How to Start a POS Business in Africa: A Complete Guide

By Joshua Oluwafemi – Financial Consultant & Startup Strategist

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🧭 Introduction

Point of Sale (POS) businesses have grown into one of the most popular micro-enterprise opportunities across Africa. With the need for quick cash withdrawals, mobile transfers, and utility payments in underserved areas, POS agents now fill a vital gap in financial inclusion.

According to recent reports, the number of POS agents in Nigeria, for instance, surpassed 1.8 million as of early 2025, with thousands more joining monthly.

So, how do you successfully launch and run a POS business in Africa? This guide breaks it down step by step.

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💼 What Is a POS Business?

A POS (Point of Sale) business involves offering financial services such as:

• Cash withdrawals
• Deposits and fund transfers
• Airtime and data sales
• Bill payments (electricity, cable TV, water, etc.)
• BVN enrollment (in some cases)

As an agent, you earn a commission for every transaction you perform. The business is low-barrier, scalable, and provides daily income—which makes it very attractive for young entrepreneurs and retirees alike.

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✅ Step-by-Step Guide to Starting Your POS Business

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1. 📊 Conduct Market Research

Before you invest, assess your environment:

• Is the area crowded or underserved with POS operators?
• Are there banks or ATMs nearby?
• What’s the average daily foot traffic?
• What services do people need most (e.g., withdrawals vs bill payments)?

💡 Tip: Areas with limited banking infrastructure (rural or semi-urban) are most profitable.

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2. 📝 Register Your Business (Optional but Recommended)

To build trust and possibly scale:

• Register with your country’s corporate affairs body (e.g., CAC in Nigeria).
• Open a business account for settlements.
• Get a Tax Identification Number (TIN) if needed.

Helps when applying to bigger fintech companies or banks for support.

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3. 🏦 Choose Your POS Service Provider

There are two main types:

A. Banks (Access Bank, First Bank, UBA, Zenith, etc.)

• Offer free terminals (in some cases)
• Lower transaction fees
• Higher documentation requirements
• Slower onboarding

B. Fintech Companies (Opay, Moniepoint, Palmpay, Kudi, Baxi, etc.)

• Fast setup
• Mobile-friendly agent apps
• More flexible pricing
• Easy to get terminals (with deposit or target-based loans)

⚖️ Compare based on: uptime, agent support, ease of use, commissions, and terminal quality.

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4. 💳 Acquire a POS Terminal

You can:

• Buy a terminal (₦20,000 – ₦100,000 or equivalent)
• Lease or get it free with a deposit/target requirement
• Use Android POS (more features) or Mini POS (more portable)

Be sure to test before accepting delivery.

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5. 🏪 Choose a Strategic Location

Ideal spots include:

• Market entrances
• Bus stops
• School gates
• Residential areas with poor banking access
• Busy roadside kiosks

If you don’t have a shop:

• Set up a small kiosk or umbrella stand
• Partner with an existing shop for space

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6. 💸 Fund Your Agent Wallet

You need working capital of ₦50,000 – ₦500,000+ depending on:

• Expected daily cash demand
• Your agreement with the provider (some preload terminals)
• Number of services offered

💡 Start small and grow your float as demand increases.

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7. 🤝 Provide Excellent Customer Service

Trust is everything.

• Dress well, be polite, be honest
• Give receipts for all transactions
• Have a signboard with your name and charges
• Offer value-added services (e.g. quick recharge, bill payment)
• Handle customer complaints quickly

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8. 📈 Keep Proper Records

Track:

• Daily sales & commissions
• Cash flow (how much you withdraw and deposit)
• Terminal charges or downtime issues
• Customer complaints

Use simple tools like Excel, Google Sheets, or POS apps with dashboards.

🚫 Common Mistakes to Avoid

• Not confirming transaction success before handing out cash
• Using unreliable POS terminals
• Ignoring network or power backup (e.g. no power bank)
• Charging customers too high – they’ll run
• Operating in an already saturated area

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🧠 Bonus Tips

• Run promotions (₦20 discount for frequent users)
• Partner with local shops or pharmacies
• Offer delivery cash-out (mobile withdrawal service)
• Get multiple terminals for backup
• Expand into mobile money or insurance if your provider allows

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📝 Final Summary

Starting a POS business in Africa is a practical and scalable opportunity for anyone seeking a reliable daily income. With low startup costs, growing financial needs, and government support for financial inclusion, the potential is huge.

Just focus on:

• Choosing the right location and provider
• Offering honest, fast, and friendly service
• Maintaining a reliable float and network
• Scaling smartly as your customer base grows

With the right approach, you could move from a roadside kiosk to managing a POS agent network across multiple locations in 6–12 months.