Complete Guide: How to Start POS Business in Nigeria 2023

Complete Guide: How to Start POS Business in Nigeria 2023
Complete Guide: How to Start POS Business in Nigeria 2023

Even though it is not an untapped business in Nigeria, the POS business is one of the fastest-growing businesses that continuously get new entrepreneurs daily.
Why is that? Of course, if not because of the massive amount of money that can be made from the POS business in Nigeria, no one would even turn attention to it as it is too saturated.

Despite being saturated and competitive, the POS business is very profitable as you can make up to 20,000 Naira daily and even more as a POS agent if you get things right.
Yes, it is profitable, and anybody can start it (even students), but to make it a success and make a huge amount of daily income from the business, you need to know the in and out of the business, how to start it, and what to do to maximize your profits.
To supply you with all that information, we created this post to show you exactly how to start a POS business in Nigeria, how much you need to start, and how profitable it is. That’s not all, but we will also provide some bonus tips on how to succeed as a POS agent in Nigeria.

If you’re ready to know all that and kick-start a profitable POS business in Nigeria, take a seat, and let’s get started!


What you should know About POS Business

Introduced by the Central Bank of Nigeria (CBN) in 2013, POS means point of sale. The business involves completing simple financial transactions for people and getting paid for your service.

The services rendered by POS agents are made possible through POS service providers, which usually include banks, fintech companies, and microfinance banks.

With the two brief explanations above, I believe you’ve understood how the POS business works. That is, as an agent, you’ll get a POS machine from banks or fintech companies, provide simple financial services for people, including withdrawal, deposit, transfer, airtime purchase, etc., and for every completed transaction, you’ll charge your customers a fee, and sometimes get incentives from the POS provider.

That’s simply how the POS business works in Nigeria and how agents make money (i.e., through charges and incentives).

Cost of Starting a POS Business in Nigeria

Now that you know how the POS business works and how to make money, how much do you need to start a POS business in Nigeria?

POS business is one of the businesses that doesn’t require huge startup capital. Therefore, it can be started both on a small scale and a larger scale.

On a small scale, you can start a POS business in Nigeria with 100,000 Naira, and on a larger scale, you’ll need 250,000 Naira and above to start this business.

How Profitable is POS Business in Nigeria

Questions usually asked by many entrepreneurs looking to start a POS business in Nigeria are – Is POS business profitable in Nigeria?

Yes, the POS business is very profitable and lucrative to venture into, as it is a daily income business that lots of money can be made from day in and day out.

As a POS agent in Nigeria, you can make up to 10,000 Naira and even more daily. Although, you can make way less than that amount. This is because the profitability of a POS business depends on your location. 

Take, for instance, a brother of mine in Kogi state – he is a POS agent and has his kiosk at a market entrance. On a bad day, he makes at least 5,000 Naira; on an actual market day, he makes at least 10,000 Naira in profit.

You can’t compare his sales to those agents on a regular street, although they also make daily income, but not as high (usually one-third the amount) as those at an ideal business spot.

How to Start a POS Business in Nigeria 2023

Now, to the main topic of this post! Like every business, you’re bound to fail if you start a POS business without prior knowledge.

The following is a step-by-step guide on how to start a profitable POS business in Nigeria.

Start With a Little Market Survey Like every other business, even though you may gain a lot from this blog and other online resources about starting a POS business, you still need offline research.

This offline research is often based on your location/area. Since we can only provide you with a general guide on starting a POS business in Nigeria regardless of your location, you’ll need to relate with POS agents close to your area and ask them some questions about the business.

  1. How does the business work in your area?
  2. How profitable is it?
  3. How much capital is required?
  4. What are the risks involved?
  5. Are there some tricks to make it more profitable?
  6. How much is charged per transaction?
  7. Which POS machine provider has the best service/network in your area?
  8. And so on.

You can still think of more and ask. Once this is done, you’re ready to become a POS agent.


Create a Business Plan Based on Your Survey Result

Based on the market survey results, you’ll need to create a business plan for your POS business. Although not compulsory, it will help a lot anyways.

Unlike other businesses where your business plan includes some complicated stuff, like an advertisement, although it is among, for a POS business, the significant things to point out in your project are your aims and objectives and an estimate of the startup cost.

Get a Good Location

As I said earlier, the success of a POS business depends on your location. You can’t expect to make the most of this business having your shop in an estate.

If you want your POS business to succeed, you need to take your time to secure a suitable location based on the following factors.

#1. Busyness of the Area: First of all, what you need to consider while looking for a location to start a POS business in Nigeria is how populated the area is.

The busier the area, the bigger your sales as well as profits. Ideal locations for a POS business include markets, students’ areas, filling stations, malls, supermarkets, post offices, and so on.

#2. Competition: Second thing to consider while searching for a location for your business is the number of POS agents already in the area. Usually, the best place to start this business is where there is no POS agent. 

However, since the business is saturated, it is hard to find a street with a POS agent, so just ensure there is at most one POS agent in the area where you want to start yours.

#3. Security: Security is essential to note while looking for a location for your POS business. Of course, we all know that security is a big issue in the country, especially if you live in Lagos, where you can be robbed of your money even during daylight.

Since running a POS business means that you’ll be handling a lot of cash, POS outlets are prone to shoplifters and even armed robbers. So, take your time to do thorough research about the area where you want to start your business and ensure that there are little to no criminal records in the area.

#4. Network: Lastly, network issues! If you’ve ever gone to a POS and the machine reads transactions declined, and after walking a few steps to try another which was successful, you’ll know what this means.

Although this deals significantly with the POS service provider, in most cases, location is also a factor. However, if step one (market survey) is well done, this shouldn’t be an issue, as you would have known the best type of POS service provider that works well in your area.

Apply for a POS Machine

Considering that you have your capital ready, the first thing to do with the money is to apply for a POS machine. There are tons of POS service providers in Nigeria where you can get POS machines; they include banks, fintech companies, and microfinance banks.

While you can quickly get the machine from those platforms, there are some things to put into consideration while applying for a POS machine in Nigeria. They include:

  1. Cost of the machine
  2. Network
  3. Transaction charges
  4. Bonuses/Incentives

Usually, many POS service providers offer the machine for a cautionary fee, and sometimes as outright. Both acquisition methods come with a price. More so, the cost of a POS machine varies across all POS service providers, so compare the fee and transaction charges before applying for a POS machine.

The network is also significant to take note of while looking to acquire a POS machine. Here are some of the best POS service providers based on the web.

  1. Firstmonie (First bank)
  2. Opay
  3. Monie Point
  4. Baxibox
  5. Kudi
  6. PalmPay
  7. Paga


Arrange for a Startup Fund

The basics are done once you complete steps one to three; now is the time to start the business. First, you’ll need to raise a startup fund to finance all the initial investments required for the business.

Since the POS business does not require multiple hundreds of thousand naira to start, you should be able to find a way to raise money to start.

Set Up Your Business Place

Getting a POS machine after applying often takes days to a few weeks. So, while waiting, you can start arranging for a business place.

POS business doesn’t require big shops or decoration of shops, as you can start with just an umbrella, a table, and two chairs.

Once the POS machine arrives, OT usually comes with some promotional materials such as flyers and banners, so you can just complete setting up your shop by making a board for the banner and hanging the flyers.

Start Rendering Financial Services and Make Money

Once you’re done setting up your shop, what is left now is to start the business thoroughly.

You can use the manual that comes with the POS machine to learn how to operate the machine, do some test transactions for yourself, and once you’re good at handling the machine, start rendering financial services and making money.

How to Succeed as a POS Agent in Nigeria

Blog - The POS business in Nigeria - How Profitable is it?

Step one to step seven above are precisely how to start a POS business in Nigeria from start to end. But we’ve got a bonus tip if you want to quickly succeed with your POS business.

The following tips will help you succeed as a POS agent in Nigeria.

Start with a reasonable capital.

Just like every other business, your profit in this business is also based on the amount you started with. If you start with a small capital, you may miss out on more significant transactions that will make you a lot of profit.

For instance, if you start with just 50,000 Naira and get a customer that wants to withdraw 100,000 Naira, you could miss out on a 1,000 Naira profit since you don’t have enough cash.

Location is Key

I can’t emphasize more on this, but your success as a POS agent is based on your location. Although many people start a POS business from the comfort of their homes, much money can’t be made from such.

If you want to be very profitable with this business, you must situate your shop at a business spot such as markets, motor parks, and so on.

Offer Discounts on Bigger Transaction

This strategy works well, especially if your shop is in a market. Since many people come to the need to buy and sell, if you offer sellers who deposit huge discounts, they are more likely to return and become loyal customers.

Since they transact huge amounts, their profit will be huge, and if they keep coming back every day, imagine how much you could be made from just one person, not to talk of having two or three businessmen or women patronizing you daily.

FAQs about POS Business 2023 

Can I start a POS business with 100000?

You can start a small-scale POS business in Nigeria with 100,000 Naira.

What is the best bank for POS business in Nigeria?

The best bank for POS business in Nigeria is First Bank (Firstmonie POS) and Opay (Opay mobile POS).

How much do I need to start up a POS business in Nigeria?

You’ll need at least 70,000 Naira to start a reasonable POS business in Nigeria.

Can I start a POS business with 50k?

Yes, you can start a POS business with 50k, just that the POS machine will be acquired on a cautionary fee.

What is the best location for a POS business?

The best locations for a POS business in Nigeria are markets and motor parks.


POS business is undoubtedly one of the best businesses that generate consistent daily income if done correctly, which I believe this article has provided for you. So, what are you waiting for? Take action now!


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