PoS agents who spoke to BrandSpur banking and finance news desk attributed rising PoS withdrawal charges to greater costs and cash scarcity.
In most regions of Nigeria, PoS agents have supplanted automated teller machines (ATMs) as a crucial component of the country’s financial inclusion movement. But there have been expenses associated with that change.
Previously, withdrawals of ₦5,000 and less were subject to a cost of ₦100, while withdrawals of ₦5,000 but less than ₦10,000 were subject to a fee of ₦200. These fees temporarily increased during the cash shortage brought on by the CBN’s currency reform project. Withdrawals of ₦5,000 or less now cost between ₦150 and ₦200, while withdrawals between ₦5,000 and ₦10,000 are regularly taxed at ₦200. This is in contrast to the rates that have stabilized at higher levels over the last month.
After the implementation of the electronic money transfer levy, Nathaniel, a PoS operator in Enugu, revealed that he raised withdrawal fees in December 2024.
According to him: “I increased it because of the charges that PoS people increased because, for each transaction that is above ₦10,000, they usually collect ₦50. For example, if I get a transfer of ₦10,000 to my PoS, they’ll subtract ₦50 from that money. For me to compensate for that, I have to increase my own, too,” he said, adding that the choice was made on his own.
Agents disclosed that, in addition to the levy, they have had difficulty obtaining funds from banks, which has compelled them to purchase funds from people and companies. The final consumer then bears the price of obtaining the money.
According to another POS operator, Favour: “If you go to the bank, they don’t normally give big money. They’ll just give you ₦10,000, and it’s not enough.”
Consumers have, predictably, taken offence at these hikes; the agents report that the majority of consumers have voiced their dissatisfaction.
Another POS agent in Lagos, Ifeoluwa, said, “People are complaining, but they are still coming because they don’t have any other option. When I increased my charges from ₦200 to ₦300 for ₦10,000, people were complaining. But they still prefer to use here than to go to banks.” However, her luck has not been shared by all agents.
Blessing disclosed that since the hike, she has observed a decline in patronage, as consumers are now using transfers instead of cash withdrawals from PoS terminals.
Following the levy’s implementation, a rise in withdrawal fees was unavoidable, according to Oluwagunwa Ibirogba, Chairman of the Lagos Chapter of the Association of Mobile Money & Bank Agents of Nigeria (AMBANN). However, he pointed out that the group is hoping to bargain for a reduced price, which might persuade agents to drop the withdrawal fees.
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The withdrawal fees for amounts under ₦10,000 have also gone up, even though the charge only applies to transactions beyond that amount. Although the group encourages members to maintain fees within certain bounds, Ibirogba acknowledges that it might be challenging to ensure compliance. He added that the group is also attempting to lower the number of cash sales situations. He says that the cost of doing business in Nigeria has gone up recently, prompting many agents to evaluate rates upward, even if he acknowledges that some agents may raise costs unfairly.
He went on to say: “Cost of living has increased. The cost of procurement of other things that surround agency banking has also increased. You have dispense papers that come with the terminals; you have space; you have logistics; you have electricity where need be. So all these costs have to be taken care of.”
While PoS agents have been instrumental in bridging the gap between formal banking services and underserved communities, the rising cost of cash withdrawals has drawn significant criticism. For many Nigerians, the high fees undermine the very purpose of these services, leading to growing calls for the Central Bank of Nigeria (CBN) to regulate withdrawal charges.
However, the solution goes beyond regulation. Ensuring consistent cash availability is crucial, as agents often resort to increasing fees when forced to buy cash. Yet, this presents a dilemma: increasing cash availability may conflict with Nigeria’s broader goal of encouraging digital financial transactions.
Ultimately, the future of Nigeria’s PoS ecosystem will depend on striking the right balance between these competing priorities — making cash accessible while simultaneously fostering a seamless transition to digital payments. How policymakers navigate this challenge will shape the sustainability and inclusivity of the country’s financial services landscape.
