Mobile Money Agent in Nigeria

When it became imperative to adopt a mobile model to drive financial inclusion in Nigeria, the Federal Government derived two models for the implementation of Mobile Money Operations in Nigeria- bank led and Non bank- led (agency banking). Both of these models involve the use of strategically positioned agents to provide essential banking services to users.

It became widely adopted that by 2019, there were over 15 million mobile money accounts in Nigeria — customers who heavily relied on mobile money operators for their banking needs. As adoption continues to rise, more and more people are exploring ways to benefit from the trend by offering agency banking services as a side or major source of income. In this article, we discuss everything about mobile money agents, who they are, what they do, why they are important, and how to become a mobile money agent.

In this blog post, we'll discuss:

  • Who is a Mobile money agent?
  • Advantages of Mobile Money Agents
  • How Feasible is Mobile Money Business
  • Ways To Make Money Money As A Mobile Money Agent
  • Becoming a Mobile Money Agent
  • How To Choose a Location For Your Business
  • Agent Banking Service Provider
  • Documents Required To Register With Mobile Money Operator

Who is a Mobile Money Agent?

A mobile money agent is essentially your first point of call for banking services such as cash withdrawal, cash deposit, utility bill payments, airtime recharge, and even account creation.

In many areas, particularly in rural regions, it is faster to find a mobile money agent, than it is to find an automated teller machine (ATM), or even a bank branch. These agents, as their name suggests, are highly mobile because they only need one major tool to perform all their transactions: a Point of Sale (POS) machine. Because of their tool of trade, they are often referred to as POS agents.

Benefits of Mobile Money Agents

This business continues to thrive in developing and under-developed countries because they provide essential financial services to the larger population. Some of the advantages of POS agents include being able to help their clients:

  • Skip the bank queues
  • Avoid the transport fare
  • Save time
  • Stay safe by avoiding crowds

How Feasible is Mobile Money Business?

According to a survey carried out by CGAP on mobile money business profitability, which involved over 20 senior managers from some of the major mobile network operators in over 15 markets. 64 percent of the respondents launched mobile money in the past year and 70 percent claim to have already reached over half-a-million customers each with transfers or bill payments or both.

So, besides the advantages mobile money agents provide to the masses, the POS agents make money from the business.

Ways To Make Money As A Mobile Money Agent

1. Commissions: Mobile money agents earn commissions depending on the volume of transactions they make which varies but it’s typically between 0.5% of all the Cash In(CI) and 1% of all Cash Out(CO) transactions that happen during the calendar month.

2. Service Charge: POS agents also charge a service fee for every transaction performed.

Becoming A Mobile Money Agent

There are a couple factors to put into consideration when getting started with POS business. Some of them are discussed below.

How To Choose a Location for Your Business

You would have to set up a shop to operate from. In a lot of cases, POS agents are existing owners of other businesses like small kiosks, tailoring services, etc and already have a point of operation. However, if you are not in this category and have to venue hunt, two things to keep in mind are:

  1. Traffic: The cheese is in rural and semi-urban areas where there are so few ATM machines that the few that exist are always a distance away and over-crowded. Your potential clients would be happy to skip the queue and save on the transport fare as long as you are located somewhere visible enough for them to find you. Our experts suggest high-traffic areas like bus stops and marketplaces.
  2. Security: The nature of the business alone requires you to handle huge amounts of cash on a daily business. Not only do you want to make sure that your investment is safe, you also don’t want the fear of being robbed after a withdrawal to deter your clients from coming to you. Avoid regions that are notoriously known for high crime rates or frequent inter-cult fight breakouts.

Choosing A Mobile Money Operator

You would need to select a Mobile Money Operator (MMO) to power the services you intend to provide. Many Commercial Banks, Microfinance Banks, and Agency Networks have been licensed by the Central Bank of Nigeria to provide Mobile Money Operations services via independent agents. These MMOs offer various mobile agents compensation schemes and service delivery platforms. While some commercial banks might issue you a POS device without upfront cost if you meet certain terms and conditions like minimum customer base, minimum monthly transactions, etc, others might require that you pay an upfront fee. We spoke to some of the experts on the Moni Africa POS agents network on what to look out for when choosing an MMO and they had this to share;

1. Network: The commission may be very attractive but you won’t earn much if consistent network issues chase your customers away. Before you decide to go with any mobile money agency, do a lot of research. Find out from people within the region which platforms they currently run on, and how frequently they experience downtime. You want to avoid issues where you’re unable to confirm a transaction for hours because there’s no network.

2. Customer Service: How accessible are the support team when you need to reach them in cases of urgency? How quickly are disputes resolved? In cases where a transaction fails, would you need to visit their office daily for a month before a reversal is processed, or is it instantly done? This is important because even though the fault is not yours, your clients will hold you responsible for their experience, not them. So ensure you have done enough research to make you comfortable with your choice.

3. Incentives: You are in the business for money. Compare the commissions and charges offered by the options you have listed out and go with the one that offers you the most value.

Some of the leading MMOs worth checking out include FirstMonie, Opay, Paga, Monniepoint, and Kudi.

Documents Required To Register With A Mobile Money Operator — Completing Onboarding

You’ve got a venue. You’ve decided on a Mobile Money Operator. All you need now is to complete the onboarding process and you’ll start earning. Although requirements may slightly differ, we’ve rounded up a list of frequently required documentation to help you prepare:

  1. Valid means of Identification: National ID card, International passport, Driver’s license.
  2. Bank Verification Number
  3. An active account with the bank or agency of your choice
  4. Business Registration documents from Corporate Affairs Commission
  5. Contact Details: address, email, phone numbers
  6. References

Now that you have a complete checklist on how to get started as a mobile money agent in Nigeria, you are ready to take the next step to have a successful POS agent business. In our subsequent post, we will discuss how you can access cash floats to expand your POS business.

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