Don’t Get Left Behind! Guide for PoS Businesses in Nigeria
May 25, 2024
Don't Get Left Behind! Guide for PoS Businesses in Nigeria
Pos (point of sales) terminals have become an important part of Nigeria’s economy. Monetary transactions: withdrawals, transfers, bill payments, and even airtime recharges have been made easy, and many people no longer go to the bank.
Recently, two key developments have impacted PoS operations: mandatory registration with the Corporate Affairs Commission (CAC) and the introduction of a cybersecurity levy. This blog explores what you need to know about being a PoS business owner in Nigeria.
Are You A Pos Agent? Here’s What To Know
In April 2024, the Corporate Affairs Commission (CAC), in collaboration with the Central Bank of Nigeria (CBN), mandated the registration of all PoS agents (including those of significant fintech companies) by July 7, 2024. The CAC, as the regulatory body responsible for the incorporation, registration, and management of companies in Nigeria, plays a crucial role in ensuring the legitimacy and transparency of PoS operations.
This initiative has some objectives:
- To enhance transparency and accountability within the PoS ecosystem.
- Mitigate fraud risks associated with PoS transactions.
- Promote financial inclusion by ensuring proper PoS agent conduct.
It’s not news that many fraudulent activities and cases have been linked to PoS terminals, which are on the rise. These activities include unauthorized transactions, identity theft, and data breaches, all of which pose significant risks to businesses and customers. The federal government has taken this step to mitigate this rising menace and encourage a fraud-free business environment.
As a PoS agent, when you register with the CAC, you stand to gain the following benefits:
1 Enhanced credibility and trust
2 The CAC and other regulatory bodies are committed to supporting registered PoS agents. They offer various support programs or resources, including training workshops, access to dispute resolution mechanisms, and informative materials on best practices. This support is designed to guide you through the registration process and help you thrive in the evolving PoS landscape.
3 Registration can help formalise your PoS business, making it easier to open a business bank account, obtain credit facilities, or enter into official partnerships
4 Long-term industry stability: The introduction of mandatory registration with the CAC and the cybersecurity levy, while initially challenging, can bring significant benefits to the PoS ecosystem. A well-regulated industry with registered agents instils customer confidence, potentially leading to more business opportunities for agents in the long run.
The impact of the cybersecurity levy on businesses in Nigeria is a complex issue with potential benefits and drawbacks. Here’s a breakdown of the key points:
Potential Negative Impacts:
Increased TransactionCosts: The levy will likely translate to a small fee for each electronic transaction, including PoS transactions. This could:
- Discourage customers from using cashless transactions due to higher costs.
Reduce overall business volume for PoS agents who rely heavily on transaction fees.
Uncertain Cost Structure: The exact impact on transaction costs remains unclear. Businesses need help in accurately predicting and budgeting for the levy.
Potential Administrative Burden: Depending on the implementation process, businesses might face additional administrative burdens associated with reporting and remitting the levy. This could include the need to hire additional staff, invest in new systems, or allocate more time and resources to compliance, all of which could increase operational costs and reduce business efficiency.
Potential Positive Impacts:
Improved Cybersecurity Infrastructure: The levy aims to generate funds for enhancing cybersecurity infrastructure. This could also encourage:
- Stronger national defences against cybercrime.
- Improved detection and prevention capabilities for cyberattacks.Ultimately, a more secure digital environment for businesses conducting online transactions
Increased Customer Confidence: Enhanced cybersecurity could foster greater trust among customers regarding the safety of their financial information when using electronic transactions. This could lead to:
- Increased adoption of
- cashless payments in the long run.
- Potential for businesses to attract new customers who prefer secure transaction methods.
As a PoS Business, here’s how you can cope with these new developments:
Stay informed always. Don’t let anything get past you.
- Register with CAC as soon as possible.
- Monitor updates on the cybersecurity levy and its impact on transaction costs.
- Implement strong cybersecurity practices (e.g., password security transaction verification).
How To Register
The registration process might be evolving, so it’s advisable to check with our experts at BeeBot to help you through the process and the latest guidelines. To register, you will need to provide certain information about your business, such as its name, address, and ownership structure. Once you’ve completed the registration, you will become a CAC-registered PoS agent, which will enhance your credibility and trust in the industry.
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