Student Business: How Much Do You Need To Start A POS Business In Nigeria; I recently started a POS business, while I am not a student (anymore) my routine and career evolve around them hence I have learned a few things from how much it costs to start a POS business in Nigeria as a student, if its a good student business idea in the first place, and how much money comes in and out.
Student Business: How Much Do You Need To Start A POS Business In Nigeria
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How POS Business Works In Simple Terms
POS business aims to do one thing, which is save your customers the stress of going to bank ATMs to withdraw cash and for Nigerians, avoid losing their cards to ATM machines. In the past, I used to say a prayer every time I needed to use a bank ATM because the chances of losing my ATM card and money were higher due to network issues. However, with the availability of POS agents and machines, the risks associated with using an ATM have been significantly reduced.
While the POS machine can’t ”swallow” your cards, if the network is horrible like some banks we can’t mention, you might come across a failed transaction.
To simplify how POS business works, I’ll make a list below.
- POS agent has the machine and a decent amount of cash
- Customers come and request to withdraw from said POS agent using their ATM cards/transfer
- The POS agent charges the customer and adds what is called withdrawal charges per 1,000
- The customer receives their money and bids goodbye to the POS agent
How Much Does It Cost To Start A POS Business
Small scale? I’ll recommend N60,000, this should cover buying a POS machine as providers like Palmpay & Opay have POS machines starting from N10,000.
Don’t forget, you can’t put all the balance you have after buying the machine as ”cash at hand” you have to split it into two halves, one half goes for POS cash in hand, and the other hand stays in the POS bank account in case customers want to make transfers.
That being said, with a few extra thousands, you can buy a table, chair, and banner frame(I use Palmpay and it came with a banner), so give or take with N100,000 – N150,000 you can buy every basic thing you need to start a POS business in Nigeria as a student.
Is The POS Business The Right One For You As A Nigerian Student
That’s a question only you can answer, but I’ll give you a few pieces of advice, the first being ”It’s not as easy as it is on paper”
To begin with, having a good location can be very beneficial for your business. Additionally, ensure that your lecture timetable allows you to open in the evenings, starting at least from 3 p.m. I have observed that during this time, there is usually a high volume of foot traffic from people returning home and needing to withdraw cash for dinner.
It’s important to consider the location of your POS spot. Having it too far from the bank can be inconvenient for you, even if your customers won’t be needing their banks due to your services.
You might still need to withdraw cash, especially if your business is thriving and you’re dealing with a lot of transactions. Therefore, it’s recommended to choose a location that is easily accessible and convenient for your needs.
How much money can students make from the POS business?
There are so many factors that determine your POS business ROI, I’ll make another list below for you to understand properly.
- Location: The busier the location, the higher your traffic, so bus tops, neighbourhoods, besides booming businesses will do you so much good.
- Capital: The higher your capital the less time you spend transporting to go to the bank
- Time: If time permits you to be available mornings and evenings, that’s extra bucks for you.
Regarding the question about the potential earnings from a POS business, it largely depends on the location of your business. For busy locations, the earnings can range from N3,000 to N5,000 daily, excluding service charges. Whereas, for less busy locations, the earnings can range from N500 to N1,500 daily, excluding service charges. It’s important to keep in mind that the location is a crucial factor in determining the profitability of a POS business.
Please note, these figures are purely from my own experience and dependent on if you charge customers using this pattern
- N1,000 – N5,000 (N100)
- N6,000 – N10,000 (N200)
- N11,000 – N15,000 (N300)
FAQs On How To Start A POS Business In Nigeria As A Student
Q; Which POS provider is the best?
A: I decided to give Opay a try since they had the lowest-priced machine. However, it turned out to be a frustrating experience as I had to wait for 2 weeks before receiving my machine. At that point, I requested a refund and decided to try Palmpay instead. They promptly assigned an agent to assist me, and I was able to get my machine within just 3 days.
Q: What challenges should I look out for?
A: First will be finding a location, less competition will also help, and most importantly, consider your security, you’ll be handling cash a lot, so late nights without proper security isn’t a good idea
Q: Which company is best for POS?
A: There are so many services offering POS machines, Opay, Palmpay, Moniepoint, etc, but I personally use Palmpay
Q: Can I start the POS business with N50,000?
A: Yes, but an extra N10,000 would do you better
Conclusion
Do you want to start a POS business in Nigeria as a student? be my guest, I’m envisaging the only challenge the business might have in the coming future I will be overcrowding, but if you know your onions, you’ll still have your customers.
