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How to start POS business in Nigeria for beginners

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How to start POS business in Nigeria for beginners

One of the most popular businesses in Nigeria nowadays is the POS business. This business is more profitable in towns where there are no banks. It is also helpful in areas where ATMs are insufficient to meet the financial needs of the local people. Through a POS machine, an agent makes cash available to people in exchange for a commission or charge. This business has been helpful because it has hired thousands of people. Read on as we discuss how to start a POS business in Nigeria and the Point of Sale Business requirements and profitability.

How Profitable is POS Business?

As we mentioned earlier, a POS business can be a very profitable venture. It is even better when you have several branches. This is because people visit POS centers every day for their financial transactions. They also prefer the POS because of the stress that comes with dealing with banks. Starting a POS business in Nigeria does not need a large amount of capital. You can begin earning money on the same day that you open your doors.

An agent earns from the commission they receive from every customer who comes to their POS shop. For instance, if a customer needs N20,000, you will charge him N400 for the transaction. You'll also communicate the information with your POS provider. You can take N240 as a commission, while the company's bank would take N160 as a commission. POS agents in Nigeria can earn between N8,000 and N15,000 per day on average. This depends on their location and how well they've gained trust with their consumers. 


 In Nigeria, the POS sector is incredibly profitable since some locations lack banks. So, POS agents have taken on the role of de facto banks. Also, a POS agent does not need to sell themselves. The reason being that customers need them for the convenience they provide. So, obtaining a favorable location is the main trick in ensuring the success of this venture. It would be best if you got a place that is far from banks and ATMs. An agent in a location close to banks wouldn't compare profits with an agent who chose no banks. Without a doubt, the latter will earn much more than the formal.  

What are the Requirements for POS Business in Nigeria?

The POS business doesn't need much from the person hoping to become an agent. Yet, there are some steps to follow to get into the business. But before looking into the steps, let us discuss the required documents. Read on!

Required Documents for POS Business

Some of the necessary documents are as follows:

  • Two photos of your passport.

  • Bank Verification Number (BVN).

  • References to 2 current account numbers.

  • Credit Bureau Report.

  • Valid means of identification.

  • Tax Identification Number.

  • The Memorandum of Association.

  • Corporate Affairs Commission certificate.

Step 1: Own a Business

An aspiring bank agent must have an established business. This business must have been in operation for at least 12 months to be eligible. Also, you must have a shop or office from which to conduct business. Because the POS company has to do with money, dealing with caution is necessary. CBN is quite selective when it comes to the types of businesses that qualify to act as agents. As a result, banks are careful when choosing their agents. It is also essential to register with the Corporate Affairs Commission as any of the below:

  • Trusts, or any other body other than religious organizations or non-governmental organizations (NGOs).

  • Sole Ownership.

  • Partnership.

  • Cooperative.

  • Limited Liability Corporation (LLC).

  • Entities with a Public Purpose.

Step 2: Go to the bank of your choice.

Almost every Nigerian bank supports agent banking services. So, you are not limited to a bank. The first thing to do is to choose a bank of your choice. Then, contact the bank and get information about their requirements and procedures. The CBN guide allows you to act as an agent for as many banks as you are capable of serving.

As part of the requirements, you must have a business bank account set up for direct deposits. Then, provide some supporting documentation. Also, it is necessary to complete some agreement forms. These forms are about the transaction's terms and circumstances. The bank then reviews your application under CBN criteria. So, if you meet all the requirements, the bank agrees to work with you.

Step 3: Get the necessary equipment.

The next thing to do after the bank's approval is to get the necessary equipment. The bank gives you every piece of equipment you need for the POS business. Below is the essential equipment.


  • Card reader.

  • Personal Identification Number.

  • Point of Sale Terminal.

  • Barcode scanner.

Step 4: Location

Frankly, the success of this business solely lies in the location. As a bank agent, your target should be a location with few or no banks and ATMs. If you discover that an ATM is not dispensing cash, advertise your business to that location. Some of the folks who are in desperate need of money will need your service. Once you've found a suitable place, you should build a shop. Make sure to provide enough space for you and your customers to move around. Furthermore, a banner is significant, as it makes it easier for people to know what you do from afar.

Step 5: Do your job

Once you have followed the above steps, the next thing to do is to start your job. You got your card reader, phones, mobile app, and POS terminal. You are good to go! Below are the services you will render to your customers.


  • Cash withdrawals and deposits.

  • Bill Payments such as airtime, data, etc.

  • Money Transfer.

  • Loan Repayment.

  • Balance Inquiries.

  • Mini statement generation.

How Much Do I Need to Start a POS Business in Nigeria?

There is no specific capital to start a POS business. Your capital can vary depending on the items you get for free. However, the essential thing is the money you'll give your customers. To be on the safer side, you should have a minimum of #150,000 for a start. Though some companies provide free POS machines, you must meet their eligibility restrictions.

How to Start POS Business with Zenith Bank

Zenith Bank is a Nigerian commercial bank, and it is one of the best in the country. One of the bank's top priorities is to bring banking to the people who need it the most. The Z-Money agent banking service is a financial inclusion program. The bank implemented it to broaden its retail reach across all segments of its clients. To apply to work as a Zenith bank representative, you must complete an application form. These are some of the information you will provide in the form.


  • The full business name.

  • The account number of the business owner.

  • The business email address.

  • Phone numbers.


Do not forget the other minor details too. Then, send the form to [email protected] Also, send a copy to [email protected] in the body of the email. It is also essential to keep the email address in mind in case you have any problems.

After that, the business owner will need to sign a POS agreement document with the bank. As an agent, you must adhere to all the general standards discussed earlier in this article. Then, you will receive a free POS and will be able to download the application into an Android phone.

How to Start POS Business with GT Bank

Some other banks don't care about your account type before granting your request. But GT bank bothers about it. For the POS machine at GTB, only current account holders are eligible to receive one. Additionally, your account must be no more than six months old. The required documents are the same for every bank, and we have already discussed this in detail. Check out the steps to become a GT Bank agent in the section below.


  1. You need a Business Current Account to operate your business.

  2. Either send an email to [email protected], visit your local branch, or chat with your account officer. You will get a unique POS request form, as well as an agreement contract, which you will need to sign.

  3. You should expect to receive your POS in around 14 days, delivered to your business location. Note that while POS terminals are free, the bank will receive a fee of 0.75 percent from each payment you accept. This is to cover the costs of the services provided. These services include routine free maintenance of the units.

How to Start POS Business with First Bank

First Bank is one of the banks that provide free POS machines to its agents as long as they meet the requirements. In First Bank, they call the bank agents "FirstMonie agents." To become a FirstMonie agent, you need to meet specific criteria. Below is the list of criteria to meet to become an agent.


  • You should have your space.

  • Your active First Bank account should be at least a year old.

  • As a private person, your capital should be about #60000. But if you have a registered business name, you should have at least #200000.


Take note of all the necessary documents listed above for the application. After compiling the documents, go to any First Bank branch to apply as a FirstMonie agent. Please note that if you don't meet specific requirements, the bank won't offer you a free POS machine. So, take your time in compiling your documents and filling the form. 

How to Start POS Business with OPay

OPay is an ePayment wallet developed by the Opera software firm and debuted in 2012. It is a mobile payment platform that enables its users to pay for services through a mobile phone. In OPay, there are four layers of KYC. KYC is an abbreviation for "Know Your Customer." The Central Bank of Nigeria established the Know Your Customer (KYC) regulations. Let us look into the four levels of KYC.


Level 1: This is the point at which you register. The account has a cash and transaction limit of 50,000 Naira in total. It also has a daily transaction restriction of 5,000 Naira.


Level 2: Your BVN, address, and date of birth are necessary for this level.


Level 3: You must have a valid identity card and a passport or any other item. You must have had them for more than three months before registration as proof of your address.


Level 4: This is the agent level. You must enter your company's information. OPay will respond shortly after you have submitted your application.

 

To become an OPay agent, you must meet specific requirements. First, you need a mobility resource. Then, download the OPay app for Android and complete the registration process. Also, agents should be knowledgeable about the app's transaction patterns and user interface. As a result, the OPay App must be capable of supporting several transactions at the same time. But, there are steps to follow to get an OPay POS machine. Read on!

Below are the steps to take to apply for an OPay POS machine.

  • Enter your login information into the OPay app on your device.

  • Select the 'Merchant Application' icon from the drop-down menu.

  • Fill out the form with all the required information.

  • Upload your transaction history from the last three months.

  • Please upload a valid identification card.

  • Please take a picture of your company's workstation and publish it on the site to share with others.

  • Send your submission for review.

 How Much is a POS Machine in Nigeria?

The price of a POS machine can vary, depending on the type you want. However, the prices are within #50000 to #80000. The fastest method of obtaining a POS machine in Nigeria is through your bank. To get a POS machine, most banks will want you to fill out some paperwork and have an account with them. A current bank account is necessary to get a POS machine from any financial institution. Some banks will accept you even if it's a savings account you run. Furthermore, some organizations provide POS machines for a single cost.

Conclusion

Having a POS business is an additional source of revenue. It is a great way to extend your services and make cool extra cash aside from your primary source of income. So, what next? You don't need to lay back if you have been thinking about this business. All you need to do is follow all the steps in this article. You will not run at a loss if you go about it the right way. Good luck!

 

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