Nigeria: Enhanced SoftPOS Adoption Key to Resolving Funds Transfer Issues – Stakeholders

Stakeholders in the e-commerce sector are advocating for the wider adoption of SoftPOS, a payment system that enables financial transactions without the need for physical machines, highlighting its potential to resolve current financial transfer challenges.

This call was made by a coalition of bankers, fintech companies, and e-commerce platforms during an event titled ‘Accelerating Contactless Adoption: A Collaborative Approach to Overcoming Adoption Barriers,’ held recently in Lagos.

Wole Faroun, the convener of the event and CEO of NetPlusDotCom, emphasized that while SoftPOS has made significant strides in enhancing payment accessibility and convenience, it has yet to achieve widespread adoption. SoftPOS is powered by Near Field Communication (NFC) technology, allowing users to make payments without physical contact.

“SoftPOS technology transforms smartphones into payment terminals, eliminating the need for traditional Point of Sale hardware,” Faroun stated.

As a financial innovation, SoftPOS has been recognized for its potential to revolutionize payment systems. NetPlusDotCom has been at the forefront of this NFC innovation in Nigeria, partnering with major commercial banks such as Providus, Zenith, FCMB, Wema Bank, and First Bank.

Participants at the event identified several challenges hindering the adoption of contactless payment systems, including a lack of education about the technology, poverty, and the unavailability of internet services in some regions of the country.

Kayode Sangoleye, Group Head of e-business at Providus Bank, highlighted the bank’s development of Providus SoftPOS, which was launched in 2023 in partnership with Mastercard. He noted that the drive for SoftPOS stemmed from the need to find a more profitable business model compared to traditional POS machines, which banks typically provide to merchants for free despite their $100 purchase cost.

Frank Atat, Divisional Head of Payment and Solutions at FCMB, pointed out that the high cost of NFC-enabled smartphones is a significant barrier, as many Nigerians cannot afford these devices.

The stakeholders concluded that there is a critical need for collaboration to develop a more profitable business model for SoftPOS that benefits both commercial banks and digital financial service providers. Enhanced education on SoftPOS technology and improved infrastructure could also play crucial roles in overcoming these adoption barriers, ultimately improving financial transactions and economic activity in Nigeria.