By Martin Ekpeke
Tope Dare, a financial expert and ATM salesman, has pointed to several factors explaining the rising popularity of Point-of-Sale (POS) terminals over Automated Teller Machines (ATMs) in Nigeria.
He highlighted the stark difference in deployment numbers: as of March 2024, Nigeria had approximately 2.7 million POS terminals compared to fewer than 21,500 ATMs, demonstrating a clear preference for POS services.
Dare in his recent article titled ‘The Battle for Cash: ATMs vs. POS Operators’, explained that the ATM network faces significant challenges, including low withdrawal limits (often ₦5,000–₦10,000 per transaction, forcing multiple withdrawals), frequent cash shortages, and long queues due to limited functioning machines per bank branch.
He also pointed out the disparity in withdrawal limits, with corporate account holders, including POS operators, having access to up to ₦500,000 daily, while regular customers face much stricter limitations. This imbalance, he argues, fuels frustration among everyday Nigerians who rely on ATMs for cash access.
Despite the growing use of digital payment platforms, cash remains essential to Nigeria’s economy, with many relying on it for daily transactions. This necessitates a balanced approach to financial inclusion, raising crucial questions about the role of POS services: Are they truly increasing financial inclusion, or are they exploiting customers with high fees?
How can ATMs be protected from being drained by POS agents to ensure better service for regular users? And what policies can create a financial system that is accessible, affordable, and fair for all? These are the questions.