Starting a POS (Point of Sale) business in Nigeria is a popular entrepreneurial venture because it is lucrative and easy to set up. Since many Nigerians lack easy access to traditional banking services, POS businesses provide a convenient solution for transactions like cash withdrawals, deposits, and bill payments. Whether you want to start a profitable business or diversify your income streams, this guide outlines everything you need to know to establish and grow a successful POS business in Nigeria.  

Why Should You Start a POS Business in Nigeria?  

Nigeria’s economy is large, and despite the CBN cashless policy, cash is still king. Hence, many regions need POS services, given the limited banking infrastructure. The business bridges the gap for customers in rural and semi-urban areas who need access to financial services without visiting a bank. For entrepreneurs, this represents a steady income opportunity with affordable startup costs.  

Steps to Launching a POS Business in Nigeria  

1. Research the Business Environment  

• Understand the demand for POS services in your chosen location. Rural areas and underserved urban communities often have the highest demand.
• Study your competitors, assess potential transaction volumes, and identify key factors that encourage customer loyalty and retention in this business. 

2. Define Your Service Offerings

While cash withdrawal and deposit services are the backbone of most POS businesses, you can get more customers and maximise earnings if you offer a wider range of services, including;  

• • Bill payments (electricity, water, DSTV, etc.)  
  • Airtime and data recharges  
  • Fund transfers  
  • Account balance inquiries  

3. Acquire a POS Machine

You need a functional POS machine for your operations. You can get one by partnering with

• POS service providers/mobile money operators like Kashzoo  
• Banks such as Wema Bank, Zenith Bank, or First Bank.   

4. Register Your Business
Although this is not mandatory for small operators, you can consider registering with the Corporate Affairs Commission (CAC) to add professionalism which will position your business for future growth.  

5. Prepare Your Startup Capital  

The initial investment usually ranges from ₦50,000 to ₦150,000. This is required for;  

• • POS terminal fees  
  • Cash for daily transactions (to support withdrawals)  
  • Branding and setup costs   

6. Select a High-Traffic Location
Location is key to the success of your POS business. Choose areas with significant foot traffic and limited access to banking facilities, such as markets, transportation hubs, student areas or densely populated neighbourhoods.  

7. Obtain Necessary Licensing  

To operate legally, you will need an Agent Banking License. Requirements include:  

• A valid form of identification (e.g., National ID or Driver’s License)  
• Bank Verification Number (BVN)  
• Proof of address (utility bill)  
• Passport photographs  

8. Promote Your Business and Build Trust  

Create awareness through visible sign boards, flyers, and social media. Reliable service and transparency in your operations will earn you trust and encourage customer retention.  

9. How Much Can You Earn in the POS Business?  

POS agents earn commissions on every transaction, such as:  

• Cash withdrawals: ₦50–₦100 per transaction  
• Deposits: ₦50–₦100 per transaction  
• Bill payments:₦20–₦50 per transaction  

With consistent customer traffic, your daily earnings can start from ₦5,000 to ₦20,000, depending on your services and location.  

Potential Challenges and Solutions  

Running a POS business has challenges that can be addressed to ensure smooth operations. Below are a few challenges;  

• Network disruptions cause transaction delays, so ensure you partner with reliable providers like Kashzoo to minimise issues.  
• Security risks like theft and fraud can be avoided by investing in secure locations and protective measures.  
• Cash flow limitations: Maintain sufficient funds to meet withdrawal demands.  

 Our Take

The POS business in Nigeria is a lucrative opportunity to provide essential financial services while earning a steady income. So, if this is an enterprise you are interested in, start by planning, selecting a strategic location, and delivering exceptional customer service to establish a thriving business that supports your community’s financial needs.  You are a step away from becoming a trusted financial service provider in your area!