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Part of the guideOffer pay-later in Nigeria: get paid today, customers pay later
The short answer
Pay-later suits restaurants on larger tickets: group meals, events, catering orders, corporate lunches and meal plans. On a single everyday meal the fee and any fixed charge can take a large share of the profit, so many eateries set a minimum bill. Because food margins are high, the break-even sales lift is lower than in retail, but the option has to be offered where it brings new spending.
Restaurants are an unusual fit for pay-later. Most bills are small, most customers pay in full, and nobody needs credit for a plate of jollof. Yet some of an eatery's most valuable sales are large and planned: the office end-of-year lunch, the naming ceremony tray order, the family's Sunday table. Those are where spreading the cost can win business. This article covers the food trade; the general mechanics are in our guide to offering pay-later in Nigeria.
Where it helps and where it does not
| Occasion | Typical ticket | Fit |
|---|---|---|
| Single meal or takeaway | Small | Poor: the fee and any fixed charge take too much |
| Group or family meal | Medium to large | Good: one person pays for many and is short this week |
| Event catering (weddings, naming ceremonies, birthdays) | Large | Strong: a big, planned outlay that families want to spread |
| Corporate lunches and office catering | Large, recurring | Good, though many firms already pay on invoice |
| Monthly meal plans or canteen subscriptions | Medium, recurring | Good: steady revenue and repeat visits |
| Festive orders (Christmas, Sallah, Easter) | Medium to large | Good: spending peaks when cash is tightest |
The common thread is a bill that is larger than a typical day's spending and is going to happen anyway, just later or smaller if the customer must pay in full now. That is the condition under which research such as the 2025 Berg study found pay-later lifts total sales: it helps customers who want to buy but cannot pay in full today.
Worked example: a catering order and a lunch
Food businesses have higher gross margins than most retailers, because the main direct cost is ingredients. The figures below assume a 60% gross margin and an illustrative 3% merchant fee; your own numbers will differ.
A ₦450,000 event catering order
- Gross profit at 60%: ₦270,000.
- Fee at 3%: ₦13,500.
- Gross profit after the fee: ₦256,500.
- If pay-later wins an order that would otherwise have gone to a competitor or been cut to ₦300,000, the restaurant is between ₦76,500 and ₦256,500 better off.
A ₦6,500 lunch
- Gross profit at 60%: ₦3,900.
- Fee at 3%: ₦195. If the provider also charges a fixed ₦100 per transaction, the total is ₦295, or about 7.6% of the gross profit.
- If the customer would have paid by transfer anyway, that is a pure cost.
On the break-even formula from pay-later merchant fees in Nigeria, a restaurant putting 20% of sales through pay-later at 3% needs only a 1% rise in total sales to cover the fee at a 60% margin. The real risk is not the percentage but small tickets and fixed charges, which is why a minimum bill, such as ₦30,000, is common.
Tax: what the fee is calculated on
Restaurant bills often include tax, and that changes what you pay the provider.
- VAT. The standard rate remains 7.5% under the Nigeria Tax Act 2025, effective 1 January 2026. Businesses with annual turnover of ₦100 million or less and fixed assets of no more than ₦250 million are treated as small and exempt from charging VAT.
- State consumption tax. Lagos levies a 5% consumption tax on restaurants, hotels and event centres under its Hotel Occupancy and Restaurant Consumption Law. It is paid by the customer and collected by the business, which remits it to LIRS by the 20th of the following month. Other states have their own rules.
- The fee base. Ask whether the provider's percentage is charged on the tax-inclusive bill. If it is, you pay a fee on money that belongs to the tax authority. Agree that clearly and record the tax at the full bill amount, not the net settlement.
Running it at the counter
- Decide the minimum bill and which orders qualify, such as catering, events and meal plans.
- Show the option on the menu footer, the catering price list and the order form, in one line.
- For catering, take pay-later at the deposit or full-payment stage, not after the event.
- Let the customer pay on their own phone; staff never handle a customer's PIN.
- Wait for confirmation before releasing the order.
- Agree a cancellation rule for events, and how refunds go back to the provider.
- Track pay-later orders separately and review after 90 days: did catering bookings or group bills grow?
Corporate customers
Offices that order lunches or year-end events often already pay on invoice, 30 days after delivery. For those clients, pay-later from a consumer provider is usually the wrong tool; the person ordering is an employee, and the spend belongs to the company. Keep corporate clients on invoice terms and use pay-later for individuals and families paying from their own pockets.
Fraud on large orders
Large catering orders from first-time customers are an obvious target for fraud: a rushed booking, a request to deliver the same day and a payment that later turns out to be disputed. Confirm the order by phone, keep the customer's confirmation reference, and read which fraud losses the provider carries and which it can pass back to you.
Present it as a choice, not an upsell. Under the FCCPC's 2025 rules credit is opt-in, and a waiter who suggests a table "use your limit" on more dishes is creating a complaint. How to tell customers you offer pay-later has wording that works in a dining room.
Where Pryme fits
Eateries are a participating category for Spaces, Pryme's merchant network for pay-later in Nigeria only. Customers with a Pryme account may be offered a naira spending limit based on how they run their account, and they see and accept the full agreement before using it. The credit is lent to the customer by Solid Allianze Microfinance Bank Ltd, a CBN-licensed microfinance bank; Pryme Financial provides the technology. A Spaces limit can be spent only with businesses that have joined Spaces, Pryme's merchant network, so a customer holding that credit can use it only inside the network. Ask in writing for the merchant fee, any minimum bill, settlement timing, whether the fee is charged on the tax-inclusive bill and how cancelled catering orders are refunded, at support@mypryme.com.
For everyday bills paid in full, Checkout takes bank transfers free of charge. Multi-Account is one way to keep consumption tax and VAT apart from takings until it is due. For the full picture, see the parent guide on getting paid today while customers pay later.
Questions people ask
Can restaurants in Nigeria offer buy now pay later?
Yes, through a lender registered with the FCCPC or licensed by the CBN. It works best on larger bills such as event catering, group meals and meal plans rather than single meals.
Is pay-later worth it for a small eatery?
Only on larger tickets. On a small bill the percentage fee plus any fixed charge can take a noticeable share of the profit. Many eateries set a minimum bill for pay-later.
Is the fee charged on the bill including consumption tax?
It depends on the provider. Ask whether the percentage is applied to the tax-inclusive total, and record the tax at the full bill amount whatever the settlement shows.
Can customers pay for event catering in instalments?
Yes, if your provider supports it. Take the pay-later payment at booking or before the event, and agree the cancellation and refund rule in writing.
Sources
- Berg, Burg, Keil and Puri: The Economics of Buy Now, Pay Later: A Merchant's Perspective (NBER w33152; Journal of Financial Economics, 2025) · accessed Oct 2026
- Techeconomy: LIRS tasks businesses on 5% consumption tax compliance · accessed Oct 2026
- Forvis Mazars: VAT and Nigeria's 2025 tax reforms · accessed Oct 2026
- FCCPC: Digital, Electronic, Online or Non-Traditional Consumer Lending Regulations, 2025 · accessed Oct 2026
- Federal Reserve Bank of Richmond: Buy Now, Pay Later: Market impact and policy considerations (Economic Brief 25-03) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.