The value of transactions over Point of Sales (PoS) terminals in Nigeria surged to N18 trillion in 2024, hitting an all-time yearly record.
This is according to data obtained from the Nigeria Inter-Bank Settlement System (NIBSS).
Fuelled by a protracted scarcity of cash at ATMs and the aggressive push in PoS deployments by fintech companies, the 2024 record represents a 69% increase when compared with the value of PoS transactions in 2023 at N10.7 trillion.
In the same vein, the volume of transactions rose by 8% year-on-year to 1.5 billion in 2024 compared with the 1.4 billion recorded in the previous year.
While commercial banks had been the major drivers of PoS terminal availability in the past, the entrance of fintechs into this space has seen the number of PoS devices in the market grow astronomically.
Industry analysts believe there are several factors contributing to the increasing adoption of POS as a means of transaction by Nigerians.
Chief among these is the difficulty in accessing cash through the usual banking channels.
Long queues and wait times, along with intermittent unavailability of cash in the ATM machines have frustrated patrons, leading to POS payments becoming increasingly attractive.
“The rapid growth of POS is not just an avenue for payment but also withdrawals have filled a gap for many Nigerians who struggle to access cash through banking channels such as ATM or teller withdrawals.
“It has also helped in bringing the banking services closer to the rural areas, which do not have as many banks accessible to them,” said A Lagos-based financial analyst, Mr. Adewale Adeoye.
While the initial motivation for PoS business was the lack of bank ATMs in some areas, this has shifted to the lack of cash in ATMs and the need to make cash available to Nigerians.
It is now a common place to see PoS agents directly opposite a bank ATM or beside it as an alternative for bank customers whenever the ATMs refuse to dispense cash.
For a fintech like PalmPay, the deployment of PoS through agents was part of the company’s strategic plans to drive financial inclusion in Nigeria.
“This mission has fueled our efforts in deploying more PoS terminals across the 774 local government areas in the country,” the Head of Marketing and Communications at PalmPay, Femi Hanson, told Naijaonpoint.
Highlighting the impacts of PoS business on the country, Hanson noted that aside from driving financial inclusion, the growing transactions on the platform are also boosting revenue for the Government through the Electonic Money Transfer Levy (EMTL) being charged on transactions from N10,000 and above.
“We have numerous stories of individuals and families that have benefited from the PoS business through the income made from charges on transactions.
“We have numerous stories of individuals and families that have benefited from the PoS business through the income made from charges on transactions.
“In addition, PoS operators are providing convenience for Nigerians. We saw this during the 2023 cash crunch and even till the present time. More people rely on PoS agents to get cash or even carry out basic transactions,” he said.
Despite their strategic role in the payment ecosystem, many Nigerians are concerned about charges being imposed by PoS operators across the country.
Naijaonpoint earlier reported that electronic payment transactions in Nigeria rose to N1.07 quadrillion in 2024, reaching an all-time high and the first time to hit the quadrillion mark.