The Hidden Downsides of Moniepoint POS: A Critical Look at Nigeria’s Popular Payment Platform

Moniepoint has rapidly become a major player in Nigeria’s financial technology sector, attracting businesses with its promise of smooth and cost-effective Point of Sale (POS) solutions.

While it has undeniably changed the way businesses handle transactions, it’s important to look beyond the surface and consider some potential drawbacks.

This blog post aims to provide a balanced perspective by exploring the less-discussed aspects of Moniepoint POS, shedding light on its disadvantages for those considering this popular payment platform.

Moniepoint POS: A Quick Overview

Moniepoint POS, operated by Moniepoint Microfinance Bank Limited, is a financial service platform designed to simplify payment processing for businesses in Nigeria.

It enables users to perform various financial transactions, such as withdrawals, deposits, transfers, and bill payments, addressing the needs of businesses in a predominantly cash-based economy.  

The platform is known for its user-friendly interface, fast transaction speeds, and excellent customer service compared to other POS providers.

Moniepoint offers two main POS terminal options:  

• Smart POS: Designed for medium to large businesses with high transaction volumes. It features a simple operating system, an easy user interface, a long-lasting battery, and an in-built printer .  
• Mini POS (mPOS): Suitable for small to medium businesses. It is compatible with all cards and enables POS transfers .  

Moniepoint also offers cashback rewards to business owners. You can get up to ₦20 cashback on withdrawals and ₦5 cashback on transfers .  

Disadvantages of Moniepoint POS

While Moniepoint POS has many advantages, it’s essential to be aware of its potential downsides.

These drawbacks, which are not always highlighted, can significantly impact businesses, especially those with specific operational needs or those who prioritize certain aspects of their POS system.

1. Potential for Account Restrictions

One major concern with Moniepoint POS is the possibility of account restrictions, often implemented as a Post No Debit (PND).

A PND effectively freezes your account, preventing any outgoing transactions. This can be triggered by various factors:  

• Scheme Rule Violation: This includes any activity that violates Moniepoint’s policies or those of regulatory bodies like the Central Bank of Nigeria, such as providing incorrect KYC details or engaging in suspected money laundering.  
• Stolen Phone or Terminal: If your phone or POS terminal is lost or stolen, Moniepoint may issue a PND to protect your funds from unauthorized access.  
• Suspicious Transactions: Unusual or large transactions, particularly those involving cryptocurrency, can raise red flags and trigger a PND for further investigation.  
• Technical Issues: Even technical glitches or inconsistencies detected by the system can lead to a PND, requiring you to provide documentation and cooperate with Moniepoint’s investigation.  

While these restrictions are meant to protect users and maintain the platform’s integrity, they can be disruptive for businesses, especially those that rely heavily on the smooth flow of funds.

Yes, Moniepoint’s system for flagging suspicious activity can be quite sensitive, potentially disrupting legitimate business operations.  

2. Minimum Transaction Requirements and Potential Repossession

Moniepoint encourages business growth by requiring a minimum of ₦80,000 in daily transactions.

If your POS consistently fails to meet this target, it is considered underperforming, and you risk having it repossessed.

This requirement may pose a challenge for smaller businesses or those with fluctuating sales volumes.  

3. Erroneous Transfers and Disputes

Erroneous transfers, where funds are sent or received by mistake, are another challenge for Moniepoint POS users.

These errors can occur due to various reasons:  

• Unauthorized access: A friend or someone else could gain access to your account and send money without your permission.  
• Business gone bad: You could send money to someone under deceptive circumstances, such as a non-existent online vendor or an outright fraudster.  
• Fraudulent senders: Someone might claim a legitimate transaction was made in error.  
• Technical glitches: Customers could be debited twice for the same transaction.  
• Subscription blues: You might forget to cancel a subscription and get hit with an unexpected debit.  
• Currency fluctuations: This could cause you to send the wrong amount when transferring money internationally.  

Resolving such disputes can be time-consuming and frustrating, potentially affecting your business operations and customer relationships.

While Moniepoint has procedures to address these issues, the process may involve providing extensive documentation and navigating bureaucratic hurdles.

4. Dependence on Internet Connectivity

Like many modern POS systems, Moniepoint relies on a stable internet connection for optimal performance.

This dependence can be a significant disadvantage in areas with unreliable internet service, potentially leading to:  

• Transaction failures: Interrupted transactions due to connectivity issues can frustrate customers and disrupt sales.
• Limited access to features: Offline functionality may be restricted, hindering access to real-time data, inventory management, and other features.
• Downtime and delays: System outages or slow internet speeds can cause delays in processing payments and accessing account information.

This reliance on internet connectivity can be particularly problematic for businesses in remote areas or those with limited access to reliable internet service.

Get this though, web-based POS systems like Moniepoint can be less convenient than software-based systems due to their reliance on internet connectivity and potential security risks.  

5. Security Concerns

While Moniepoint emphasizes security and uses encryption to protect user data, no system is completely immune to breaches. Potential security risks associated with Moniepoint POS include:  

• Phishing attacks: Employees falling victim to phishing scams can compromise system security and expose sensitive data.
• Data breaches: Despite encryption, data breaches can occur, potentially exposing customer information and financial details.
• Unauthorized access: Weak passwords or inadequate security measures can make accounts vulnerable to unauthorized access.

Businesses using Moniepoint POS must remain vigilant about security protocols, train employees to identify and avoid threats and ensure robust password protection to mitigate these risks.

6. Cost Considerations

While Moniepoint POS is generally considered affordable, be aware of the potential costs associated with POS systems in general. These costs can vary widely based on your industry and specific needs. Some factors to consider include:  

• POS hardware costs: This includes essential items like card readers, receipt printers, barcode scanners, and tablets or touchscreen monitors.
• POS software costs: Some POS software comes with a one-time purchase fee, while others operate on a subscription model with monthly or annual fees.
• Installation costs: Installing the POS hardware and software can incur additional expenses.

7. Technical Challenges and Limitations

Moniepoint faced various challenges while developing its POS transfer feature, which could potentially affect users. These challenges include:  

• Transaction limits: There were initial limitations on the volume of transactions users could conduct with their cards.
• Reversal issues: Reversing POS transfers, especially to certain banks, posed difficulties.
• Technical complexities: Developing a system that allowed each terminal to have its own account number while managing notifications and retrievals presented technical hurdles.

These challenges highlight the potential for limitations and technical issues that users might encounter while using Moniepoint POS.

User Reviews and Testimonials

Moniepoint has received positive feedback for its ease of use in everyday transactions like money transfers, bill payments, and airtime top-ups.

Users appreciate the convenience and time-saving benefits of the platform, as well as the cashback rewards and transaction discounts offered.

The user-friendly interface of the app is also frequently praised.  

However, some users have reported issues with customer support, particularly in terms of responsiveness and helpfulness when encountering challenges.  

Moniepoint Alternatives

Given these potential drawbacks, it’s worth exploring alternative POS solutions available in the Nigerian market. Some notable competitors include:

• Opay POS: Offers a wider range of POS terminal options, including Mini POS, Android POS, and traditional POS, with varying features and price points . Opay also integrates financial services like savings, loans, and insurance, providing a more comprehensive platform.  
• Other Competitors: Several other players in the Nigerian fintech space offer POS solutions, including those listed by CB Insights and Craft.co . These include FairMoney, PalmPay, OurPass, TechFusion, Flutterwave, Wallets Africa, PayQuid, Paystack, and Rex Africa. Each platform has its strengths and weaknesses, and businesses should carefully evaluate their specific needs and priorities before making a decision.  

Customer Support and Service

Moniepoint offers customer support through various channels, including phone, email, in-app support, and a help center.

Users can access support resources and FAQs on their website and contact their support team for assistance with issues like account management, payments, POS terminals, and disputes.

While Moniepoint aims to offer reliable customer service, the effectiveness and responsiveness of their support may vary based on individual experiences and the complexity of the issue.  

Final Thoughts

Moniepoint POS offers a convenient and affordable solution for businesses looking to adopt digital payments in Nigeria.

However, it’s crucial to weigh its potential disadvantages against its benefits.

While Moniepoint offers convenience and affordability, businesses should carefully consider the potential for account restrictions, internet dependency, and limited hardware options before committing to this platform.

Factors such as the possibility of account restrictions due to Moniepoint’s sensitive system for flagging suspicious activity, the reliance on internet connectivity in areas with unreliable service, and the potential challenges with erroneous transfers and disputes should be taken into account.

Read also:

• Disadvantages of OPay POS
• Moniepoint vs Palmpay: Which One Is Best?