PoS transactions climbed to N18trn in 2024 – NIBBS

Point of Sales (PoS) transactions in Nigeria skyrocketed to a record N18 trillion in 2024, marking a 69% increase from the N10.7 trillion recorded in 2023. This surge was largely driven by a prolonged cash scarcity at ATMs, which made PoS payments more attractive.

Additionally, fintech companies played a significant role in expanding PoS terminal deployments, with the number of terminals more than doubling to 5.5 million in 2024.

The volume of PoS transactions also saw an 8% year-on-year rise to 1.5 billion.

However, this growth has raised concerns about increased transaction charges, with fees for withdrawing N5,000 rising to as high as N500 in some areas.

This shift towards cashless payments reflects a growing trend in Nigeria, where electronic payment channels are becoming increasingly popular. In fact, cashless transactions in Nigeria rose to N237 trillion in the first quarter of 2024, an 88% increase from the previous year.

Financial analysts have emphasized multiple reasons behind the increasing reliance on Point of Sales (PoS) transactions in Nigeria which reached an unprecedented N18 trillion in 2024 according to data from the Nigeria Inter-Bank Settlement System (NIBSS).

Additionally, the volume of transactions saw an 8 per cent year-on-year increase, climbing to 1.5 billion transactions in 2024 from 1.4 billion in 2023.

While commercial banks previously dominated the PoS sector, the influx of fintech companies has drastically transformed the market.

Furthermore, registered PoS terminals skyrocketed from 3.5 million in December 2023 to 7.8 million in December 2024, highlighting the registration of an additional 4.3 million PoS machines. However, a gap remains, with over 2 million registered devices yet to be deployed.

“The rapid growth of PoS is not just about payments; withdrawals have become essential for many Nigerians who struggle to access cash through ATMs or bank tellers,” said Adewale Adeoye, a Lagos-based financial analyst.

“It has also expanded banking services to rural areas where financial institutions have limited physical presence.”

The demand for PoS transactions has evolved over time. Initially, the business thrived due to a lack of ATMs in some areas, but the ongoing scarcity of cash in ATMs has further reinforced its necessity.

It is now commonplace to find PoS agents stationed directly outside bank branches, offering an alternative for customers unable to withdraw cash from malfunctioning or cash-strapped ATMs.

Fintech firms have played a pivotal role in the massive deployment of PoS devices, aiming to bridge financial service gaps in Nigeria. According to PalmPay’s Head of Marketing and Communications, Femi Hanson, the company has onboarded over 700,000 agents across Nigeria, actively working to expand its PoS network in all 774 local government areas.

Similarly, Moniepoint, another leading fintech, disclosed that it has deployed over 800,000 PoS machines and is planning to introduce an innovative all-in-one PoS system that integrates payment processing, inventory management, and transaction reconciliation.

Another major player, OPay, reported that its PoS agent network has grown to over 500,000 across the country, solidifying its position in the digital payment space.

Despite their convenience, PoS transactions have come under scrutiny due to rising service charges. With limited cash availability at bank ATMs, many Nigerians are left with no choice but to rely on PoS agents, who have increased their transaction fees significantly.

In Lagos, for instance, withdrawing N5,000 via PoS now attracts charges as high as N500—a steep rise compared to the N100 to N200 fees seen a few months ago. Higher withdrawal amounts incur even steeper charges, making PoS transactions increasingly costly for consumers.

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