Value of PoS Transactions down to N46Bn in January

MERCHANTS across the country recorded transactions through point of sale (PoS) terminals worth N46 billion in some 3.6 million number of transactions in January this year.The figure achieved compared to N53 billion in December 2015.

Analysts said that the December figure was high because of the festive period when people made lots of purchases.Also the number of PoS terminals deployed by merchants have not increased for the past one year.

Christabel Onyejekwe, executive director, Business Development, Nigeria InterBank Settlement System (NIBSS) in a presentation at Remittance conference, has affected value and volume of transactions at PoS terminals.

“There is dilemma in the deployment of PoS terminal in that space, which has remained at 62, 000 for the past one year because of high exchange rate of the naira to the dollar which makes the cost of a terminal high to go for as much as N80, 000 per terminal” she added.

Reacting to this development, Tunde Ogungbade, managing director, Global Accelerex, said that PoS terminals like other products are manufactured abroad and imported into Nigeria; therefore, cost and price of PoS terminals are subject to the epileptic rise in foreign exchange experience in the last four months.

“In the short run, I do not believe it will have a significant impact on PoS terminal deployment rates. We will continue to see forward-looking banks leveraging PoS terminals and other e-channels to drive down cost and offer innovation to merchants and customers. However, in the long run, this may have an adverse effect on the deployment rate of PoS terminals because these same banks have already been hit by the reduction in revenues due to the policy changes that eliminated COT charges to customers, in spite of the new policy on Current Account maintenance fees. In future earnings reports, cost reduction will be critical to achieving earnings, therefore, banks will be more prudent with costs and investment offers to their investor confident. Return on Invested Capital (ROIC) for PoS terminals will be more scrutinized.”

On how to stimulate cashless initiative this 2016, he said that: “We need to continue the campaign we started with the cashless policy. Discourage deposits of large amounts at banks to drive adoption at the merchant locations and thereby leverage the direct interaction between consumers and merchants for education. When a merchant starts to encourage a consumer to engage electronic channels for commerce, awareness and campaign at the grassroots level has begun”.

Mrs. Regha Onajite, chief executive officer, Electronic Payment Providers Association of Nigeria (EPPAN) said: “the motivation for adoption for consumers is the convenience and security, since there is no compulsion to adopt by the way of penalty. But, hopefully as people begin to align themselves with the benefits of electronic payment we should gradually see a hundred percent increase in the next one year,” she added.