Point of sales (POS) is rapidly growing and paving its way not only across the ancient city of Kano but also the whole country at large. As the country battles with the high rate of unemployment where Nigerians especially youths are taking a drive into the trade of POS agency banking. According to a report by National Bureau of Statistics (NBS) in March 2021, Nigeria’s unemployment rate rose to 33.3% in the fourth quarter of 2020, rising from 27.1% in the second quarter (June) of last year.

Undeniably, POS has introduced Nigerians to the financial technology sector known as agency banking to become more advanced and serve as a means for others to earn a living. The number of agency banking and POS operators has been increasing drastically since 2017 data has shown the gains accrued to those behind the initiatives.
According to 2019 National Financial Inclusion Strategy (NFIS) document released by the Central Bank of Nigeria (CBN), banking agents rose from 38,416 in December 2018 to 236,940 as at December 2019. It is understood that Banks have been operating in an arm length level where people walk into the bank to carry out their various transactional activities but with the current advancement in technology, banks are out to reach their potential customers with the aid of POS agents.

Daniel Agwo, POS agent supervisor of First City Monument Bank (FCMB), explained that point of sales falls under agency banking which is a third party to the system. Technically; the ideal behind the emergence of POS is financial inclusion. The World Bank defines “financial inclusion as individual and businesses having access to useful and affordable financial products and services such as payment, savings, credit and insurance, delivered responsibly and sustainably.” According to the Central Bank of Nigeria (CBN), Nigeria has gained 64% financial inclusion in 2022 and now targets 95% in 2024. The gradual rise in the financial inclusion rate has been significantly impacted by the proliferated deployment of digital financial services (DFS) in the country.

Financial inclusion can be therefore, said to be a strategy whereby an adult Nigerian have easy access to a wide range of formal financial services that meet their needs conveniently and are provided at an affordable cost without them going to the physical structure; Bank.
The sole aim is to bring people most especially from the north to part take in financial transactions for every adult Nigerian to have an account of their own as it was discovered that those residing in the rural areas feel insecure to disclose their financial information and are intimidated by bank officials due to language barrier, they were categorized into unbanked(people who don’t have an account) and under bank (those that have inactive accounts) this issue gave rise to the existence of POS agents who are mostly said to be merchants within various communities that are serving as kinsmen to the people in order to address their financial needs and services with ease as it is more convenient for them as well as easy to seek for their advice in money related decisions.

Mr. Daniel, also commended on how the POS business has been a prosperous one for both Nigerians and the bank establishments entailing many advantages as its importance can be classified into three sides; to the customers, agents, and the bank, on the side of the customers it reduces cost of transport (easy accessibility is provided ), boost their confidence and trust to converse with these agents because of the social values been shared while for the agents it is an opportunity to earn a living out of it; source of empowerment, he also added that “We have a colleague, who is also an agent and the establishment supports him as well as promote his business so it’s an additional revenue to him.

Our branch agents stands to get numerous benefits, If he withdraws from N1, 000 to N5, 000 the bank charges only N20 while he gains N80, its more profitable in the village where he charges N50 Per N1, 000 for commission and withdrawal from N6, 000 to N19, 000 our bank charges the agent 0.4% of the amount which is approximately not up to N80, irrespective of the amount from N20, 000 and above the bank charges N80 flat. If it is transfer from FCMB to FCMB the charge is N20 while for other banks its N30 flat rate. Likewise, the bank pays an agent N250 if he opens an account for a customer, issues card to them and they successfully credit the account, last month September the bank did a promotion where N500 per account was given to agents.” he said.

He added that “POS banking agency increases the customer base and capital base of the bank for instance, if the bank is said to open account for 50 persons in metropolitan areas, the turnout would differ from that of the rural areas and villages where likely 100 accounts can be opened through agents, just like the recent SPW empowerment by the Minister of State, Labour and Employment, Festus Keyamo where N30,000 was paid to 1,000 people each across the 44LGAs in Kano for 3 months, I was in charge of Rogo LGA for this particular project, our branch generated a huge revenue which ordinarily they wouldn’t have. It is safe to say it has promoted the bank’s networking to a greater height”

Like a coin, everything that comes with advantage bounds to have a disadvantage. despite, the multitude advantages that came with the advent of POS there are challenges that swings along According to Mr. Daniel Agwo, dispense error has been an issue of concern in agency banking; it is a withdrawal situation where the transaction indicates “disapproved or failed”. The POS agents is not supposed to pay the customer but rather the customer is expected to lodge a complaint to their bank after 24hours where they would be given a dispense error form to fill and wait. usually the duration for reversal known as TAT (Turn Around Time) doesn’t exceed 24hours depending on the workability of the problem and how stable the network is which might sometimes take as long as 3days before resolving.
Again he added that “Fraud is another striking challenge the bank establishments face in relations to the POS business. People tend to capitalize on the dispense error to defraud POS agents leaving them with no other options than to bear the loss. Sometimes, these fraudsters even get to the extent of lodging a complaint to their various bank knowing fully that the transaction made was successful. When such cases are being reported, we instantly reach out to our agent via email for confirmation. If we do not get any response from the agent within 24 hours, we debit the agent and credit the complainer. We are currently working to ensure that the bank calls or sends SMS to the agent instead of email because at times the agents will end up being debited twice.”

Ahmad Nuhu, Kano based business owner, said “POS business is flexible in nature as it is easy to manage because I get notified for every transaction made by my sales men which doesn’t warrant me to be physically present. I make an average of N8,000 daily as profit. Even though, some issues might arise that would demand for my presence. I can vividly recall a particular incident of a customer who was debited but the receipt came out disapproved, I had to leave my house and drive down to the bank with the said customer to lodge a complaint. After a number of follow ups for the issue to be addressed, it turned out to be unresolved which eventually caused me the loss of N5,000.”

A POS operator at Goron Dutse, Kano, Haruna Inuwa, said I make about N2, 000 to N5, 000 daily and about N70, 0000 monthly on an average. I also sell soft drinks and food items, in additional to the deposits and withdrawals via the POS.” He added, “I can’t thank the Almighty enough for His endless blessing upon me, this business has not only enabled me to fence my family but also to help my relatives and friends.”
POS operator and fabric seller in Sabon gari market Kano, Mrs. Adebayo known as mama Yemi said “I operate and manage the business all by myself as due to the last experience I encountered, two of my attendants have been extorting me off daily gains. As you know this business deals with bulk cash which is a reason why one needs to be extra careful because anything money related comes with a lot of insecurity and trust issues especially with the economic situation we are facing right now.”
POS user, Maryam Bashir, an under graduate student of Bayero university Kano, (Department of computer science) said, “POS is a very good technology to have exist because life is made easy for students living in the campus. They are opportune to get easy access to their money in times of emergency unlike before where bank and ATM are the only options available. Now, within our comfort zone we can make instant transactions at a fair rate, it a ton of blessing to us because personally, my brothers own a POS outlet in our area, it is indeed a fast growing business across the country.”

Similarly another POS user Alhaji Ubaidu in Kwari market, said “I became more motivated to use the agency banking (POS) after an occurrence of fire outbreak within the market. Various shops got affected including one of my shops where I usually keep my money in a safe box. At the time, I lost over a million naira to the fire outbreak because I found it inconvenient to go to the bank and deposit my money but with the coming of POS all these was made convenient and safer because I get to deposit my daily earnings even before closing.”

POS user, Kamal Ahmad narrated his experience , “I received an emergency call where I hasten to withdraw some cash from my Access Bank via POS machine but a dispense error occurred after which I was debited, the agent refused to give me the cash which resulted into a dispute between the POS agent and I. After few days the money was reversed, I would like to draw the attention of banks to improve on their service providers to prevent such instances from frequent reoccurrence” he said.
Change is constant as every day stands as an opportunity to create and recreate something extraordinary because the world is evolving; the agency banking is the one out the steps of technological advancement. It is crawling its way to the Nigerian financial sector.

“The solution to all these concerns is technology. Though it is a growing process and subsequently, everything I have said is based on experience, we usually have virtual meetings with our head office and other branches across the states to come up with Possible solutions to resolve these key areas of concerns, feedbacks from the field are highly evaluated, engaging in roundtable discussions between the bank official, management and the IT personnel that designed our banking app in order to tackle fraud and improve security measures sometimes through the use of OTP (Onetime password) technique to safeguard individual accounts.” Mr. Agwo (FCMB) said.
He furthermore, advised all POS agents to be extra careful in their dealings as well as to keep record of every transactions they make. “All receipts generated from the machine is said to have a “STAN NUMBER” that serves a reference in case a problem occurs.” Mr Agwo said. Lastly, he emphasized that people should abstain from any fraud activity.

Nigeria is home to the majority of financial technology unicorns on the continent, most of which operate in the payments and saving system, as a gradual process; technology advancements will continue to provide digital platforms for innovative avenue to distribute and access financial services while liberalizing traditional transaction processes.

Aisha Abdu Garba
Department of mass communication
Bayero university Kano

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