The Fintech Revolution: Mobile Money, POS Business, and You

During the 2023 cash crunch, while traditional banking apps crashed, OPay, PalmPay, and Moniepoint kept working. This cemented their place in Nigeria's economy. These "Neobanks" have no physical branches but offer speed and reliability that old banks struggle to match.

Traditional Banks (GTB, Zenith, FirstBank):

• Pros: Trust, corporate banking, international trade, physical branches for complaints.
• Cons: Slower apps, network downtime, paperwork.

Fintechs (Kuda, OPay, PalmPay):

• Pros: Blazing fast transfers, zero fees (sometimes), instant account opening.
• Cons: No branches (customer support is online only), perception of being "less secure" (though they are licensed by CBN).

Agency Banking (POS) is a huge employer in Nigeria.

How to Start:

• Get a Terminal: Register with Moniepoint, OPay, or Baxi. The device usually costs ₦20,000 - ₦40,000 (or is free with a caution fee).
• Location: Find a spot with high foot traffic but few ATMs (markets, bus stops).
• Capital: You need cash on hand (float) to pay customers who want to withdraw. Start with ₦50,000 - ₦100,000.
• Profit: You earn from charges on withdrawals and transfers.

To prevent fraud, CBN has tiered KYC (Know Your Customer) limits.

• Tier 1: Open with just a phone number and passport photo. Limit: ₦50,000 balance, ₦300,000 cumulative transaction.
• Tier 2: Requires BVN. Higher limits.
• Tier 3: Requires BVN, ID card, and utility bill. Unlimited balance, up to ₦5m transaction limit (varies by bank).

Warning: If you run a business on a Tier 1 account, your account will be blocked once you hit the limit! Upgrade immediately.

Fintechs also revolutionized credit. You can get a loan in 5 minutes without collateral.

How they decide: They scan your phone's SMS data (transaction alerts) to estimate your income and spending habits.
Tip: Always repay on time. They report to the Credit Bureau (CRC/FirstCentral), and defaulting will ruin your chances of getting a mortgage or car loan later.

The future is cashless. With the e-Naira and growing card adoption, carrying cash will become less common. Learning to use digital tools now puts you ahead of the curve.