How to start a POS business in Nigeria

Gradually, the POS business has become very lucrative in Nigeria. Everyone is making money from it, and you too can. In this post, you will learn how to start a POS business in Nigeria.

You will also learn the requirements and the best banks to use for a POS business.

What is a POS business, and how does it work?

The Point-of-Sale (POS) business started in Nigeria in 2013 when the Central Bank of Nigeria (CBN) introduced the agent banking system.

A POS agent operates and processes transactions through a POS service provider. Providers of such services include banks, Microfinance banks and Fintech companies.

Here’s how the POS business works. The agent will provide many financial services that customers can make use of. This includes withdrawals, money transfers, payment of bills, etc.

Amongst many other financial purposes, a POS device allows the agent to process transactions using the customer’s debit card. All the agent needs to do is to choose the transaction type on the POS terminal and the amount.

The customer will insert his/her debit card and provide the four-digit PIN. The POS network will connect the ATM card to the bank’s server and process the transaction. If it’s successful a transaction receipt will be printed for the agent and customer.

Is the POS business profitable in Nigeria?

Yes, it is. And here’s why. Most Nigerian banks only open branches in the busiest commercial areas of each town. If the town is very large, there will probably still be only one location.

This means that people residing in far places will have to take a bike or bus to get to the bank and then hike another commercial transport back to their homes.

Many Nigerians encounter this problem every day, and POS agents help to relieve them.

Which bank is best for a POS business in Nigeria?

Most commercial banks in Nigeria provide POS services to interested agents. Here are some of the banks preferred by most POS agents.

  • First bank
  • Wema Bank
  • Opay mobile bank
  • Bankly POS
  • Monie Point POS
  • Kudi bank
  • GTbank
  • Paga
  • Zenith bank
  • Access bank
  • Quickteller
  • Ecobank
  • Baxibox
  • UBA

Note that you must first be a user of a bank before you can register as a POS agent of that bank. You must create an account in that bank and perform regular transactions.

Requirements for starting a POS business in Nigeria

1. A good location

2. A POS device

3. Startup capital

4. Official requirements

  • Recently taken Passport photographs
  • Bank Verification Number (BVN)
  • Account references
  • CAC Certificate
  • Tax Identification Number (TIN)

How to start a POS business in Nigeria

Now let’s get to the main topic of how to start your POS business in Nigeria. We have outlined everything in 6 steps.

1. Get a good location

Finding and securing a good location is very important for any POS business in Nigeria. If you have a good location, big sales and profit are assured.

How to identify a good location for a POS business

A good location will be a very busy place, and we all know that. But there are also some things to consider.

#1. Network

Have you ever visited a POS outlet and the agent told you there’s no network? Yes, it happens many times.

If you operate your POS business in a location that has a good network or service, you will perform all your transactions as smoothly as possible.

On the other hand, a location that has a poor network will give you a lot of trouble, most of which are not expected. If a customer were to visit your shop and you don’t have any network, such a person may not visit again (except if you’re the only POS agent in that area).

#2. Security

Running a POS business means that you will be handling a lot of cash. Everyone knows this, which makes a POS outlet one of the easiest targets for shoplifters, petty thieves and armed robbers.

This is why you should do in-depth research on any neighbourhood or area before sitting up your POS shop there. Ask around and determine the crime/theft rate.

#3. Competitors

If there are already more than two POS agents in your desired location, it is advisable to find another place.

Many people will have already been familiar with the existing outlets, and many will not patronize your shop in large numbers (unless one of your competitors is unavailable that day).

#4. Other factors

There are also other factors to look into before selecting a specific location for your POS business.

  • The population of people in that area
  • Profile of people in that area (most rich people don’t usually use POS)
  • Closeness to banks (not many people will use POS services when a bank is just a 10-minute walk away)

2. Create your POS business plan

The fact that it’s a localized business doesn’t mean you shouldn’t create a business plan. Though not compulsory, it will help you stay on point.

On your business plan, you will outline your aims and objectives. You will also calculate and estimate how much it would cost you to start your POS business in Nigeria.

3. Raise the capital required to start your POS business

This step is pretty straightforward. After you have estimated how much it would cost you to start a POS business in Nigeria, you should come up with a way of how to raise that amount.

Recommended: How to get funding for a new business in Nigeria

4. Acquire a POS machine

You can get a POS machine from most commercial banks in Nigeria, as well as a few microfinance and Fintech banks. Here are a few things to consider before choosing your POS service provider.

  • Network or service
  • Cost of POS machine
  • Transaction charges

Some POS service providers charge 0.65% and ₦10 for any transaction below ₦10,000. Transactions above ₦10,000 will cost ₦50. However, some banks only charge ₦10 for any type of transaction.

So make sure you compare with other POS service providers before making your choice.

5. Get a shop

Having done your research and made your decision concerning the location of your new POS business, the next thing to do is to look for a vacant shop in that area.

If it’s a very busy place such that all nearby shops are occupied or already rented out, then you should consider getting a small container or mounting a big umbrella.


A POS business is very profitable in Nigeria, as long as you find a good location. If you can’t find a shop to rent in your desired location, you can arrange for a container and operate your business there.

You can also get a big umbrella, a plastic table, and some chairs. This would add to your security (as no thief will rob you in front of everyone). However, you will be exposed to harsh weather conditions.

Whichever one you choose, it won’t affect your customers. You will earn a profit on each transaction, and it will all add up. By the end of the week, you will be smiling at how much profit you’ve earned.

Greatness from small beginnings!

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Victor Iyiola

Victor Iyiola

Victor Iyiola is a Content Writer with He has a great passion for Business, Finance, and Entrepreneurial topics. Victor is a big fan of
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