How To Start Profitable POS Business In Nigeria: 3 Hidden Secrets

How To Start Profitable POS Business In Nigeria: 3 Hidden Secrets

POS business has been making waves in the country for a decade, right after the central bank of Nigeria [CBN] introduced the cashless policy in 2012

The business attracts notable benefits from agent to consumer end, as it is lucrative enough that even most bank employees earn lesser than most POS agents likewise coming with ease of escaping unending queue feelings under the scorching sun

The primary purpose of the point of sale [Point of Sale] machine is to enable withdrawal, bill payments [DSTV, GOTV, PHCN, Startimes], and airtime sales alongside a few other utility bills.

This is where you come into play as an agent, you are earning off these transactions and other untapped hidden money-making opportunities that come with the business concisely discussed in this article

Also Read: Starting A Supermarket business In Nigeria? 10 Things To Know

How Much Do You Need To Start A POS Business?

Agent banking service, commonly known as point of sale [POS] service is one of the prolific small-scale businesses in Nigeria you can start with as low as #100,000

First on, you have to know the stated budget above would be ideal to kick start your POS business in Nigeria only if you are starting small

Starting small could be getting a wooden bench for around #2,000, an attractive banner that best portrays your business for #5,000, and a medium-size telecommunication business umbrella, which may set you back for #15,000

I’d advise you to budget around #50,000 for your POS machine procurement, while the rest of the change could be set aside as operating cost [withdrawal & deposit], I think we have around #25,000-#29,000 left, which is still within the reasonable fund to take off

Also Read: How to start a successful delivery logistics business in Nigeria

How Much Can You Earn With POS Business?

Your earning potential in this line of business is unlimited with a hungry lion work ethic, this is why a business could be labelled as small-scale while pulling in millions of naira every month

Am not saying you can pull the stunt with POS business, it’s just an analogy to justify how unlimited your income potential could be when business is on the line

POS service centre could charge an average of #100 per transaction on withdrawals from #1,000 to #8,000, and #200 for transaction on withdrawal from #9,000 to #15,000 while the charges snowballs as the withdrawal amount increases

The same is applicable to deposits, the charges from the agent side are lower though, but most POS agents charge the same flat rate to cancel out the confusion and at the same time cram their pocket, am sorry if I pulled some triggers

POS companies take less than 15% cut per transaction, if you charge #100 per transaction, you’ve already net a little over #80-#90 after their cut

The question is, how many transactions can you pull per day? If you keep up with this article until the end, I guarantee your POS daily, weekly and monthly earnings won’t be at the mercy of your patrons but your personal decision

I think this part is on you, but if you want a specific answer, I’d say most POS agents earn an average of #3,000-#5,000 daily profit and north of #10,000 daily profit for top earners

Also Read: 10 Highly Profitable Handworks To Learn In Nigeria To Make Money

What Are The Steps To Get A POS Machine?

Am never a fan of setting a POS business upon a bank POS machine for a few stringent in their policy, however, you could walk straight into a bank of your choice to secure one if you would not mind taking the route, otherwise, you could use the preceding section for better options alongside other steps to start profitable POS business in Nigeria 

Fintech companies

Being said, the 2 most popular POS machine merchants are banks and fintech companies, and below are popular and reliable POS merchants with friendly policies and active customer care channels

  • Moniepoint POS
  • Opay POS
  • Kudi POS
  • Palmplay POS
  • Quickteller Paypoint
  • Firstmonie POS
  • GTB POS

There are still many more out there, feel free to explore as many as possible and weigh your options to get in the game as early as possible

Find a Location

The last place you want to install your POS vendor, is a few meters away from ATMs, as it’s your greatest competitor, you are offering the same services but yours attracts a price for the offer while ATMs do this almost for free, yet it can profitable in some case [scenario where ATM doesn’t dispense]

Situating your vendor closer to the market might also be a bad idea, as truckloads of cash changes hands in the marketplace daily, POS business may never thrive in this area despite the settings

I’d recommend considering location with institutions, almost every student and lecturer have a debit card with higher purchasing power

Rural areas will also make a good spot, ensure you source for commercial spots and your daily target won’t be discouraging

Submit your application

The application process to become a POS agent varies from one provider to another, some will take a few days, while some will take 2-3 weeks

Whichever the period, I still think this shouldn’t be your top priority, yet I have to outline this to paint you the liable time frame of your application approval

Also Read: 10 untapped businesses to start with #50,000 in Nigeria

4 Factors To Consider When Choosing a Befitting Type Of POS Machine For Your Business

  1. Business size

There are the various standard of POS machines, the cheaper ones will set you back for low investment but cost you more in the long run

Only a few customers will be patient enough for you to rock back and forth over the shortcomings of a low-budget POS machine unless your patrons don’t wait for turns, which is why you have to tether to your agent banking service, a suitable POS machine for the business size and capacity

The fintech companies have a different standards of POS machines, you can request from your POS aggregator the model that best suits your POS business from their variants, and it will chiefly be issued to you

  1. Network strength

There is no better scenario or analogy to describe this part than to inquire how it feels when you hit a highly anticipated YouTube video to experience a high buffering rate

Poor internet connection is much worse than that, as you lose customers while also getting hurt in the process

Indulge some feasibility studies, and visit your proposed POS business spot, you don’t even need to a have POS machine at hand, any smart device [Smartphone] should validate the network signal strength of the spot

Enable internet browser, surf the web to ascertain the internet speed, and ensure doing this for multiple network service providers to have a minimum of 2 solid strong network coverage in the environ

  1. Power supply

I don’t think I ever run into a POS agent or vendor solely recharging the POS machine with a popular alternative power supply [Gasoline generator], and I bet you don’t want to be the first for reasons not best explained here to save time

POS machine is powered by a lithium-ion rechargeable battery, when your POS machine is still spanking new, you won’t have to worry about the power supply, but when the battery integrity is deteriorating, “we are sorry, we just ran out of battery”, shouldn’t be an excuse to lose customers and higher charges transaction

Get a power source in place, either from other businesses around or house you could plug your pos machine to trickle in some battery juice

  1. Patronizing power

Weigh your options, take your chances, don’t overthink any action that will upscale your daily earnings, if possible create an average daily target, and stop for nothing to attain it

Explore other streets, and towns, to see if relocation will be of great impact on your earnings, you just have to be intentional about this business

Also Read: 15 Ways To Create Multiple Online Source Of Income In Nigeria

3 Ways to Earn More With Your POS Business

There’s a saying by a popular billionaire that if you do not make money while you sleep, you’ll work until you die

This is why I have brainstormed you few other business ideas to earn more money with your POS business

  • Side Hustle: You should consider using it as a side hustle for other businesses, this way, you only share a fraction of your weekly or monthly income as salary to someone who keeps the business running in your absence
  • Become An Aggregator: Do you realize you can make more money promoting or recommending POS terminals to agents

The beauty of this is that your reward is never a one-time payment or fee, you automatically get rewarded per generated transaction [withdrawal, deposit, utility] from referrals [vendor or agent]

Review every POS agency aggregator policy and commission rate, sign up for your desired agency and then start promoting shamelessly 

  • Add other Businesses: What is your existing business, or what business do you plan to set up, you should either take the POS business to the business or bring it to your POS vendor

 You can place other businesses side by side with your POS business, You only need an eye-catching and attention-getting banner that is visible to a sufficient number of pedestrians.

  • Source For Busy ATMs: I'm sorry to be the one to burst your bubble, but there could be very bad days, where the client's turnover rate would be so low, or where your daily transaction rate would be discouraging for one reason or another. There could also be very good days, where your daily transaction rate would be encouraging.

There’s nothing bad in reaching out to some people around banks or busy ATMs to always notify you of the day when the queue is too unbearable for people

Just ensure you negotiate a reasonable commission rate with these onlookers, as they are your eye whenever the coast is clear, 5-6 ATMs in the city are enough for this

Whenever you receive a positive signal from just one onlooker, I bet it with you, 5 withdrawals from your POS machine would have paid for the whole party [onlooker commission fee, your transport fare]

An hour at this type of ATM could net you the full daily income of some POS vendors

Also Read: How to start ecommerce business in Nigeria: 7 simple steps

Conclusion

Brother! Please never let people think you’re failing or not doing enough in life, any business or source of income netting you a little over #10,000 per week, add it to your income source while exploring other opportunities

Remember, it’s awesome to take full control of one’s life living average life than living a luxurious life under the mercy of a human like you

Shove procrastination down the drain and take the bold step today

See you on the inside!

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