The POS business has remained one of the most lucrative businesses in Nigeria today. This is because people make transactions everyday, and ATMs are just available only at a few places in any location. According to a report by Punch, the total POS transactions made by Nigerians as of 2024 worth N85.91 trillion (2025 data not yet available), which is said to be seven times higher than the ATM transactions in the same period. That is to show you the high demand for POS transactions. And one thing is that the demand has continued to increase over the years.
Even when an ATM machine is close by, some people would still prefer using the POS if there is an agent closer. That saves them the cost and time of transporting to the ATM, since the POS agents will charge them just a token, and the transaction is always instant, not much standing in the queue like at the ATM. In fact, I have even seen many people doing POS business very close to a bank, and they are still making it there.
Since the introduction of POS transactions in Nigeria in the year 2012, there has been a tremendous increase in the number of people doing POS business, and today, everywhere is filled up with POS banners. Despite the number of people doing POS business, it would continue to remain lucrative. In a good location, even if there are more than 10 POS operators there, each of them would still make a good number of transactions before the day ends.
Today, the CBN now charges up to N100 for every withdrawal below N20,000 that you make on interbank ATMs. This scenario has also made many people adopt using POS for their transactions since the POS charges and those of ATMs are now almost the same.
How Profitable is POS Business?
As a businessperson, one of the most important factors to check when starting a new business is the profitability of that business. In this regard, the POS business is very profitable. If you are in a good location, you can be making up to N200,000 or above monthly.
How is this going to be possible? Remember that the least amount of POS charge is N100 per transaction; there are some transactions you can even charge up to N500 or even over N1000. This means that if you are in a good location where you make a total transaction amount of up to N700,000 or up to 50 to 70 transactions in a day, you can be earning at least N7,000 or above daily. That should be giving you about N200,000 or above in a month.
I know definitely that it would sound unbelievable to some people that one can make over N200,000 from a POS business, but the truth is that there may not even be a limit to the amount of money you can make from a POS business. It all depends on your ability to get a good location and manage your business very well.
You also need to always have enough cash for your transactions; if not, by the time customers come to make transactions and you tell them that cash has run out, some of them may not want to come to your shop again.
Not only is that POS business profitable, it gives you daily income and keeps your hands wet.
How Much Can I Use to Start a POS Business?
The cost of starting a POS business in Nigeria is from N100,000 to over N1 million, depending on the demand for transactions.
In a POS business, your capital is majorly the one for transactions. You may not necessarily need a shop to start a POS business; an umbrella, table, and chair are really enough unless you have other things you want to sell in the shop.
The cost of the umbrella may be at N5,000 or above. A table & chair may cost you up to N20,000. Then you may need at least one POS machine, and the cost of a POS machine ranges from N25,000 to over N50,000, depending on the type and brand. The cost of all the materials listed above should be about N50,000 or above.
Then, you may need at least N200,000 for your daily transactions. If you are in a good location where there is a high transaction demand, then N200,000 may not really be enough for you. For example, in a big market, a single customer can even withdraw up to N200,000 once.
In this kind of place, you may be needing up to N1 million or above for a smooth transaction. This is because you will need to divide the cash and use part of it to fund your POS machine; from there, you can be making deposits for customers. Then hold some as cash for withdrawals. If it’s not a commercial location, then N100,000 is even enough to start a POS business.
How To Start POS Business
Now that you have known some important facts about the POS business, let’s now guide you on how you can get started successfully and make a good profit in the business.
1. Get A Good Location
As pointed out already, while starting a POS business, you need to first look for a good location, because that greatly determines your profit in the business. How lucrative your POS business would be depends on where you situate your shop or POS outlet. Because the more transactions you make, the more profit you make.
Generally, a POS business would do very well in places or business areas where there is a large population but few or no banks or ATMs. Some of such good places are
- Close To Market
The market area is one of the best locations that will greatly favor your POS business. This is because both traders and buyers would always need the final point where they can run their transactions.
- Close To Mechanic Site
Motor or motorcycle repair site is another good location that would enhance the profitability of your POS business. This is because those that came to repair their cars, motors, or motorcycles don’t always have the right estimate of the amount they would spend.
In this, they would always need somewhere to make withdrawals if needs arise. Also, some may come to buy motorcycles or spare parts and may not have enough cash with them.
- Campus Environment
Thinking of the best location for your POS business, then a campus environment would really be a nice option. Campus environment greatly favors POS business because of the presence of students, especially if there are no banks close to the campus.
- NYSC Orientation Camp
National Youth Service Corps (NYSC) orientation camp is another hidden lucrative location that would favor your OPay POS business. Though NYSC orientation is not always a constant program, the amount of money you would generate within the 21-day orientation exercise in every batch would really surprise you.
2. Get A Good POS Machine
A good POS machine is one that has a good, stable network and a low charge rate. If your machine is the type that the network always frustrates in any transaction or the one that is fond of debiting customers on a declined transaction, then customers are already running away from you.
You may also need to get a popular POS machine that people are used to. This is because the rate of fraud today always scares customers whenever they see a POS brand that is strange to them.
3. Register Your Business with CAC
As of the year 2024, the Federal Government of Nigeria mandated that every POS agent should be registered with the Corporate Affairs Commission (CAC), and the practice has remained till date. As one that wants to go into POS business, you are expected to register your business, the Government needs to know you and be aware that you are doing that business.
This is not just for POS business, it is always a good practice that you register any kind of business you want to embark on. This always gives you legal backup and protection in doing that business.
4. Run Different Services For Customers
There are many services you can offer in your POS business, and always charge your customers. Some of these services are
- Withdrawal
- Deposit
- Money Transfer
- Opening Of Accounts
- Airtime Recharge
- Recharge Card Printing
- Payment Utility Bills like Electricity, Cable TV, Tax, etc
- Mobile Data Subscription
- Sports Bet, etc…
Then how would you really make money from the POS business by running these services listed above? Of course you know that you can actually make money from these services simply by charging your customers to complete any of the services for them.
Apart from making money from charging customers, you will also earn money from the commissions that your POS company gives you for every transaction you complete. Every POS company has specific commissions they pay their agents for every transaction they make with their POS machine.
Using OPay POS as an example, below is the structure of their commission for every transaction listed in the table:
| S/N | Service | Commission (%) |
| 1 | Etisalat Recharge | 4.5 |
| 2 | Aitel Recharge | 4 |
| 3 | MTN Recharge | 3 |
| 4 | Glo Recharge | 4 |
| 5 | DSTv | 2 |
| 6 | GOTv | 2 |
| 7 | Starttime | 2 |
| 8 | PHCN | 2 |
| 9 | Withdraw/ Deposit | 30 – 45 |
How You Can Make Over N200k Monthly In POS Business
The major way to generate income from a POS business is by charging customers for each service or transaction they make.
So, let’s break down how you would actually be making over 2000k in a month:
Depending on your location, you may be charging your customers at least N100 for every withdrawal/deposit of N10,000. This means that any withdrawal/deposit less than or equal to N10,000 would be charged at N100, while withdrawals/deposits from N11,000 to N20,000 would be charged at N200.
Then let’s assume that in your location, customers are able to make a total transaction amount of at least up to N700,000 in a day.
This would give you N700,000 ÷ N10,000 = 70 transactions (You charge N100 for transactions of every N10,000, and there are 70 N10,000 in N700,000)
So, 70 × 100 = N7000 in a day, and in a month, it would amount to (N7000 × 30) = N210,000 in a month.
This doesn’t mean you won’t be making transactions higher than this; if you are in a good location, I am sure that you would be realizing more than what we just analyzed.
Not only this, there are still some other services that customers would also demand within the same day, through which you can also be making your money.
Conclusion
To start a POS business, all you may need are a shop/umbrella, a table, a chair, a POS machine, and enough cash for transactions. Your daily profit depends on the number of transactions you make in a day; the more transactions you make in a day, the more profit you make. In this, if you really want to make a good profit in the business, then you may need to get a good location where there is high demand for POS transactions.
Featured image by: Freepik
