5 Steps To Profit From POS Business In Nigeria

As earlier stated here, the POS business thrives more in rural areas or semi-urban centers; in places where there are no banks, or few ATMs to serve the people. 

Hence, if you intend to venture into this business, the first thing is to be sure that the number of banks in your location cannot serve the community. This way, you are guaranteed of making profit. 

In this post, I highlighted 5 step by step plan on how to start and run a profitable POS business and importantly the basic things required to get you started.

Step 1: Have An Existing Business

The POS business has to do with finance and must, therefore, be approached carefully. Besides, the Central Bank of Nigeria is very particular about the business entities that qualify to be agents. So, extra care is taken by commercial banks before they authorize an agent for their retail banking. 

To be eligible, you must have an existing business in operation at least for a period of 12 months. Also, you must have a shop or office from which you operate. Then, you must have been registered with the Corporate Affairs Commission as any of the following entities;

Limited Liability Company

Sole Proprietorship

Partnership

Cooperative Societies

Public Entities

Trusts or any other entity aside faith-based or NGOs. As long as you have any of the above requirement, doing a POS business or serving as a bank agent is possible.

Step 2: Approach A Bank

Virtually all Nigerian banks allow agent banking services. So, as soon as you decide on the bank of your choice, the next thing is to approach the bank and get the details of their requirement. The CBN guide allows being an agent for as many banks as you can serve. 

You will need to fill some documents/agreement forms on the transaction conditions. Then, the bank reviews the application in line with CBN, internal criteria, and enters into an agreement with you, if you meet all criteria. 

Also, you must have an account for a direct deposit for the purpose of the business and provide some documents as part of the requirements for the proposal.  

Some of the required documents include;Valid means of identification e.g Driver’s license, National ID card, International passport or voter’s card.

BVN

2 passport photographs

2 current account references

Evidence of business registration (CAC Certificate) (NOT COMPULSORY)

Tax Identification Number (TIN) (NOT COMPULSORY)

Memorandum and Article of Association. (NOT COMPULSORY)

Credit Bureau Report (NOT COMPULSORY)

A minimum working capital of N50,000 or more. ( COMPULSORY)

Step 3: Get The Equipment

Once your application to the bank has been considered, the bank then supplies the needed tools and equipment for the business. 

Aside from the mobile phone, the following materials are usually supplied by the bank: Point of Sale Terminal; a portable device that facilitates payments of goods and services at bank agent locations using payment cards.

Card reader

Barcode scanner to scan bills for bill payment transactions

Personal identification number (PIN) etc.

Step 4: Location

For you to thrive in the business, it’s advisable to choose a location with limited banks or places with few ATMs. Also, choose strategic locations like the bus stop, public market, event centers, etc. 

All of these factors will have much effect on your daily profit. Once you have a good location, either construct a shed or shop but create enough spaces for swift movement for you and the customers. 

Have a banner displayed at the entrance to show the retail banking services you offer. Then, for security measures, you can have a special purse/pouch around your neck or a safe with a strong lock to prevent theft and burglary. 

Also, if you notice that an ATM is not dispensing cash, you can go there to advertise your service. Some people there in need of cash might subscribe to your service.

Step 5: Render Services

The business is rendered through the use of POS terminals, card readers, mobile phones, and bank linked mobile wallets for real-time transaction processing. 

As soon as you have these, the next step is to start providing the following services;

Cash deposit and withdrawal

Balance inquiry

Funds transfer services (local money value transfer)

Bill payment (taxes, utilities, tenement rates, subscriptions, e.t.c).

Generation and issuance of mini statement.

Cash disbursement and cash repayment of loans.

Agent mobile payments/banking services. 

Wishing you success in all your endeavors. Stay safe.