Wilson, a resident of Port Harcourt, and PoS operator in Diobu, said like everywhere else in Nigeria, she charges N100 for every N5000 deposit or withdrawal transaction.
Wilson said her PoS business affords her a good life. She said has been in the business for the past three years and has been able to buy a small car from her proceeds.
According to the Nigeria Inter-Bank Settlement System (NIBSS), as of July 2021, there were 986,252 registered PoS terminals in Nigeria.
According to the National President, of the Association of Mobile Money and Bank Agents in Nigeria, Victor Olojo, there are over 1.4 million mobile money and banking agents across the country.
Nairametrics reported that the number of PoS terminals deployed by merchants and individuals rose to 1.8 million in March 2023.
This represents a 75% increase year on year when compared with the number of deployed terminals in the same period last year, which was 1.04 million.
The value of transactions over the PoS terminals also increased to N1.1 trillion in the month, the highest monthly record on the platform.
Indeed, the simple PoS technology has opened up to the general public
The POS business is a very lucrative business. If you know what you’re doing and are disciplined in spending. As lucrative as it is some are not profiting much either because of low. cash. When you don’t have substantial capital you will struggle in the business. Also punctuality is key both in arrival time and opening days… And careful day to day spendings… Should be tracked