Top 7 Disadvantages or Problems of POS Business on Nigeria
Posted in: POS Guides

Top 7 Disadvantages or Problems of POS Business on Nigeria

Since 2013, when the Point of Sale (POS) machine was introduced in Nigeria, the POS business has continued to thrive and has been revolutionizing the way financial transactions are done in Nigeria. The introduction of a cashless policy has also helped the business gain more ground in the Nigerian financial sector. 

Each business has its disadvantages and the POS business is not an exception. As the POS business continues to expand in Nigeria, there’s an urgent need to identify its challenges to enable beginners who want to start the business to be proactive in tackling the challenges that are associated with the POS business. To this end, we shall be enumerating the disadvantages of POS businesses in Nigeria in the subsequent section.

Disadvantages Of POS Business

Top 7 Disadvantages or Problems of POS Business on Nigeria

There are many disadvantages accruing from doing POS business in Nigeria; they include:

1. Poor Internet Connection

One of the major challenges facing POS businesses in Nigeria is network issues. This problem is more prevalent in rural areas where there is no network mask to provide an internet connection. This network issue is really frustrating for the POS business because, in some cases, you may wish to make withdrawals from the POS machine using your debit card but the transaction won’t be successful because of a poor internet connection. 

2. Fraud Issue

The POS business has continued to witness fraud cases. A friend of mine who is a POS agent lost ₦100,000 to a fraudster. The scammer posed as a genuine customer and met my friend in his POS stand and transferred the sum of ₦100,000 to him but my friend didn’t know that it was a fake alert and he gave him the ₦100,000 before he realized that it was a fake alert. The customer had left. These are just a few of the fraud issues that POS businesses encounter on a daily basis in Nigeria.

3. Robbery Attack

In the recent past, many POS operators have witnessed robbery attacks. On several occasions, we have heard news where hoodlums attack POS operators and steal their money. Some of these hoodlums attack POS agents with guns and matchets and collect the POS machine from them. And the unfortunate thing is that anyone can be the victim of robbery attackers, irrespective of the POS stand.

4. Delay In Reversal Of Funds

Sequel to the network issue we discussed earlier, there may be cases where a POS agent may want to transfer funds to a different financial institution but the transaction may not be successful due to the network issue or other challenges. Instead of the fund being reversed within a short time, it will be delayed for days and sometimes even weeks, leaving the POS operator stranded. 

5. Viruses And Malware

Some POS machines, if used for a long time, may develop faults due to malware installation into the terminal. If the POS operator is not well experienced, the agent may continue to use it without knowing, which may lead to faulty transactions, and in some instances, it may be to the detriment of the POS agent.

6. POS Machine Is Cost

Another problem that is facing POS businesses in Nigeria is that the POS terminal is relatively expensive to buy. Some advanced POS machines cost up to ₦100,000 and if you don’t want to buy the terminal and wish to rent it, you will be required to pay a caution fee that may range from ₦10,000 to ₦50,000. Hence, some beginners who wish to start the business may find it very difficult to get the POS machine because of its expensive nature.

7. Power Failure

Incessant power failure is also another challenge facing the POS business in Nigeria. Some POS operators don’t have access to regular power supplies, which hinders the success of the business since electricity is needed to charge the POS machine. Most of the POS agents in rural areas find it very difficult to charge their POS terminal because there is no electricity to power it. When this happens, the business will be crippled, which will definitely lead to untold hardship for the POS owner.


While POS businesses have brought numerous benefits to the Nigerian economy and POS agents, they also face notable problems or disadvantages. Power failure, robbery attacks, network issues, and the cost of POS machines are some of the key problems facing POS businesses in Nigeria. Hence, POS owners and intending POS agents are advised to be aware of these challenges and strategize accordingly to overcome them. 

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