mPOS adoption may hit 46 per cent by 2017

Although its deployment is still adjudged to be very low in Nigeria, adoption of Mobile Point of Sales (mPOS) terminal is expected to see a 46 per cent penetration by 2017.

This was revealed by experts, who gathered at this year’s Ennovators Breakfast Series (EBS) to discuss the future of mPOS in Lagos. Though, they are bitter about the snail speed development that has greeted its adoption in the country, they are however optimistic about its growth.

Already, the Nigeria Interbank Settlement Service (NIBSS) has certified 14 mPOS providers; the deployment is abysmally low with just about 2,000 terminals in circulation.

According to the experts, only by exchange of innovative ideas and exposition of business opportunities that banks, ISOs and merchants can understand that mPOS is a veritable tool for last mile banking in Nigeria.

In the communiqué issued at the end of the meeting and signed by the Event Director, EBS, Sola Fanawopo, mPOS enables a whole new market sector to offer card and mobile payments: sole traders and micro merchants and this includes taxi drivers, hairdressers, plumbers and salespeople.

According to it, traditional POS technology did not address this sector because of the significant costs involved in purchasing the terminals. As a result, these merchants relied on cash and cheque payments.

However, it revealed that mPOS shipments are expected to keep growing at a CAGR of 40 per cent between 2013 and 2018 with an estimated 52.1 million units to be shipped worldwide in 2018, adding that these figures are not based on micro merchants only as studies revealed that a significant proportion of mPOS shipment growth will be driven by merchants bolting its solutions onto their existing POS infrastructures.

Some of the resolutions reached at the conclusion of the deliberations include that the mPOS business in Nigeria represent the best opportunity for the financial services industry to correct all the mistakes made with the operations of the PoS scheme as the flagship of the Cashless Nigeria project championed by Central Bank of Nigeria (CBN); that the Payment Facilitator (PF) that is the mPOS certified service providers should regularly meet with the regulator and NIBSS, the mPOS aggregators to address all issues that may inhibit the successful implementation of the scheme across the country.

According to the meeting, collaborative approach should be explored to deepen the adoption mPOS in the country, PF should work with Financial Institution, which are the merchant acquirer to extend the acquirer’s capabilities in a number of areas, all under the brand name of the PF.

“The PF plays several critical roles, including market development, merchant of record, risk underwriting, and management. The FI earns revenue through incremental purchase volumes generated by the partnership while the PF owns the customer relationship, providing processing services for its own merchants. The MNOs possess large customer bases. Acquirers can partner with MNOs to support MPOS acceptance by MNO customers, providing incremental revenue for both acquirers and MNOs. This additional service will enable the MNO to deepen customer relationships, thereby reducing churn rates