Difference Between Bank POS and Fintech POS Providers in Nigeria

By Paschaline Chisom -

Difference Between Bank POS and Fintech POS Providers in Nigeria


The Point of Sale (POS) business has become one of the fastest-growing sectors in Nigeria’s financial ecosystem. With limited access to bank branches and ATMs in many areas, POS agents now act as mini-banks, helping people withdraw cash, transfer money, pay bills, and carry out everyday financial transactions.

As the POS business continues to grow, many aspiring agents and business owners are often confused about one important question:

Should I choose a bank POS or a fintech POS provider?

Although both bank POS and fintech POS machines perform similar basic functions, there are major differences in how they operate, their charges, speed, flexibility, customer support, and overall business experience.

In this article, we will clearly explain the difference between bank POS and fintech POS providers, their advantages, disadvantages, and which option is best for different types of users in Nigeria.

What Is a Bank POS?

A bank POS is a Point of Sale terminal issued directly by a traditional commercial bank such as Access Bank, First Bank, UBA, GTBank, Zenith Bank, or others.

These POS machines are linked directly to the bank’s infrastructure and settlement system. They are mostly designed for merchants who already have a business account with the bank.

Key Features of Bank POS

Issued by commercial banks

Linked directly to the bank’s system

Usually requires a business or current account

Strict documentation and approval process

Regulated by the Central Bank of Nigeria (CBN)

What Is a Fintech POS?

A fintech POS is a POS machine provided by a financial technology company (fintech) such as Moniepoint, Opay, Palmpay, Kuda, Paga, Paystack, Flutterwave, or other POS aggregators.

Fintech companies leverage technology to make financial services faster, more flexible, and more accessible, especially for small business owners and POS agents.

Key Features of Fintech POS

Issued by fintech companies

Faster onboarding and activation

Often requires minimal documentation

Flexible settlement options

Agent-friendly support system

Major Differences Between Bank POS and Fintech POS Providers

Let’s break down the differences clearly under key categories.

  1. Registration and Onboarding Process

Bank POS Registration

Getting a POS machine from a bank can be stressful and time-consuming. Most banks require:

Business registration documents (CAC)

Utility bill

Valid ID

Business location inspection

Minimum account balance

Long approval timeline

Approval can take weeks or even months.

Fintech POS Registration

Fintech POS providers make registration very easy. In most cases, you only need:

Valid ID

Phone number

Bank account

BVN

Some fintech POS machines are activated within 24–72 hours.

Winner: ✅ Fintech POS

  1. Speed of Transaction and Network Reliability

Bank POS Network

Bank POS machines depend heavily on traditional banking infrastructure. During peak hours, bank POS often experience:

Network failures

Slow transaction processing

Delayed reversals

Fintech POS Network

Fintech POS providers use multiple switching systems and optimized technology, which often results in:

Faster transaction processing

Better uptime

Quick error resolution

However, fintech POS still depend on telecom networks, so occasional issues can occur.

Winner: ✅ Fintech POS (in most cases)

  1. Settlement and Payout Time

Bank POS Settlement

Bank POS settlements are often:

Delayed

Processed at end of business day

Sometimes take 24–48 hours

This can affect cash flow for POS agents who rely on fast turnover.

Fintech POS Settlement

Most fintech POS providers offer:

Instant settlement

Same-day payouts

Wallet-to-bank transfers

This is a major advantage for agents who want quick access to funds.

Winner: ✅ Fintech POS

  1. Transaction Charges and Fees

Bank POS Charges

Bank POS charges are often:

Fixed by the bank

Less flexible

May include hidden fees

Lower margins for agents

Banks prioritize corporate merchants over small POS agents.

Fintech POS Charges

Fintech POS providers offer:

Competitive commission structures

Flexible pricing

Agent-friendly incentives

Performance bonuses

This allows agents to earn more profit.

Winner: ✅ Fintech POS

  1. Customer Support and Issue Resolution

Bank POS Support

Bank customer support is usually:

Slow

Bureaucratic

Requires visiting the bank branch

Limited after-hours support

Reversal issues can take several days.

Fintech POS Support

Fintech companies focus heavily on customer experience. Support is often:

Available via WhatsApp, app, or call

Faster response time

Dedicated agent managers

Quick dispute resolution

Winner: ✅ Fintech POS

  1. Flexibility and Additional Services

Bank POS Services

Bank POS machines are mainly used for:

Card payments

Limited withdrawals

They rarely support additional features.

Fintech POS Services

Fintech POS machines support multiple services such as:

Cash withdrawal

Bank transfer

Airtime and data sales

Bill payments

Account opening

Wallet services

This helps agents earn from multiple income streams.

Winner: ✅ Fintech POS

  1. Risk Management and Security

Bank POS Security

Banks have:

Strong regulatory compliance

High-level fraud monitoring

Strict security protocols

However, their systems are sometimes slow to respond.

Fintech POS Security

Fintech providers use:

Advanced fraud detection

Real-time transaction alerts

App-based controls

Security is strong, but agents must use reputable fintech companies.

Winner: 🤝 Tie (Depends on provider)

  1. Accessibility for Rural and Small Businesses

Bank POS Accessibility

Banks focus more on:

Urban areas

Registered businesses

Large merchants

Rural agents often struggle to qualify.

Fintech POS Accessibility

Fintech companies actively target:

Rural communities

Small traders

Informal businesses

This improves financial inclusion.

Winner: ✅ Fintech POS

Advantages of Bank POS

Strong regulatory backing

Trusted brand name

Suitable for large merchants

Stable for card-only payments

Disadvantages of Bank POS

Slow onboarding

Delayed settlements

Poor agent support

Less profitable for POS agents

Advantages of Fintech POS

Fast registration

Instant settlement

Multiple income streams

Better customer support

Agent-friendly pricing

Disadvantages of Fintech POS

Some providers may be unreliable

Depends heavily on internet and power

Requires careful provider selection

Which Should You Choose: Bank POS or Fintech POS?

Choose a Bank POS if:

You run a large registered business

You focus mainly on card payments

You prefer traditional banking structure

Choose a Fintech POS if:

You are a POS agent

You want fast settlement

You operate a small or medium business

You want higher profit margins

You serve rural or semi-urban communities

Final Thoughts

Both bank POS and fintech POS providers play important roles in Nigeria’s financial ecosystem. However, for most POS agents and small business owners, fintech POS providers offer better flexibility, faster settlement, improved support, and higher earning potential.

As the fintech space continues to evolve, agents are advised to work with reputable, licensed fintech companies to avoid risks and enjoy long-term success.

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