POS Business | How to Earn 6 Figures Monthly

POS business is one of the smartest ways to start making decent amount of money. It is a lucrative business that has been growing in Nigeria. If you want to know how the business works, you’re at the right place.

We all want to earn extra money to cater for our needs. And most people will most likely want to opt in to any available opportunity. POS business has proven to be one of the profitable businesses these days.

You can start offering services like fund transfer and withdrawal, airtime sales, cable subscriptions and other bill payments. However, there’re some things you should know if you want to be doing POS business.

On the off chance that you don’t know how to start the business, this post has got you covered. I’ll guide you through how you can start your own POS business.

Now let’s dive in.

What is POS?

POS (Point of Sale) is a banking device that allows cardholders to make payment for goods and services. It is also known as POP (Point of Purchase). This is because it’s not just a point of sale but also point of customer order.

POS machine performs almost all the functions of an ATM. It helps reduce the stress of keeping cash with you around. Also, it reduces the stress of transacting directly with cash.

sample pos business machine

With POS machine, you can buy goods and pay directly to the account of the seller. Point of sale device can be used to print recharge cards and pay any types of bills.

About POS Business

Commercial banks are continually looking for ways to make their banking service keep thriving. As a result, they adopt the POS business in 2013. This is to make sure that their banking services reach large number of people.

POS business also known as agent banking or bank agent carry out transactions for bank customers. Bank agent allows customers to transfer funds, make deposits, withdraw and check account balance. Also, clients can purchase airtime and pay any type of bills.

how pos business works in nigeria

The bank agent allows customers to make payment in exchange for the provision of services. bank agent usually issues receipt after receiving the payment.

What You Should Know About POS Business

Although, POS business is profitable, there’re some things you should know before starting the business. It’s more profitable in areas where ATMs is not sufficient for the financial needs of the community.

Many people will always need to use banks or ATM for their financial needs. But if there’s no ATM in that area, they’ll have no choice but to look for pos machines. In this case, you should consider that area suitable to start running the business.

I’m not saying you can’t set up a pos business in locations where there are banks and ATMs. But in most cases, ATMs in some locations may not be enough to meet the financial status of the community. As a result, the area should be a suitable one.

Actually, you would have seen many people queue to use ATM. And this is usually because the machine is not sufficient.

If you’ve ever witness the stress of using an ATM, you should know that the business will thrive well in places where banks and ATMs are not enough. In addition, you should set it up in a safe place and always have your pouch with you.

You would have seen people doing pos business with pouch around their body. It’s for security purposes.

Places that are suitable for setting up the business are discussed later in this article.

How to Start a POS Business

If you’ve seen a lot of people doing the pos business and want to start yours, here’s how to start pos business in Nigeria.

Follow the guide below.

1: Get a Location For the POS Business

The first thing you need to do is get a location. The location you choose will play a big role in the business. You have to choose a location that’s easily accessible and where you think it will thrive well.

You may consider the following points to choose the best location for pos business.

  • Places with No Banks and ATMs

As I’ve said earlier, the business will thrive well in areas where there’re no banks and ATMs. And I guess you’ll agree with me that the pos business will attract a lot of people in this area.

Large numbers of people make use of banks and ATMs on daily basis. So, in this case, you might consider choosing a rural area. This is because there are less or no banks in rural areas. And the point of sale machine will relieve people from the stress of carrying cash around.

  • Areas with Shortage of ATMs

Aside from rural areas, you can set up a pos business in areas where ATMs are not enough. People usually queue for a long time to use the ATM in areas where the ATMs aren’t enough.

Some people, however, cannot withstand the stress of waiting for a long time to use the ATMs especially if they’re in a hurry. As a result, they’ll look for pos business owners around without minding the charges.

  • Places close to banks or places with crowd

At times, some ATMs may be having fault or display unpleasant messages like “unable to dispense cash” . If this happens, anyone that needs cash urgently will definitely look for pos business owners around.

Also, you can look for places with crowd. It can be somewhere close to the market or an event center. You just have to know that the more people in that area, the more people will patronize you.

2: Get a Shop to Run the POS Business

Just like most businesses, you need to get a shop for pos business. After choosing a nice location that’s suitable to run the business, the next thing is to get a shop.

You can get a shop of any size to run pos business. Although, a small place is enough, but if you’re going to run any other small business along with it, you’ll need a comfortable shop. This is to permit free movement for you and your customers in the shop.

If you’re asking, can I run a POS business without a shop?

Well, I’ll say yes. If you don’t have a shop or can’t get one at the moment, you can still run the business.

You can build a small shed or partner with shop owners. But you should know that having your own shop will earn you more profit. If you have a shop, people will patronize you and you’ll look reliable.

3: Have a Start-Up Capital

You’ll need capital to start any business. As we all know, some business require high start-up cost while some are not that high. In the case of pos business, you’ll need up to #100,000 to start it.

You should know that people will request for withdrawal than any other transaction. So, you need enough capital to start pos business. The #100,000 is just to start running the pos business. You may need more than #250,000 if you’re going to rent a shop and purchase point of sale machine.

4: Get POS Machine

POS business, as its name implies, requires you to have a pos machine. You can get the device from bank or financial agencies. You’ll have to pay to get the device. However, some banks give free pos machine.

For instance, First Bank, Zenith and UBA may give you for free but you’ll have to meet their requirements.

5: Start Rendering Services

Once you have the machine and other things you need, you should start rendering services. The services you can be providing for customers include;

  • Cash withdrawal and deposits
  • Funds transfer
  • Bill payments
  • Account balance inquiry
  • And others

6: Advertise Your POS Business to Attract Customers

You’ll have to advertise your business. This does not require too much stress. You can print banners and display it for people to know what your business is all about.

Once people know about your business, they’ll be the one coming to patronize you.

How to Get the Machine for POS Business from Bank

As I’ve said, you can get the pos machine from banks for free to start pos business. All banks in Nigeria allow agent banking services. You can become an agent for as many banks as you want.

What you need to get the pos machine from banks is discussed below.

Have a Business

The CBN requires you to have an existing business before banks qualifies you to be eligible to run a pos business. You should know that pos business has to do with money exchange. And banks should be able to confirm that you’re worth running the business.

Therefore, banks require you to have a business that has been in operation for 12 months. Also, you must have a shop before you can be eligible to be a bank agent.

Go to Bank

If you have an existing business already, the next thing you need to do is go to bank. You can go to any bank of your choice to get their requirements.

Fill in the POS Form

Once you get to bank. You’ll have to fill the agent form. Just fill in all the required details correctly.

Provide the Required Documents

Some of the documents you need to provide are listed below.

  • Business details
  • ID card
  • Passport photograph
  • Current account
  • Business registration certificate
  • Start-UP capital of #50,000

Wait for the Bank to Review Your Application

You’ll have to wait for the bank to review your application. Once the bank approves you, the machine will be available within few days. Also, they’ll give you card reader, bar-code scanner and your pin.

How to purchase the Machine For POS Business

If you don’t want to collect pos machine from bank, you can get it from companies that are licensed to sell pos machine.

You can get the pos from Jumia and register with the bank of your choice. Also, you can get it from Paga. And their requirements are similar to what banks require from you.

You may be asking, why do I need to pay for POS if I can get if free from bank? Well, there are more benefits of getting your own point of sale machine than getting it from bank. Some of the benefits are discussed below.

Why You Should Purchase Your Own Machine For POS Business

Banks will gives you the machine for free to start pos business, though. However, you should know that it’s not completely free.

Bank will make money by charging you a fixed commission for each transaction you made via pos. in addition; you must meet some targets before they approve you to become an agent.

For instance, you may have to prove that you can make more than #50,000 transactions each day. Also, you’ll have to pay for agent registration fee before bank gives you the device. The reg fee is usually around #15,000.

If you buy your own pos machine, you won’t have to pay bank commission. Also, you won’t need to meet certain requirements. In addition, you won’t have to pay for any reg fee other than pay to get the device.

Having your own point of sale device gives you more freedom. Moreover, having your own pos let you run your pos business without smart phone and independently.

You will earn from the commission you charge from your clients. Also, you’ll earn from airtime recharge and bill payments.

about pos business plan in nigeria

The registration fee and all other cost to get the machine from bank is almost enough to add money to get your own and start the business.

In addition, if you have your own pos machine, you can always decide how and when to run the pos business. Everything will be under your control.

How Much Does POS Machine Cost?

The cost of buying a point of sale machine varies depending on the type you want. In the same vein, it depends on the agency you want to get it from. The machine cost around #50,000 to #100,000.

On the off chance that you’re curious on which pos machine you should buy, I’ll advice you to buy the one you can afford. However, you should know that the higher the cost the better the device.

Good pos machine usually cost around #70,000 and above. So It’s up to you to decide which one to purchase to start your pos business.

How Profitable is POS Business

Millions of people are using banks and ATMs for transaction on daily basis. And recharge charge is one of the most used products. This means that the demand for the service is high. As a result, pos business has proven to be one of the lucrative businesses that you should consider.

It has proven to be a business that can help you make decent money. And one of the good things about this business is that it requires less capital.

Honestly, pos business has been helping thousands of people to make a living. And you can also consider diving into the business.

If you have the start-up capital ready, you can set up pos business within few days. You just have to implement a good marketing plan and trust me, the business will thrive.

Tips to Make Money Running POS Business

POS business, while it’s lucrative, is a bit tricky. It’s important to know how to succeed running the pos business. Some of the tips to make more money with pos business are discussed below.

Don’t charge too much for the service

You should not charge your clients too much especially if you’re not the only one in that area.

If you’ve used point of sale to perform transaction before, you should know that pos business owners don’t charge more than 2%. For instance, you can charge around 200 for #10,000 withdrawals.

Even if you’re the only one in that area, you shouldn’t charge more than that. If you’re collecting too much charge from your clients, it will scare people away.

Go to faulty ATM machines

At times, some ATMs may not dispense cash. If you notice that some ATMs cannot dispense cash at the moment, you can go there.

Some people might be in a hurry to use cash. And if the machine cannot dispense cash at the moment, they’ll have no other choice but to patronize you.

The Good Things about POS Business

POS business has provided job opportunities for entrepreneurs. It has been helping many people financially. In fact, people are making a living doing pos business.

Bank agent can now make a decent amount of money via bank commissions and charges from customers. Also, it has make banking convenient for customers.

POS business has been helping customers in rural communities to make quick transaction without traveling to long distance.

Likewise, pos business has been helping bank to extend their banking services to wider range for customers.

POS business is a win-win for banks, customers and bank agent.

Final Words About POS Business

POS business is a business you can venture into and start making a decent amount of money. You could be making around #100,000 monthly with point of sale business.

It does not require too much stress. And one of the good things about pos business is that you can set it up in few days. However, you need enough working capital to start pos business because it deals with exchange of money.

You should set up the business in a safe place for security purpose. And also, you might want to set a limit to the amount you’re collecting from your clients. In addition, you should not handle too much money unless there is tight security in your area.

If you’ve been looking for ways to make a decent amount of money, this is an opportunity for you.

I hope you found this post about pos business helpful.

If you need to ask a question, make use of the comment section below.

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This Post Has 5 Comments

  1. DAVID

    THANK you for this article, it’s very encouraging. I want to start a pos business but don’t know how to go about. This article has done justice to that. Thanks again.
    But I want to know this: if I should buy my own POS machine, how do I register with banks? Or can I just start the business with my normal bank account?
    Please, I will be grateful if you reply me sooner.
    THANKS again

    1. Victor Odediran

      @David. If you’ve purchased a POS machine, then take it to the bank you want to partner with for configuration.

  2. Joseph

    Thanks for this educative article. Please, can only one pos machine be used by anyone who wants to be an agent for more than one bank? Thanks.

    1. Victor Odediran

      @joseph. You can become an agent for more than one bank if you purchased the POS machine. However, if you get the POS from bank, you’ll be an agent only for that bank.

  3. Oluwaseun

    Nice write up. Kudos

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