sample business plan for banking

Bank Business Plan Template

Written by Dave Lavinsky

Bank Business Plan

Over the past 20+ years, we have helped over 500 entrepreneurs and business owners create business plans to start and grow their banks.

If you’re unfamiliar with creating a bank business plan, you may think creating one will be a time-consuming and frustrating process. For most entrepreneurs it is, but for you, it won’t be since we’re here to help. We have the experience, resources, and knowledge to help you create a great business plan.

In this article, you will learn some background information on why business planning is important. Then, you will learn how to write a bank business plan step-by-step so you can create your plan today.

Download our Ultimate Business Plan Template here >

What Is a Business Plan?

A business plan provides a snapshot of your bank as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategies for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan

If you’re looking to start a bank or grow your existing bank, you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your bank to improve your chances of success. Your bank business plan is a living document that should be updated annually as your company grows and changes.

Sources of Funding for Banks

With regards to funding, the main sources of funding for a bank are personal savings, credit cards, bank loans, and angel investors. When it comes to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to ensure that your financials are reasonable, but they will also want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business. Personal savings and bank loans are the most common funding paths for banks.  

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How to write a business plan for a bank.

If you want to start a bank or expand your current one, you need a business plan. The guide below details the necessary information for how to write each essential component of your bank business plan.

Executive Summary

Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

The goal of your executive summary is to quickly engage the reader. Explain to them the kind of bank you are running and the status. For example, are you a startup, do you have a bank that you would like to grow, or are you operating a chain of banks?

Next, provide an overview of each of the subsequent sections of your plan.

• Give a brief overview of the bank industry.
• Discuss the type of bank you are operating.
• Detail your direct competitors. Give an overview of your target customers.
• Provide a snapshot of your marketing strategy. Identify the key members of your team.
• Offer an overview of your financial plan.

Company Overview

In your company overview, you will detail the type of bank you are operating.

For example, you might specialize in one of the following types of banks:

• Commercial bank : this type of bank tends to concentrate on supporting businesses. Both large corporations and small businesses can turn to commercial banks if they need to open a checking or savings account, borrow money, obtain access to credit or transfer funds to companies in foreign markets.
• Credit union: this type of bank operates much like a traditional bank (issues loans, provides checking and savings accounts, etc.) but banks are for-profit whereas credit unions are not. Credit unions fall under the direction of their own members. They tend to serve people affiliated with a particular group, such as people living in the same area, low-income members of a community or armed service members. They also tend to charge lower fees and offer lower loan rates.
• Retail bank: retail banks can be traditional, brick-and-mortar brands that customers can access in-person, online, or through their mobile phones. They also offer general public financial products and services such as bank accounts, loans, credit cards, and insurance.
• Investment bank: this type of bank manages the trading of stocks, bonds, and other securities between companies and investors. They also advise individuals and corporations who need financial guidance, reorganize companies through mergers and acquisitions, manage investment portfolios or raise money for certain businesses and the federal government.

In addition to explaining the type of bank you will operate, the company overview needs to provide background on the business.

Include answers to questions such as:

• When and why did you start the business?
• What milestones have you achieved to date? Milestones could include the number of clients served, the number of clients with positive reviews, reaching X number of clients served, etc.
• Your legal business Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry or market analysis, you need to provide an overview of the bank industry.

While this may seem unnecessary, it serves multiple purposes.

First, researching the bank industry educates you. It helps you understand the market in which you are operating.

Secondly, market research can improve your marketing strategy, particularly if your analysis identifies market trends.

The third reason is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your bank business plan:

• How big is the bank industry (in dollars)?
• Is the market declining or increasing?
• Who are the key competitors in the market?
• Who are the key suppliers in the market?
• What trends are affecting the industry?
• What is the industry’s growth forecast over the next 5 – 10 years?
• What is the relevant market size? That is, how big is the potential target market for your bank? You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.

Customer Analysis

The customer analysis section of your bank business plan must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: individuals, small businesses, families, and corporations.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of bank you operate. Clearly, corporations would respond to different marketing promotions than individuals, for example.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, including a discussion of the ages, genders, locations, and income levels of the potential customers you seek to serve.

Psychographic profiles explain the wants and needs of your target customers. The more you can recognize and define these needs, the better you will do in attracting and retaining your customers.

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Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other banks.

Indirect competitors are other options that customers have to purchase from that aren’t directly competing with your product or service. This includes trust accounts, investment companies, or the stock market. You need to mention such competition as well.

For each such competitor, provide an overview of their business and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as

• What types of customers do they serve?
• What type of bank are they?
• What is their pricing (premium, low, etc.)?
• What are they good at?
• What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to ask your competitors’ customers what they like most and least about them.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

• Will you provide loans and retirement savings accounts?
• Will you offer products or services that your competition doesn’t?
• Will you provide better customer service?
• Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.  

Marketing Plan

Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For a bank business plan, your marketing strategy should include the following:

Product : In the product section, you should reiterate the type of bank company that you documented in your company overview. Then, detail the specific products or services you will be offering. For example, will you provide savings accounts, auto loans, mortgage loans, or financial advice?

Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your plan, you are presenting the products and/or services you offer and their prices.

Place : Place refers to the site of your bank. Document where your company is situated and mention how the site will impact your success. For example, is your bank located in a busy retail district, a business district, a standalone office, or purely online? Discuss how your site might be the ideal location for your customers.

Promotions : The final part of your bank marketing plan is where you will document how you will drive potential customers to your location(s). The following are some promotional methods you might consider:

• Advertise in local papers, radio stations and/or magazines
• Reach out to websites
• Distribute flyers
• Engage in email marketing
• Advertise on social media platforms
• Improve the SEO (search engine optimization) on your website for targeted keywords

Operations Plan

While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your bank, including reconciling accounts, customer service, accounting, etc.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to sign up your Xth customer, or when you hope to reach $X in revenue. It could also be when you expect to expand your bank to a new city.  

Management Team

To demonstrate your bank’s potential to succeed, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.

Ideally, you and/or your team members have direct experience in managing banks. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act as mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in managing a bank or successfully running a small financial advisory firm.  

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet, and cash flow statements.

Income Statement

An income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenue and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will you see 5 clients per day, and/or offer sign up bonuses? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets

Balance sheets show your assets and liabilities. While balance sheets can include much information, try to simplify them to the key items you need to know about. For instance, if you spend $50,000 on building out your bank, this will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a lender writes you a check for $50,000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement

Your cash flow statement will help determine how much money you need to start or grow your business, and ensure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt.

When creating your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing a bank:

• Cost of furniture and office supplies
• Payroll or salaries paid to staff
• Business insurance
• Other start-up expenses (if you’re a new business) like legal expenses, permits, computer software, and equipment

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your bank location lease or a list of accounts and loans you plan to offer.  

Writing a business plan for your bank is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will understand the bank industry, your competition, and your customers. You will develop a marketing strategy and will understand what it takes to launch and grow a successful bank.  

Bank Business Plan Template FAQs

What is the easiest way to complete my bank business plan.

Growthink's Ultimate Business Plan Template allows you to quickly and easily write your bank business plan.

How Do You Start a Bank Business?

Starting a bank business is easy with these 14 steps:

• Choose the Name for Your Bank Business
• Create Your Bank Business Plan
• Choose the Legal Structure for Your Bank Business
• Secure Startup Funding for Your Bank Business (If Needed)
• Secure a Location for Your Business
• Register Your Bank Business with the IRS
• Open a Business Bank Account
• Get a Business Credit Card
• Get the Required Business Licenses and Permits
• Get Business Insurance for Your Bank Business
• Buy or Lease the Right Bank Business Equipment
• Develop Your Bank Business Marketing Materials
• Purchase and Setup the Software Needed to Run Your Bank Business
• Open for Business

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OR, Let Us Develop Your Plan For You

Since 1999, Growthink has developed business plans for thousands of companies who have gone on to achieve tremendous success.   Click here to see how a Growthink business plan consultant can create your business plan for you.

Other Helpful Business Plan Articles & Templates

How To Write a Business Plan for Bank in 9 Steps: Checklist

By henry sheykin, resources on bank.

• Financial Model
• Business Plan
• Value Proposition
• One-Page Business Plan
• SWOT Analysis
• Business Model
• Marketing Plan

Welcome to our blog post on How To Write a Business Plan for a Bank in 9 Steps. In today's digital age, the banking industry is undergoing a significant transformation with the rise of online banking platforms. According to recent statistics, the global digital banking market is projected to reach $22.3 trillion by 2027, with a CAGR of 8.6% from 2020 to 2027. This exponential growth highlights the immense potential for entrepreneurs and aspiring bankers to establish their own digital banking platform.

When it comes to starting a digital banking platform, having a well-designed business plan is crucial for success. A comprehensive business plan not only serves as a roadmap, but also helps attract potential investors and secure necessary funding. In this article, we will guide you through the essential steps to create a compelling business plan that banks will find irresistible.

Step 1: Conduct market research and analysis

Step 2: Determine the target market and customer profile

Step 3: Identify and analyze potential competitors

Step 4: Perform a feasibility study

Step 5: Define the unique value proposition and competitive advantage

Step 6: Develop a comprehensive financial plan

Step 7: Establish strategic goals and objectives

Step 8: Define the organizational structure and management team

Step 9: Obtain necessary licenses and regulatory approvals

In the upcoming sections, we will delve into each step in detail, providing you with valuable insights and practical tips to successfully navigate the process of writing a business plan for a bank.

Building a digital banking platform that offers convenience, security, and financial literacy can revolutionize the banking industry. So, let's dive into the first step - conducting market research and analysis to lay the foundation for your business plan.

Conduct Market Research And Analysis

Conducting thorough market research and analysis is a crucial step in developing a successful business plan for a digital banking platform. This process allows you to gain a deep understanding of the market landscape, identify potential opportunities and challenges, and make informed decisions when it comes to your target market and customer profile.

• Identify the size and growth potential of the market: Begin by gathering data on the size of the market you intend to enter. This will help you assess the growth potential and determine if it presents a viable opportunity for your digital banking platform.
• Analyze your target market: Dive deeper into your target market by identifying demographic characteristics, such as age, income, and location. Understanding the needs and preferences of your target market is crucial in developing tailored financial products and services.
• Assess market trends and competition: Stay updated on the latest market trends and innovations in the digital banking industry. Analyze your potential competitors to understand their strengths, weaknesses, and market positioning. This will help you identify gaps in the market and differentiate your platform.
• Evaluate customer needs and pain points: Interview potential customers and conduct surveys to gather insights into their financial needs, challenges, and pain points. This information will be invaluable in designing solutions that address their specific requirements.

Tips for Conducting Market Research and Analysis:

• Utilize both primary and secondary research methods to gather comprehensive market data.
• Monitor industry reports, publications, and online resources to stay up-to-date with market trends.
• Consider partnering with market research firms or consultants for a more in-depth analysis.
• Engage with potential customers through focus groups or online communities to gather qualitative insights.
• Regularly review and update your market research to adapt to evolving market dynamics.

By conducting thorough market research and analysis, you will be equipped with valuable information to guide your business decisions and develop a compelling business plan for your digital banking platform.

Determine The Target Market And Customer Profile

Identifying and understanding your target market is crucial for the success of your digital banking platform. It allows you to tailor your products, services, and marketing efforts to meet the specific needs and preferences of your customers. Here are the important steps to determine your target market and customer profile:

• Conduct market research: Start by conducting thorough market research to gather insights and data about the demographics, psychographics, and behavior of potential customers. This will help you understand who your ideal customers are and what they are looking for in a digital banking platform.
• Segmentation: Once you have collected the necessary information, segment your target market based on criteria such as age, income level, location, and financial goals. This will allow you to create targeted marketing campaigns and develop personalized offerings for each segment.
• Identify customer needs: Analyze the pain points and challenges faced by your target market. Identify their financial goals and aspirations, and determine how your platform can address their needs effectively.
• Competitor analysis: Evaluate your competitors' target markets and customer profiles to identify any gaps or opportunities in the market. Differentiate your platform by offering unique features or services that specifically cater to your target market's needs.

Tips for determining the target market and customer profile:

• Use surveys, interviews, and focus groups to gather firsthand feedback from potential customers. This will give you valuable insights into their preferences, pain points, and expectations.
• Stay updated with market trends and changes in customer behavior. Continuously monitor and analyze data to ensure your target market profile remains relevant and accurate.
• Consider utilizing data analytics tools to gain a deeper understanding of your target market. This will help you make data-driven decisions and refine your marketing strategies based on customer preferences.
• Regularly review and adapt your target market and customer profile as your platform grows and evolves. Customer needs and preferences may change over time, and it is crucial to stay agile and proactive in meeting those changes.

Identify And Analyze Potential Competitors

Identifying and analyzing potential competitors is a crucial step in creating a business plan for a bank. This step helps you assess the competitive landscape and understand the strengths and weaknesses of other players in the market. Here are some key considerations:

• Research: Conduct thorough research to identify existing banks and financial institutions offering similar services. Look for both traditional brick-and-mortar banks as well as digital banking platforms.
• Online Presence: Explore their online presence and evaluate their digital banking capabilities. Look for features, functionalities, and user experience that differentiate them.
• Competitive Advantages: Identify the unique selling propositions (USPs) of your competitors. Determine what sets them apart from others in terms of product offerings, customer service, technology, or any other factors.
• Customer Reviews: Analyze customer reviews and feedback on various platforms to gain insights into customer satisfaction and grievances. This will help you identify areas where your competitors excel or fall short.
• Market Share: Determine the market share and customer base of each competitor. This will give you an idea of the scale and reach you need to target.
• Financial Performance: Analyze the financial performance of your competitors by studying their annual reports, financial statements, and any available data. This will help you understand their growth trajectory and potential vulnerabilities.
• Look beyond direct competitors and consider indirect ones, such as fintech start-ups or alternative financial service providers.
• Keep an eye on emerging trends and innovations in the banking industry to stay ahead of your competitors.
• Consider conducting a SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis for each major competitor to gain a deeper understanding of their positioning.

Identifying and analyzing potential competitors is not only about understanding the competition but also about finding opportunities to differentiate your digital banking platform. By studying your competitors, you can identify gaps in the market and develop strategies that align with your unique value proposition.

Perform A Feasibility Study

A feasibility study is a crucial step in the business planning process. It involves conducting a comprehensive analysis to determine the viability of your digital banking platform. This study will help you assess the potential risks and benefits associated with your business idea and make informed decisions.

During the feasibility study, you should analyze various aspects of your business idea, including the market demand, competition, technological requirements, financial projections, and regulatory landscape. Here are the key steps to perform a feasibility study:

• Conduct thorough market research to understand the current demand for digital banking services and identify any gaps in the market.
• Evaluate the potential size of your target market and identify your ideal customer profile to tailor your offerings effectively.
• Assess the competitive landscape by analyzing existing digital banking platforms, their features, pricing strategies, and customer base.
• Consider the technological requirements for establishing and maintaining your online banking platform. Ensure that you have access to reliable and secure infrastructure.
• Develop financial projections and assess the profitability and sustainability of your business model. Consider factors such as revenue streams, operating expenses, and potential return on investment.
• Study the regulatory environment and identify the licenses and approvals required to operate a digital banking platform in your target market.
• Engage with industry experts and seek their advice during the feasibility study to gain valuable insights.
• Consider conducting surveys or focus groups to gather feedback from potential customers and validate your assumptions.
• Regularly review and update your feasibility study as market conditions and industry trends evolve.

By conducting a thorough feasibility study, you will gain a deeper understanding of the viability and potential of your digital banking platform. This study will serve as a foundation for making informed decisions throughout the business planning process.

Define The Unique Value Proposition And Competitive Advantage

Defining the unique value proposition and competitive advantage of your digital banking platform is crucial in order to differentiate yourself from other financial institutions and attract customers. Your value proposition is the core promise you make to customers about the benefits they will receive by using your platform. Your competitive advantage is what sets you apart from competitors and gives you an edge in the market.

• Identify Your Unique Selling Points: Determine what makes your platform unique and why customers should choose it over others. Consider features such as advanced security measures, user-friendly interface, personalized financial advice, or innovative banking solutions. These selling points will help you stand out and provide value that your competitors might not offer.
• Prioritize Customer Needs: Understand your target market's pain points and financial needs. Tailor your offerings and services to address these specific needs. Whether it is offering low-interest rates on loans, providing competitive investment options, or simplifying the account opening process, make sure your value proposition directly addresses the challenges your customers face.
• Analyze Competitors: Study your competitors' value propositions and competitive advantages. Identify the gaps and areas where you can excel. Look for opportunities to offer a better customer experience, more innovative products, or superior customer service. This analysis will allow you to position your platform as a market leader and attract customers seeking a better banking experience.

Tips for Defining Your Value Proposition and Competitive Advantage:

• Emphasize the convenience and accessibility of your digital banking platform.
• Showcase your commitment to security and privacy.
• Highlight any partnerships or collaborations that add value to your platform.
• Demonstrate your expertise in financial education and advisory services.
• Offer unique features such as budgeting tools, financial planning, or rewards programs.

By clearly defining your unique value proposition and competitive advantage, you can effectively market your digital banking platform to potential customers and secure their trust and loyalty. Remember, your value proposition should clearly communicate the benefits customers will gain by choosing your platform and should differentiate you from competitors. Building a strong value proposition will be instrumental in the success of your business plan.

Develop A Comprehensive Financial Plan

Developing a comprehensive financial plan is a crucial step in creating a business plan for a bank. This plan outlines the projected financial performance of your digital banking platform and demonstrates to potential investors and lenders that your business is financially viable.

When developing your financial plan, consider the following:

• Revenue projections: Estimate the revenue your digital banking platform is expected to generate. This can include income from various sources such as transaction fees, interest on loans, and commissions from financial products.
• Expense projections: Forecast the expenses associated with running your platform, including personnel costs, technology infrastructure, marketing expenses, and regulatory compliance costs.
• Capital requirements: Calculate the amount of capital needed to start and operate your digital banking platform. This includes upfront costs such as software development, marketing campaigns, and initial infrastructure investments.
• Profitability analysis: Assess the profitability of your platform by calculating the net income and profit margin. This analysis helps determine the financial feasibility and sustainability of your business.
• Cash flow projections: Forecast the cash flow of your digital banking platform, including the inflows from revenue and investment, as well as the outflows from expenses and loan repayments.
• Funding sources: Identify potential funding sources for your platform, such as bank loans, venture capital investments, or crowdfunding campaigns.
• Research industry benchmarks and financial ratios to ensure your projections are realistic and market-aligned.
• Consider the potential impact of external factors such as economic conditions, regulatory changes, and customer behavior on your financial plan.
• Regularly review and update your financial plan to reflect any changes in your business or market conditions.

By developing a comprehensive financial plan, you can demonstrate to banks and investors that your digital banking platform has a clear pathway to profitability and long-term success.

Establish Strategic Goals And Objectives

Establishing strategic goals and objectives is a crucial step in writing a business plan for a bank. These goals and objectives will serve as a roadmap for your digital banking platform, guiding all your actions and decisions towards a defined direction. It is important to clearly define and articulate these goals and objectives to ensure that everyone in the organization is aligned and working towards a common vision.

When establishing strategic goals and objectives, consider the long-term vision of your digital banking platform . What do you envision your platform to become in the next five or ten years? How do you see it evolving and growing? Define these aspirations into specific goals that are achievable and measurable.

Additionally, it is important to set objectives that are SMART - Specific, Measurable, Achievable, Relevant, and Time-bound. This means that each objective should be clearly defined, quantifiable, realistic, relevant to your business, and have a deadline for completion.

Here are some tips to consider when establishing strategic goals and objectives for your digital banking platform:

• Take into account market trends and customer demands when defining goals and objectives.
• Align your goals and objectives with your unique value proposition and competitive advantage.
• Consider both financial and non-financial objectives, such as customer satisfaction and innovation.
• Involve key stakeholders in the goal-setting process to ensure buy-in and commitment.
• Regularly review and update your goals and objectives to adapt to changes in the market and industry.

By establishing clear strategic goals and objectives, you are providing a direction for your digital banking platform to strive towards. These goals will serve as a compass, guiding your decisions and actions as you work towards success in the competitive banking industry.

Define The Organizational Structure And Management Team

Defining the organizational structure and management team is a crucial step in writing a business plan for a bank. This section outlines the key individuals who will be responsible for managing the operations and achieving the strategic goals of the digital banking platform.

To begin, it is important to clearly outline the various departments and positions within the organization. This includes roles such as CEO, CFO, CTO, and COO, as well as departments like finance, technology, operations, and customer service. Clearly defining these roles and responsibilities helps establish a clear chain of command and ensures that all areas of the business are properly managed.

• Consider including an organizational chart to visually depict the structure of the organization.
• Provide a brief description of each key management team member's background, skills, and experience.
• Highlight any unique qualities or expertise that these individuals bring to the table that make them a valuable asset to the organization.
• Consider including any advisory boards or external consultants that will be involved in decision-making processes.

Furthermore, it is essential to emphasize the qualifications and experience of each member of the management team. This includes their educational background, professional accomplishments, and relevant industry experience. Demonstrating that the team possesses the necessary skills and expertise significantly strengthens the credibility of the business plan and instills confidence in potential investors or lenders.

Lastly, it is important to consider and outline any plans for future expansion or growth. As the digital banking platform evolves, so too may the organizational structure and management team. Clearly articulate the expected growth trajectory and how the team will adapt to the changing needs of the business.

By properly defining the organizational structure and management team, the business plan for a digital banking platform becomes a comprehensive document that demonstrates a solid foundation for success. This section showcases the individuals driving the business forward, while also addressing how the organization will adapt and grow over time.

Obtain Necessary Licenses And Regulatory Approvals

Obtaining the necessary licenses and regulatory approvals is a crucial step in establishing a digital banking platform. Compliance with legal and regulatory requirements ensures that your business operates within the boundaries set by governing authorities. Here are the key steps to take when seeking licenses and approvals:

• Research Licensing Requirements: Begin by researching the specific licenses and permits required for operating a digital banking platform in your jurisdiction. Different countries and regions may have varying regulations, so it is essential to be well-informed. Consult with legal experts or industry professionals to navigate the complexities of licensing.
• Submit Applications: Once you have identified the licenses and permits needed for your digital banking platform, prepare and submit the required applications. Be sure to provide accurate and comprehensive information, as any discrepancies or oversights could lead to delays or rejection of your application.
• Engage with Regulatory Authorities: Throughout the licensing process, it is important to maintain open lines of communication with the relevant regulatory authorities. Address any queries or requests for additional information promptly and transparently. This will help in establishing a positive relationship with the authorities and expediting the approval process.
• Comply with Regulatory Requirements: As you progress towards obtaining licenses and approvals, ensure that your business fully complies with all relevant regulatory requirements. This may include maintaining appropriate capital adequacy ratios, implementing robust anti-money laundering measures, and adhering to data protection and privacy laws.
• Seek Legal Counsel: Working with experienced legal counsel specializing in financial regulations can prove invaluable during this process. They can offer guidance, review your compliance efforts, and help navigate any legal complexities that may arise.
• Stay Updated: Regulatory frameworks and requirements are subject to change, so it is crucial to stay informed about any updates or amendments. Continuously monitor regulatory developments to ensure that your digital banking platform remains compliant.
• Start the licensing process early: Obtaining licenses and regulatory approvals can be a time-consuming process. Starting early allows for any unexpected delays and ensures you meet your desired launch timeline.
• Be thorough and accurate: Pay meticulous attention to detail when completing license applications. Provide all necessary documentation and information to avoid unnecessary delays or complications.
• Engage with industry associations: Connecting with industry associations or peer networks can provide you with valuable insights into navigating the licensing process. Networking with experienced professionals can help you anticipate challenges and streamline the approval process.
• Maintain ongoing compliance: Obtaining licenses and regulatory approvals is just the first step. Develop robust compliance procedures and internal controls to ensure ongoing adherence to regulatory requirements. Regularly review and update your compliance practices as regulations evolve.

In conclusion, writing a business plan for a bank requires careful research, analysis, and strategic thinking. By following the nine steps outlined in this checklist, you can create a comprehensive and compelling plan that demonstrates the viability of your digital banking platform. From conducting market research to obtaining necessary licenses, each step is crucial in building a strong foundation for your business. Remember to highlight your unique value proposition and competitive advantage, develop a comprehensive financial plan, establish strategic goals, and define your organizational structure. With a well-crafted business plan, you can confidently approach banks and secure the funding needed to bring your digital banking platform to life.

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Writing a Bank Business Plan

• Written By Dave Lavinsky

When it comes to seeking funding from a bank or other financial institution, one of the most important things you can do is have a well-written business plan . This document will not only give potential lenders and investors an idea of your company’s current position and future goals but will also provide them with a clear understanding of the risks involved in lending you money or investing in your business.

What is a Business Plan?

A business plan is a document that provides a detailed description of a business, its products or services, its market, and its financial projections. It is used to secure funding from lenders or investors and to provide guidance for the business’s future operations.

Why Write a Business Plan

There are several reasons why you might want to write a plan for your business, even if you’re not looking for funding, they are:

• To clarify your company’s purpose and direction
• To better understand your industry and customers
• To develop a realistic financial plan and accurate projections
• To identify potential risks and opportunities
• To track your company’s progress over time

An effective and well-written plan is helpful for potential investors and clarifies the plans you have for any future business partners.

Sources of Business Funding for Banks

There are many sources of business funding available to banks, including:

• Equity financing: This is when you sell a portion of your business to investors in exchange for capital. This can be a good option if you need a large amount of money quickly, as it doesn’t require you to pay back the funds over time.
• Debt financing: This is when you borrow money from a lender, such as a bank, in exchange for repayment plus interest. This type of financing can be helpful if you need to keep your cash flow low in the early stages of your business.
• Grants: There are several different government and private grants available to businesses, which can often be used for start-up costs or expansion.
• Venture capital: This is when you receive funding from a venture capitalist in exchange for a portion of your company’s equity. Venture capitalists typically invest their own personal savings in high-growth businesses with a lot of potential.

Resources to Write a Bank Business Plan

To write a bank business plan, you’ll need access to a variety of resources, including:

Sample Plans for Your Business

A good place to start is by looking at some sample plans for businesses in your industry. This will give you a good idea of the types of information to include in your own plan.

Business planning software

There are a number of software programs that can help you create professional-looking plans for your business.

Market Research

When writing a business plan for a bank, it’s important to include a section on your company’s market research. This will include detailed information about your industry, your market, and your competition.

Industry Analysis

In order to accurately describe your industry and the market for your products or services, you’ll need to conduct an industry analysis. This should include information about the size and growth of the industry, the key players in the industry, and any major trends or changes that are taking place.

Target Market Analysis

To effectively market your products or services, you need to understand who your target market is. This should include information about the demographics of your target customers (age, gender, income, etc.), psychographics (lifestyle preferences, interests, etc.), and geographic (location, region).

Competition Analysis

In order to differentiate your business from the competition, you’ll need to know what they’re offering and how they’re positioning themselves in the market. This should include a SWOT analysis (strengths, weaknesses, opportunities, threats) of your competitors.

Customer Segments

A customer segment is a group of customers who share common characteristics, such as age, income, location, or lifestyle preferences. When creating business plans for a bank, it’s important to identify and target your key customer segments. This will help you focus your marketing efforts and create products and services that appeal to your target market.

There are a variety of ways to segment customers, including:

• Demographics: Age, gender, income, location, etc.
• Psychographics: Lifestyle preferences, interests, etc.
• Behavior: How they interact with your brand, what channels they use to purchase products or services, etc.
• Usage: How often they purchase your product or service, how much they spend, etc.
• Value: How much they’re willing to pay for your product or service, how much they value customer service, etc.

Once you’ve identified your customers, you can create buyer personas. These are fictional characters that represent your ideal customer within each segment. Creating buyer personas will help you better understand your target market and create more effective marketing campaigns.

Financial templates

If you’re not familiar with financial terminology or calculations, use a financial template to help you develop your business’s financial projections as well as including an income statement and balance sheets.

Accounting and Legal Advice 

It’s important to seek out accounting and legal advice from professionals who can help ensure that your business plan is accurate and complete.

Bank Business Plan Template

While there is no one-size-fits-all template for writing a business plan, there are some key elements that should be included. Here is a brief overview of what should be included:

Executive Summary

This is a high-level overview of your company, its products or services, and its financial situation. Be sure to include information on your target market, your competitive advantage, and your plans for growth.

Company Description

This section provides more detail on your company, including its history, structure, and management team. Be sure to include information on your company’s mission and vision, as well as its values and goals.

Products and Services

Here you will describe your company’s products or services in detail, including information on your target market and your competitive advantage.

Market Analysis

In this section, you will provide an overview of your market, including demographic information and information on current and future trends. This is also a good section to add the marketing plan you have developed to appeal to potential customers.

Sales and Marketing

This section will detail your sales and marketing strategy, including information on your pricing, your distribution channels, and your promotion plans.

Financial projections

This is perhaps the most important section of your business plan, as it will provide lenders and investors with an idea of your company’s financial health. Be sure to include detailed information on your past financial performance, as well as your projections for future revenue and expenses. This is also a good section to include your cash flow statements, income statements, and information about any bank accounts opened for your business.

This is where you will include any supporting documents, such as your financial statements, marketing materials, or product data sheets.

While this is not an exhaustive list of everything that should be included in your bank business plan, it covers the most important elements. By taking the time to write a well-thought-out and detailed business plan, you will increase your chances of securing the funding you need to grow your business.

Opening a bank is a detailed and complex process, but it can be enormously rewarding both professionally and financially. The best way to increase your chances of success is to write a business plan that outlines all aspects of opening and running a bank. This document should include market analysis, organizational structure, financial projections, and more. Our team has extensive experience helping entrepreneurs open banks. We have created a comprehensive business plan template that covers all the key points you need to consider when writing your own business plan. By following our template, you can be sure that you haven’t missed any essential elements in your planning process. Investing in professional help when writing your business plan gives you the best chance for success when opening a new bank.

Bank Business Plan Template FAQs

Do i need to use a business plan template.

There is no one-size-fits-all answer to this question. If you are seeking funding from a lender or investor, they may have specific requirements for the format and content of your business plan. In other cases, using a template can be helpful in ensuring that you include all of the important information in your plan.

Where can I find a business plan template?

There are a number of resources that offer business plan templates, including the Small Business Administration (SBA) and the U.S. Chamber of Commerce. Additionally, many software programs that offer business planning tools also include templates.

How long should my business plan be?

Again, there is no one-size-fits-all answer to this question. The length of your business plan will depend on the complexity of your business and the amount of detail you need to include. In general, however, most business plans range from 20 to 50 pages.

Do I need to hire a professional to help me write my business plan?

While you are not required to hire a professional to write your business plan, it may be helpful to do so. A professional can help you ensure that your plan is well-written and free of errors. Additionally, they can offer advice on how to best structure your plan and make it more likely to succeed.

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How to get started creating your business plan, a successful business plan can help you focus your goals and take actionable steps toward achieving them. here’s what to consider as you develop your plan..

Regardless of whether or not you’re pitching to investors and lenders, starting a business requires a plan. A business plan gives you direction, helps you qualify your ideas and clarifies the path you intend to take toward your goal.

Four important reasons to write a business plan:

• Decision-making:  Business plans help you eliminate any gray area by writing specific information down in black and white. Making tough decisions is often one of the hardest and most useful parts of writing a business plan. 
• A reality check:  The first real challenge after deciding to launch a new venture may be writing the business plan. Through the process, you may realize your business idea is a bit flawed or not yet fully developed. This may feel like extra work, but the effort you put into improving your idea during this step can bolster your chance of future success. 
• New ideas: Discovering new ideas, different approaches and fresh perspectives are invaluable parts of the business planning process. Working closely with your concept can lead to unexpected insights, shifting your business in the right direction. 
• Developing an action plan: Your business plan is a tool that will help you outline action items, next steps and future activities. This living, breathing document shows where you are and where you want to be, with the framework you need to get there.

Business plan guide: How to get started

Use this exercise to gather some of the most important information. When you're ready to put an outline together, follow our standard business plan template (PDF) and use this business plan example to use as a guide as you fill in your outline. Once your outline is finalized, you can share it with business partners, investors or banks as a tool to promote your concept.

• Vision: Your vision statement sets the stage for everything you hope your business will accomplish going forward. Let yourself dream, pinpointing the ideas that will keep you inspired and motivated when you hit a bump in the road. 
• Mission: A mission statement clarifies the purpose of your business and guides your plan, ultimately answering the question, "Why do you exist?" 
• Objectives: Use your business objectives to define your goals and priorities. What are you going to accomplish with your business, and in what timeframe? These touchstones will drive your actions and help you stay focused. 
• Strategies: Your objectives describe what you’re going to do, while your strategies describe how you’re going to do it. Consider your goals here, and identify the different ways you’ll work to reach them. 
• Startup capital: Determine what your startup expenses will be. Having a clear idea will allow you to figure out where the money is coming from and help you spend what you have in the right areas. 
• Monthly expenses: What do you estimate your business’ ongoing monthly expenses will be? This may change significantly over time — consider what your expenditure could be immediately after launch, in three months, in six months and in one year. 
• Monthly income: In order to cover your expenses (and hopefully make a profit), you will need to estimate your income. What are your revenue streams? It's always wise to diversify your income. That way, you won’t be tied to one stream that might not be lucrative as quickly as you need it to be. 
• Goal-setting and creating an action plan: Once you have all the specifics outlined, it's time to set up the step-by-step action items explained in the companion guide, a standard business plan outline. This process will utilize the hard work you've already done, breaking each step down in a way that you can follow.   

A business plan isn’t necessarily a static document that you create once and then forget about. You can use it as a powerful tool by referencing it to adjust your priorities, stay on track and keep your goals in sight.

Business plan: An outline

Use this exercise to gather important information about your business.

Answer these questions to start your planning process. Your responses will provide important information about your business, which you can use as an overview to develop your plan further.

• What is your dream? 
• What do you feel inspired to do or create?
• What keeps you motivated, even in the face of uncertainty?  
• Why does this business exist? 
• What purpose(s) or need(s) does it fulfill for customers?   

Objectives 

• List the goals of your company, then number them in order of importance. 
• What will the business accomplish when it’s fully established and successful? 
• How much time will it take to reach this point?  
• For each goal or objective listed above, write one or more actions required to complete it.   

Startup capital 

• List any and all startup expenses that come to mind. 
• Next to each: 
• Estimate the cost of any expenses you can. 
• List the most likely source of the funding. 
• Circle the high-priority expenses. 
• Assess whether your available capital is going toward the high-priority items. If not, reconsider the way you will allocate funds.  

Monthly expenses

• If you can, estimate your business’ ongoing monthly expenses immediately after launch, in three months, in six months and in one year. 
• If you can’t, what information will you need in order to estimate your expenses?  

Monthly income 

• What are your revenue streams? Estimate your monthly income accordingly. 
• Which revenue sources deliver fast or slow returns? Are there other sources you could consider to diversify assets?  
• After completing your outline, reference your responses as you work through a traditional business plan guide. This next step will allow you to expand and add more detailed information to your plan. 
• When you’re ready to make your formal plan, reference this companion guide, a standard business plan outline  (PDF). We've also included a  business plan example  to help as you fill in your outline. 

Learn how U.S. Bank can support you and your business needs at usbank.com/small-business.

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Sample Commercial Bank Business Plan

Here is how to write a commercial bank business plan .

The financial services sector of any economy can never be complete without the services offered by commercial banks.

Commercial and private banks are profit-based. They grant loans, accept deposits, and also offer other types of financial services like electronic banking (including the transfer of funds among others).

Commercial Banking Business Plan Sample

In writing your commercial bank business plan, the following sections should not be left out.

These are basic to having a successful and implementable plan. They include the executive summary section, the company description, market analysis, and competitive analysis sections.

Additional sections include a description of management and organization, breakdown of products and services, marketing plan, sales strategy, request for funding, and financial projections.

Each of these is key to writing a comprehensive commercial bank business plan.

Executive Summary Section

As the name suggests, your commercial bank business plan should have the executive summary section. This should be the first section of your plan. Though this is the usual pattern, it is written last.

This is understandable because it summarizes your entire plan.

Now, the executive summary section of your business shouldn’t belong. It should be a page or two at most. To provide your reader with an enjoyable presentation of what your commercial bank business is about, it should follow a basic format;

Questions that will need to be answered here include what your commercial bank business is about, how it fits into the marketplace, and the problem it solves. One of the common problems it solves involves reaching the unbanked population with basic as well as innovative commercial banking services.

What is the cost of starting a commercial banking business and how much financing do you need? The investor(s) is interested in how their investments plus interest will be recouped. So, what is the return on investment like?

Your vision and mission statements must be added including how the ownership structure of your commercial bank operations is.

Company Description

A detailed description of your commercial bank business must be provided under this section. Important information must be provided here including your goals, as well as your target market.

There should be a discussion of how your banking operations will stand out from the rest. Also, you must state how your services and products (if any) will be helpful to clients or your target market.

Market Analysis

This is one of the most crucial parts of your commercial bank business plan. Here, an in-depth assessment of the financial services industry is required to enable you to have a full grasp of specific gaps you need to fill.

The use of data and statistics to explain the industry as well as findings and trends is very important. That way, a likely direction is identified and you’re able to seek innovative ways to serve your target clients better.

Competitive Analysis

Commercial banking is a highly competitive sector.

As such, you’ll need to determine or analyze how your business will come, what gaps to fill and also identify your competitors (other commercial banks).

When identifying your competitors, your goal is to know their strengths and weaknesses and finding ways your commercial banking operations will stack up against such.

Description of Management & Organization

Your commercial bank business needs an organizational structure.

Here, you’ll need to elaborate on membership, qualifications, and positions within your management team to be filled. Only skilled and experienced professionals must be picked for such positions.

The structure your commercial bank will take or adopt is also important and must be clearly stated. Membership of your bank’s board of directors must also be identified and provided.

Breakdown of Products and Services

Commercial banking operations are mostly service-based.

However, depending on your areas of interest, you may want to create products such as project finance, industrial loans, leasing, syndicated loans, bills of exchange, foreign trade financing among several others.

Marketing Plan

Marketing is a basic part of commercial banking operations.

As such, you’ll need to have a detailed plan on how you intend to sell your products to clients (both new and existing). A well-written marketing plan should include market research, identify a target market, and also discuss positioning.

Other vital components include competitive analysis, market strategy, budget, and metrics. These enable you to come up with an effective marketing strategy that bolsters your operations leading to increased levels of success.

Sales Strategy

Every service or product offered by a commercial bank needs to be sold. Here, you’ll need to discuss the ways and strategies through which your services and products will be sold. There must be clarity.

Apart from the methods to be adopted, strategies may include the hiring and deployment of sales reps to specific targets or clients. With an effective sales strategy, your commercial banking operations are likely to be successful in the long run.

Request for Funding

Part of the requirements for starting a successful commercial banking operation involves getting the funding necessary. For this to be possible, you’ll need to request funding.

Here, discussions will focus on the amount required for the takeoff of your bank.

Detailed information on how these funds will be spent is also essential. You may also want to disclose future funding requirements for any projects or expansion plans to your operations (if any).

With detailed information provided on these, your chances of getting the needed funding are significantly increased.

Financial Projections

This section discusses the anticipated revenue and must include set goals or targets based on market research.

A full report of your anticipated revenue covering 12 months and also your projected earnings for a period covering 5 years must be included.

Clarity is of the essence when it comes to writing a commercial bank business plan. Not only does this help your reader fully grasp its contents, but it also enables you to strategically implement your banking operations.

Here, we’ve provided tips and guidance on how to go about writing your commercial banking business plan. The sections included here are crucial and must be covered in detail. No aspect of your operations must be left out.

Equally important is the need to fully implement its content.

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550+ Business Plan Examples to Launch Your Business

Need help writing your business plan? Explore over 550 industry-specific business plan examples for inspiration.

Find your business plan example

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View all sample business plans

Example business plan format

Before you start exploring our library of business plan examples, it's worth taking the time to understand the traditional business plan format . You'll find that the plans in this library and most investor-approved business plans will include the following sections:

Executive summary

The executive summary is an overview of your business and your plans. It comes first in your plan and is ideally only one to two pages. You should also plan to write this section last after you've written your full business plan.

Your executive summary should include a summary of the problem you are solving, a description of your product or service, an overview of your target market, a brief description of your team, a summary of your financials, and your funding requirements (if you are raising money).

Products & services

The products & services chapter of your business plan is where the real meat of your plan lives. It includes information about the problem that you're solving, your solution, and any traction that proves that it truly meets the need you identified.

This is your chance to explain why you're in business and that people care about what you offer. It needs to go beyond a simple product or service description and get to the heart of why your business works and benefits your customers.

Market analysis

Conducting a market analysis ensures that you fully understand the market that you're entering and who you'll be selling to. This section is where you will showcase all of the information about your potential customers. You'll cover your target market as well as information about the growth of your market and your industry. Focus on outlining why the market you're entering is viable and creating a realistic persona for your ideal customer base.

Competition

Part of defining your opportunity is determining what your competitive advantage may be. To do this effectively you need to get to know your competitors just as well as your target customers. Every business will have competition, if you don't then you're either in a very young industry or there's a good reason no one is pursuing this specific venture.

To succeed, you want to be sure you know who your competitors are, how they operate, necessary financial benchmarks, and how you're business will be positioned. Start by identifying who your competitors are or will be during your market research. Then leverage competitive analysis tools like the competitive matrix and positioning map to solidify where your business stands in relation to the competition.

Marketing & sales

The marketing and sales plan section of your business plan details how you plan to reach your target market segments. You'll address how you plan on selling to those target markets, what your pricing plan is, and what types of activities and partnerships you need to make your business a success.

The operations section covers the day-to-day workflows for your business to deliver your product or service. What's included here fully depends on the type of business. Typically you can expect to add details on your business location, sourcing and fulfillment, use of technology, and any partnerships or agreements that are in place.

Milestones & metrics

The milestones section is where you lay out strategic milestones to reach your business goals.

A good milestone clearly lays out the parameters of the task at hand and sets expectations for its execution. You'll want to include a description of the task, a proposed due date, who is responsible, and eventually a budget that's attached. You don't need extensive project planning in this section, just key milestones that you want to hit and when you plan to hit them.

You should also discuss key metrics, which are the numbers you will track to determine your success. Some common data points worth tracking include conversion rates, customer acquisition costs, profit, etc.

Company & team

Use this section to describe your current team and who you need to hire. If you intend to pursue funding, you'll need to highlight the relevant experience of your team members. Basically, this is where you prove that this is the right team to successfully start and grow the business. You will also need to provide a quick overview of your legal structure and history if you're already up and running.

Financial projections

Your financial plan should include a sales and revenue forecast, profit and loss statement, cash flow statement, and a balance sheet. You may not have established financials of any kind at this stage. Not to worry, rather than getting all of the details ironed out, focus on making projections and strategic forecasts for your business. You can always update your financial statements as you begin operations and start bringing in actual accounting data.

Now, if you intend to pitch to investors or submit a loan application, you'll also need a "use of funds" report in this section. This outlines how you intend to leverage any funding for your business and how much you're looking to acquire. Like the rest of your financials, this can always be updated later on.

The appendix isn't a required element of your business plan. However, it is a useful place to add any charts, tables, definitions, legal notes, or other critical information that supports your plan. These are often lengthier or out-of-place information that simply didn't work naturally into the structure of your plan. You'll notice that in these business plan examples, the appendix mainly includes extended financial statements.

Types of business plans explained

While all business plans cover similar categories, the style and function fully depend on how you intend to use your plan. To get the most out of your plan, it's best to find a format that suits your needs. Here are a few common business plan types worth considering.

Traditional business plan

The tried-and-true traditional business plan is a formal document meant to be used for external purposes. Typically this is the type of plan you'll need when applying for funding or pitching to investors. It can also be used when training or hiring employees, working with vendors, or in any other situation where the full details of your business must be understood by another individual.

Business model canvas

The business model canvas is a one-page template designed to demystify the business planning process. It removes the need for a traditional, copy-heavy business plan, in favor of a single-page outline that can help you and outside parties better explore your business idea.

The structure ditches a linear format in favor of a cell-based template. It encourages you to build connections between every element of your business. It's faster to write out and update, and much easier for you, your team, and anyone else to visualize your business operations.

One-page business plan

The true middle ground between the business model canvas and a traditional business plan is the one-page business plan . This format is a simplified version of the traditional plan that focuses on the core aspects of your business.

By starting with a one-page plan , you give yourself a minimal document to build from. You'll typically stick with bullet points and single sentences making it much easier to elaborate or expand sections into a longer-form business plan.

Growth planning

Growth planning is more than a specific type of business plan. It's a methodology. It takes the simplicity and styling of the one-page business plan and turns it into a process for you to continuously plan, forecast, review, and refine based on your performance.

It holds all of the benefits of the single-page plan, including the potential to complete it in as little as 27 minutes . However, it's even easier to convert into a more detailed plan thanks to how heavily it's tied to your financials. The overall goal of growth planning isn't to just produce documents that you use once and shelve. Instead, the growth planning process helps you build a healthier company that thrives in times of growth and remain stable through times of crisis.

It's faster, keeps your plan concise, and ensures that your plan is always up-to-date.

Download a free sample business plan template

Ready to start writing your own plan but aren't sure where to start? Download our free business plan template that's been updated for 2024.

This simple, modern, investor-approved business plan template is designed to make planning easy. It's a proven format that has helped over 1 million businesses write business plans for bank loans, funding pitches, business expansion, and even business sales. It includes additional instructions for how to write each section and is formatted to be SBA-lender approved. All you need to do is fill in the blanks.

How to use an example business plan to help you write your own

How do you know what elements need to be included in your business plan, especially if you've never written one before? Looking at examples can help you visualize what a full, traditional plan looks like, so you know what you're aiming for before you get started. Here's how to get the most out of a sample business plan.

Choose a business plan example from a similar type of company

You don't need to find an example business plan that's an exact fit for your business. Your business location, target market, and even your particular product or service may not match up exactly with the plans in our gallery. But, you don't need an exact match for it to be helpful. Instead, look for a plan that's related to the type of business you're starting.

For example, if you want to start a vegetarian restaurant, a plan for a steakhouse can be a great match. While the specifics of your actual startup will differ, the elements you'd want to include in your restaurant's business plan are likely to be very similar.

Use a business plan example as a guide

Every startup and small business is unique, so you'll want to avoid copying an example business plan word for word. It just won't be as helpful, since each business is unique. You want your plan to be a useful tool for starting a business —and getting funding if you need it.

One of the key benefits of writing a business plan is simply going through the process. When you sit down to write, you'll naturally think through important pieces, like your startup costs, your target market , and any market analysis or research you'll need to do to be successful.

You'll also look at where you stand among your competition (and everyone has competition), and lay out your goals and the milestones you'll need to meet. Looking at an example business plan's financials section can be helpful because you can see what should be included, but take them with a grain of salt. Don't assume that financial projections for a sample company will fit your own small business.

If you're looking for more resources to help you get started, our business planning guide is a good place to start. You can also download our free business plan template .

Think of business planning as a process, instead of a document

Think about business planning as something you do often , rather than a document you create once and never look at again. If you take the time to write a plan that really fits your own company, it will be a better, more useful tool to grow your business. It should also make it easier to share your vision and strategy so everyone on your team is on the same page.

Adjust your plan regularly to use it as a business management tool

Keep in mind that businesses that use their plan as a management tool to help run their business grow 30 percent faster than those businesses that don't. For that to be true for your company, you'll think of a part of your business planning process as tracking your actual results against your financial forecast on a regular basis.

If things are going well, your plan will help you think about how you can re-invest in your business. If you find that you're not meeting goals, you might need to adjust your budgets or your sales forecast. Either way, tracking your progress compared to your plan can help you adjust quickly when you identify challenges and opportunities—it's one of the most powerful things you can do to grow your business.

Prepare to pitch your business

If you're planning to pitch your business to investors or seek out any funding, you'll need a pitch deck to accompany your business plan. A pitch deck is designed to inform people about your business. You want your pitch deck to be short and easy to follow, so it's best to keep your presentation under 20 slides.

Your pitch deck and pitch presentation are likely some of the first things that an investor will see to learn more about your company. So, you need to be informative and pique their interest. Luckily, just like you can leverage an example business plan template to write your plan, we also have a gallery of over 50 pitch decks for you to reference.

With this gallery, you have the option to view specific industry pitches or get inspired by real-world pitch deck examples.

Ready to get started?

Now that you know how to use an example business plan to help you write a plan for your business, it's time to find the right one.

Use the search bar below to get started and find the right match for your business idea.

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Get Your Loan Approval Quickly

Business plans for bank & sba loans, when it comes to bank and small business administration (sba) loans for startups and acquisitions, a business plan is the cornerstone of your funding eligibility..

Strategize. Secure. Succeed.

Unlocking business potential with sba-backed loans, bank & sba loans offer a powerful springboard for budding entrepreneurs and established businesses to launch and grow ventures. .

Starting a business journey is a monumental step, and the right financial backing can make all the difference . Securing a business loan, especially one guaranteed by the Small Business Administration (SBA), comes with its set of stringent standards . Central to these requirements is the necessity of a comprehensive business plan . At Masterplans, we recognize the significance of this document and the rigorous standards it must adhere to, ensuring your business is set on a path to success .

“ I’m out there trying to find real estate and sign leases and hire management teams. I don’t have time to write the business plan myself.

Masterplans presented me with an expert piece of work that displayed everything i'm trying to accomplish in the next five years.”.

Travis Grappo Owner/Operator, Oak House

Why Business Owners Trust Masterplans

With 18,000+ business plans crafted across diverse industries, here's why savvy entrepreneurs consistently choose to partner with us when they seek bank funding..

Experience & Expertise

For over two decades, Masterplans has had the privilege of turning the dreams of founders into reality by crafting business plans ready for both traditional bank lending and the SBA loan application process. 

Award-Winning Excellence

Our reputation as an award-winning firm is built on our unwavering commitment to quality and customer satisfaction. We take immense pride in the feedback from lenders who consider our business plans the best they've ever seen.

Proven Track Record

Our approach is grounded in enterprise-level research and analysis from pay-to-access platforms like IBISWorld, Esri, and Statista, ensuring your plan is a tool to obtain business financing and a practical roadmap to achieve your goals.

cutting through the red tape

Navigate the intricacies of the commercial loan process with confidence, we turn complexity into clarity, saving you time and headaches..

The banking landscape, with its maze of requirements, can be overwhelming and intimidating, especially for those venturing into the SBA loan process for the first time.

With Masterplans by your side, you're not navigating this terrain alone. You benefit from two decades of experience to ensure that you are prepared for your loan interview. Our understanding of the nuances of underwriting eliminates potential headaches, saving you invaluable time, and providing you with a clear path to loan approval.

Download Sample Business Plans ›

Key Sections a Bank & SBA Business Plan

Your business plan is structured so loan officers and underwriters can easily find what they need, while ensuring a cohesive, consistent, and comprehensive overview of your venture..

Executive Summary

You never get a second chance to make a great first impression. An Executive Summary provides a concise yet compelling snapshot of your venture , ensuring lenders immediately grasp its potential and viability. Integral to this is clearly stating your startup costs and the specific reasons why. The Executive Summary should stand on its own, but more than that, it should leave the banker wanting to learn more.

Company Overview

This company description provides a comprehensive overview of your business, highlighting its unique business model, products and services, and competitive advantage. It underscores your business's unique value proposition , its position within the market, and, critically, details of the sources and uses of funds during the startup, expansion, or acquisition phase.

Market Analysis

To secure a bank loan, your business plan must demonstrate deep understanding of your local market and offer a thorough industry analysis to gauge your projections within that context . Masterplans employs industry-leading market research tools , such as Statista, IBISWorld, and Esri's Business Analyst, to ensure that you grasp the broader industry trends as well as the dynamics of your specific target market.

Strategy & Implementation

The "Strategy & Implementation Summary" provides a detailed roadmap of pragmatic steps and tactics essential for reaching your business goals. Included is a synopsis of your marketing plan, meticulously crafted to convey how your business will attract your target customer .

Management Team

At the heart of a business's potential to service a loan is the capability of the business owner and managers. By spotlighting the hands-on professional experience and industry knowledge that prepares them to run and manage the business effectively, Masterplans ensures that a potential lender will have confidence in the leadership's ability to drive consistent performance.

Financial Projections

Masterplans builds a custom five-year financial projection, which includes an income statement, cash flow statement , and balance sheets that are grounded in solid assumptions and drivers. This approach ensures bankers see a realistic and reliable revenue projection , ensuring key metrics like the Debt Service Coverage Ratio (DSCR) are met.

“It was obvious that everyone who worked on the business plan put in a lot of effort and took pride in what they did.

It read so fluidly. every page led into the next, and it was easy for the bank to find the information they needed.”.

Peter Schellinger Owner/Operator, Diversified Land Management

Make SBA Lenders Compete for you

We put you in the driver’s seat, rather than being just another loan applicant, transform yourself into a sought-after client, making banks compete for your business..

A bank-ready business plan from Masterplans not only showcases your company's potential, but also outlines potential risks and offers strategies to address them , reassuring lenders of your proactive approach.

Our team of business plan writers provide small business owners with the leverage to attract multiple lenders, ensuring you get the best possible terms. With Masterplans, you're not just obtaining a loan; collaborating with us means delving into strategic planning that not only secures loan terms to set you up for success, but also ensures you're fully prepared to capitalize on it .

Our Latest Bank-Ready Business Plans

For over 21 years, we've been privileged to collaborate with clients spanning every industry. below are just a few of the 18,000+ business plan projects we've worked on..

Team Member Spotlight

Christina hersey, with over a decade of experience as a business plan writer, christina helps clients understand and exceed the stringent requirements of banks and the sba..

Christina's clients frequently commend her uncanny ability to "get into their head," a talent she seamlessly integrates into her role as Team Lead. She's fluent in English, Greek, and Spanish. Her dedication to excellence ensures that every business plan is not only compliant but also compelling, positioning entrepreneurs for success.

Meet The Team ›

Business plans for sba & bank loans faqs,  we've compiled a list of frequently asked questions to provide clarity on our service and process. if you don't find the answer to your specific question here, please don't hesitate to contact us ., how is the cost of a business plan for bank and sba loans determined.

Our pricing is influenced by several factors including industry type, plan length and scope, variables like multiple physical locations, the intended audience, and your timeframe.

Our bank-ready business plans typically range from $1,800 to $5,100, based on complexity and the team members required. This fee covers an in-depth discovery process, detailed research, professional writing and editing, and advanced financial modeling. We are happy to provide a complete scope of work for your project, free of charge, in as little as 24 hours. Simply contact us to set up an appointment.

For more information about what is included in our engagements, please see our pricing page .

How many pages is an bank-ready business plan?

The ideal length of a bank/SBA-loan business plan is precisely as long as it needs to be, and not a page more. While most bank-ready business plans fall within the 30-45 page range, with around 15 pages dedicated to financial statements, it's essential to remember that quality isn't determined by page count. Evaluating a business plan's merit based solely on its length misses the true value and depth of its content. 

You can see some examples of our bank-ready business plans here .

How long will my business plan project take?

Our projects kick off within 24 hours of receiving payment. From there, the timeline largely depends on your pace and preferences. Some clients prefer a more deliberate and procedural approach, while others are working against tight deadlines. Typically, we can deliver a complete first draft of the business plan within two weeks. We offer both 45-day and 90-day engagement timelines, ensuring ample time to integrate your feedback and steer the direction of the project.

You can learn more about our process and timeline here.

Do you guarantee funding, or accept payment after funding?

Our primary goal is to provide a top-notch business plan that positions clients in the best light for lenders. There are too many other factors involved for us to guarantee funding. We do, however, guarantee that if your bank loan is turned down on the basis of the business plan, we will refund your money in full. (Note: In over 20 years of business plan writing, this has never happened. Not once.)

As far as payments go, all terms are discussed upfront, and payment after funding is not a typical arrangement.

Will you help find funding?

While we specialize in crafting bank-ready business plans, we are not a certified SBA loan broker, which means we don't facilitate the SBA loan application process directly in exchange for a fee. However, over our 21-year tenure, we've fostered relationships with both regional and national banks. As a result, we are often able to make introductions where appropriate.

For those specifically interested in SBA loans, many clients find success working with preferred SBA lenders in your local market. We recommend using the SBA's Lender Match tool to find suitable lenders. You can access this resource at SBA Lender Match .

What experience do I need for an SBA loan?

Experience is a crucial factor when it comes to securing a loan for your business. Most lenders, including those offering SBA-backed loans, require applicants to have a certain level of experience in the industry or business they intend to operate; for example, the SBA typically requires a small business owner to have a minimum of five years of relevant experience. This experience can be in a management or operational role within the industry. If you lack direct industry experience but have other strong qualifications, such as a solid track record in a management or supervisory role in another field, you may still be considered for a loan.

The aim of this requirement is to ensure that you have the necessary expertise to manage and grow a successful enterprise. Lenders view this experience as a strong indicator of your ability to repay the loan and operate a viable business.

For more details on what's required for an SBA-backed loan, you can refer to our comprehensive guide on SBA loans .

Will a bank or the SBA fully-fund my business?

In many instances, SBA loans necessitate collateral as a form of security for the lender. Most SBA loans will require a down payment of 20%, and having assets that can be used as collateral can enhance your loan application. Additionally, demonstrating a personal investment in your business showcases commitment and responsibility, further augmenting your eligibility.

How important is my credit score when presenting my business plan to lenders or investors?

Your credit score plays a pivotal role when seeking financing, especially from traditional lenders like banks. It serves as a numerical summary of your financial reliability based on your past borrowing and repayment behaviors.

Most banks have minimum credit score requirements, often setting a threshold at or above 600. It's common for lenders to have a benchmark of 620. A higher score not only increases your likelihood of securing financing but can also secure more favorable terms for the loan.

Can a bank business plan be used to find an investor?

Generally, the expectations and objectives of investors differ from those of bank lenders. Banks tend to prioritize funding small businesses that foster local job creation, adopting a naturally conservative approach. In contrast, investors typically search for ventures with potential for rapid scaling and significant earnings, inherently embracing greater risk.

However, there are unique scenarios, especially when real estate plays a role , where an investor might be included in the capital stack. In such instances, we are well-equipped and eager to assist in presenting these cases effectively.

Do you use a standard "business plan template" or an "SBA business plan template" when developing plans for clients?

Every business is distinct, and consequently, every business plan we develop is uniquely tailored to that enterprise. While we don't rely on a specific "business plan template" or "SBA business plan template," our vast experience allows us to craft plans with efficiency. By building on our accumulated knowledge, we ensure both customization and efficiency in our deliverables.

Talk With An Expert Today

Leverage over two decades of experience by scheduling a free , no-obligation, 30-minute consultation with  one of our business plan experts..

The Latest from the Masterplans Blog

Are you looking for quick tips and advice on business planning and entrepreneurship.

Our latest blog posts offer valuable insights that cover a range of essential topics – from the art of refining a business idea and how to write business plans for banks, to the qualifications and requirements of SBA lending.

How to Write a Management Summary for Your Business Plan

Entrepreneurs are often celebrated for their uncanny ability to understand others – their customers, the market, and the ever-evolving global landscape. However, sometimes the most...

Understanding Venture Debt vs Venture Capital

Despite growth in sectors like artificial intelligence, venture capital funding has seen better days. After peaking at $347.5 billion in 2021, there was a 30% decline in equity...

Going Beyond Writing: The Multifaceted Role of Business Plan Consultants

Most people think of a professional business plan company primarily as a "business plan writer." However, here at Masterplans, we choose to approach this role more broadly and...

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Plan a Business

Consider entrepreneurship.

The reality, according to the U.S. Small Business Administration, is that less than 50 percent of all new businesses last more than two years. They also attribute 95 percent of all business failures to the business owner’s lack of experience and expertise.

Before launching a venture of your own, strongly consider gaining experience and expertise working for someone else, especially a successful leader in the field. People with a solid track record who have thoroughly thought through their new venture have a far greater chance of success than those who have not.

In addition to experience and expertise, many successful entrepreneurs share certain personal qualities. Although it’s a rare individual who excels in  all  of the traits listed below, reviewing this list may help you decide whether entrepreneurship is a career path you’d like to pursue.

Key attributes of successful entrepreneurs

• Takes initiative.  A self-starter. Makes things happen rather than waiting and reacting. Self-directed. Independent. Doesn’t need a boss.
• Driven to achieve.  Has desire and passion to succeed. Enjoys competition. Has energy and stamina. Willing to work more than forty hours a week. Willing to sacrifice to achieve goals and dreams.
• Positive mental attitude.  Self-confident. Believes in self. Trusts own ideas, instincts, and abilities.
• Sets goals.  Creates a vision of success. Works with focus and intention.
• Plans ahead.  Creates plans and follows them. Updates plans periodically. Good at anticipating new developments.
• Resourceful.  Creative problem-solver. Imaginative and innovative. Sees better ways of doing things. Uncovers new resources and opportunities. Finds a way.
• A leader.  Takes responsibility and accepts accountability. Like to make decisions. Shows an attitude of respect for others. Motivates and inspires others. Gives others the opportunity to be great. Shares the credit for success. Gains the respect of peers.
• Good communicator.  Likes people. Has great people skills. Good listener. Effective negotiator.
• Always learning.  Open to new ideas. Learns from others.
• Leverages exceptional skills.  Makes the most of personal strengths, but doesn’t try to be and do everything.
• Has technical knowledge.  Understands both general business practices and the processes used to deliver goods and services.
• Organized.  Able to prioritize. Good time manager. Gets things done on time.
• Objective.  Able to evaluate risk. Willing to take calculated risks. Can make good decisions under pressure.
• Uses money well.  Good money manager. Sees money as a tool for business success rather than an end in itself.
• Realistic.  Accepts the ups and downs of business. Willing to face facts and change strategy or direction when needed.
• Persistent.  Has determination and self-discipline. Follows through. Meets commitments. Will dedicate however much time it takes. Never gives up.
• Bounces back.  Accepts rejection and failure without being defeated. Flexible. Adapts to changing conditions. Learns from experience and mistakes, creates new plans, and moves ahead.

As you review the items you checked, notice the items you didn’t. To succeed, you’ll need to find ways to fill your gaps.

Remember : there are millions of successful small businesses in our country, but there’s always room for one more. When you think about  your  future in the world of work, consider the option of starting a business of your own.

write a business plan

• Key components
• Most important elements

The purpose of a business plan is to serve as a roadmap for the present and a vision of the future. It can also help to attract investors for your business.  The SBA and Small Business Development Centers can help you to create a business plan. There are many books and Web sites on the subject.  Here are key components of what the plan should include:

Executive summary  – business concept, key success factors, and financial situation/needs

Company profile  – inspirational vision statement describing the business you want to create, including who your customers will be, what and how you plan to sell to them; and, a mission statement describing why your business exists and why customers will buy your product or service. The best mission statements briefly but powerfully convey a company’s commitment to its customers.

Products and services  – product/service description, positioning of products/services, and competitive evaluation of products/services

Competitive analysis  – industry overview, competition, competitor products and services, opportunities; key strengths and weaknesses compared to your competitors,

Market analysis  – market overview, market segments, and target market and customers. To show investors or lenders that you have researched the market and understand the challenges, include reasons why the venture could fail, and your strategies for addressing these risks.

Objectives  – your highest priority goals in the key areas of your business, including finance marketing, and operations. What do you want to accomplish in the near-term future? Where will you focus your time and resources? The best objectives are clearly-stated, specific, and measurable.

Strategies  – the general approaches you will take to achieve your goals. Strategies describe how you will go about making your business successful over time given the strengths and weaknesses inside your business and the opportunities and threats in the marketplace.

Plans  – the specific action steps you will take to achieve your objectives. Effective plans clearly state “who will do what by when.”

Management qualifications and operations  – key personnel, organizational structure, product/service delivery, customer service/support, facilities. To get bank financing or investors, management experience is a critical element of your plan because investors generally invest in people, not products. A lot of businesses have great product ideas, but not all have the skills and experience to succeed.

Financial information  – assumptions and comments, starting balance sheet and projection, profit-and-loss projection, cash flow projection, ratios and analyses.

If you want to attract investors or get bank financing for your business, the experience of the management team is one of the most important elements of your plan. Your product or service is almost secondary, because, in general, investors invest in people, not products.  A lot of businesses have great product ideas, but not all have the skills and experience to succeed.

Review your business plan twice a year to see if it still fits your company or if you need to make changes to your strategic direction.

a sample business plan

Find financing.

Almost every business needs at least some money to get started. Many seek additional funding at various times after the business is up and running. Where can you find the money you’ll need?

Common sources of start-up funding

If you haven’t saved all of the money you’ll need, you’ll need to combine your own investment with funds from other sources. A lender will have greater confidence in your commitment to succeed when they know you have your own personal investment in the business. Many lenders, including the SBA, often require this.

Your family and friends may believe in you and your business plan and may be willing to loan you funds. Be prepared to show them how and when you’ll be able to repay.

Loans and lines of credit from financial institutions can be a source of start-up funding. To borrow from a financial institution, you need to have good credit. Secured credit is ideal if you’re just starting out and want to build good credit history. Develop a good working relationship with your banker or lender. The more they know about you and your business, the better they can advise and assist you.

The U.S. Small Business Administration (SBA) is an independent agency of the Federal Government. Its purpose is to help people get in business, stay in business, and grow. The SBA offers a tremendous number of resources to help you start, finance and manage your business, and find new business opportunities. It can help you write a business plan, obtain start-up capital, purchase real estate, and much more. The SBA has offices throughout the United States to assist you. Learn more by visiting the SBA Web site at www.sba.gov.

examples of sba services

Starting your business:  Small Business Start-up Kit; training and counseling; business planning tutorial; special assistance programs for minorities, women, the disabled, veterans, and other groups; workshops; shareware.

Financing your business:  Loan programs, including those that focus on: microloans (up to $50,000) for start-up, newly established, or growing small businesses; low and moderate income areas. Working capital lines of credit.

Client commitments to contracts Your customers (or future customers) may be willing to sign contracts, or even pre-pay, for products or services that you commit to deliver to them.

two types of business financing

There are two basic types of business financing, debt financing and equity financing. Here is a comparison of the two:

NEW BUSINESS CHECKLIST

The best place to start in building a business is to ask yourself some basic questions. You may not have all the answers you need right now, but exploring these questions is a good way to spark your thinking and identify the areas you need to research. As you gather the answers, start putting your plan down on paper.

• What products or services will I provide?
• Who will be my customers?
• How will my products and services meet my customers’ needs?
• What equipment or special skills will I need?
• How will I advertise or promote my business?
• Who will be my competitors?
• In the eyes of my customer, how will  my  business compare to what my competitors offer?
• Where will my business be located? Do I need to buy or rent space, or can I work from home?
• Will I operate my business alone (as a sole proprietor) or as a partnership or corporation?
• Will I need to hire employees?
• How will I find people to hire? How will I pay them?
• How much money will I need to start my business?
• How much money will I need to run the business day-to-day?
• Where will I get the money to get started? Do I qualify for a personal loan?
• How will I structure my company?
• What kinds of legal regulations will my business have to meet – for example, laws regarding employees, environmental protection or import/export?
• What kinds of insurance will I need?

Also, keep in mind that there are probably resources available in your own local community, such as business development centers, to help you create your plan. Check with your local library, university or college, and search online to see what’s available in your community.

Related Resources

Launch a Business

Manage a Business

Private Banking Business Plan [Sample Template]

By: Author Tony Martins Ajaero

Home » Business ideas » Financial Service Industry » Bank

Do you want to start a private banking service and need to write a plan? If YES, here is a sample private banking business plan template & feasibility report.

Whether you have decided to enter the financial markets directly as part of your integral business plan, are a smaller private financial institution that has outgrown your licensing boundaries, or are experiencing operational inefficiencies or restrictions with your current financial license, you are likely wondering how to move forward and start a private bank.

When you start a bank, your financial company will have an almost limitless array of possibilities to take advantage of. Financial companies in different situations (including FX, wealth managers, family offices, IB, M&As, FAs, IAs, payment processors, or fund managers) will at some point in their lifecycles find it necessary or desirable to grow beyond their current licensing limitations.

For many such businesses, the natural way to move forward is to obtain or apply for a bank license or register a new private bank from the ground up. Private Banks raise capital through a private stock offering to accredited individuals who meet onerous financial requirements related to their net worth and annual income.

Although privately-held bank stock is not publicly traded, there often is a healthy secondary market for it, engineered by boutique investment banks that focus on small bank stocks and even new hedge funds that invest in de novo banks.

Private Banks earn high returns on assets and equity, and typically are managed conservatively by executives with strong ties to the business community. A small number of non-accredited investors, usually people with personal relationships with insiders, are allowed to participate in the stock offering as well.

The apex control for private banks are the Board of Directors, who appoint the bank’s executive management and oversee the regulatory compliance function. Note that this requires monitoring capital adequacy levels and ensuring the bank never deviate from the FDIC-approved business plan.

If the bank’s directors want to make changes to the bank’s funding structure or expand lending activities, prior approval must be obtained from the FDIC. Regulators typically require that de novo banks exceed capital requirements, understanding that it often takes roughly three years for new banks to achieve profitability.

In the united states, Deposit Insurance Corporation membership is mandated for all banks, and all FDIC requirements must be attained before the new bank commences operations. The Interagency Charter and Federal Deposit Insurance Application must be filled, submitted and shared by the FDIC with all relevant regulatory bodies.

Coupled with the application, the applying bank must submit a mission statement, a business plan containing three years of projected financial statements, and policy descriptions for loans, investments and other bank operations. Note that completing these requirements can take hundreds of hours, and often requires engaging financial consultants.

A Sample Private Banking Business Plan Template

1. industry overview.

In recent years, private banks have experienced a period of growth. For many universal banks, the segment has therefore become undeniably crucial. At the same time, a closer analysis of financial results and the major drivers of sector performance points to some fundamental challenges in growing the top line.

Nevertheless, few banks have outperformed the competition and offer some best practice examples. According to reports, any growth in assets under management (AuM) generated by private banks over the last three years has mostly been driven by favourable market performance rather than new business.

Of the 6.2 percent average compound annual growth rate (CAGR) between 2015 and 2018, 4.0 percent was accredited to an increase in asset value. Simply put, only approximately one third of AuM growth was self-generated. Much of this self-generated growth has been achieved inorganically, and this is certainly true for three out of the top five performing banks.

In Europe, Switzerland and North America, mergers and acquisitions (M&A) activity contributed to double-digit growth for a number of banks. Chinese private banks have been an exception to this pattern. In their case, unprecedented rates of wealth creation made organic growth possible.

According to reports, the wealth of Chinese billionaires increased by 39 percent in 2017 alone, with two new billionaires created each week. Even with the favourable market performance, many banks were not able to maintain their revenue margins.

What stood in their way were pressure from low interest rates, stricter regulation leading to the elimination of certain revenue streams and a drive for greater price transparency, and a changing portfolio composition with more assets falling into higher wealth buckets (with lower revenue margins).

North American banks lead the way on revenue margin, and are even able to capture double the revenue of Swiss and European banks on their AuM. Their success can be mostly put down to higher interest rates, more transactions and higher absolute price levels.

Highly capitalized and growing US and Canadian banks may put additional pressure on Swiss and European competition if they continue to pursue international expansion in the region.

2. Executive Summary

Octagon Private Bank (OPB) prides itself as being one of the most customer focused private banks in New York City. With our luxurious atmosphere and high standards of service, our Private Banking experience is unsurpassed. Each client is treated as a prestigious partner with the utmost respect and concern.

We always strive to ensure the bank’s comprehensive financial and investment services are carefully crafted and put into effect for our client’s unique needs. Our selection of diversified investment in both broad and specialised markets enables us to manage private investors with the same proficiency available to large pension funds and corporate investors.

We also help private clients create a plan that optimises the use of their money by advising them on a selected number of products and help them get where they are going faster.  Although some clients prefer to make their own investment decisions; others are more comfortable receiving professional guidance. Whichever approach they prefer, we at Octagon Private Bank (OPB) are here to help.

At OPB we will offer investment packages, underwriting, proprietary trading, and investment management for our clients.  New York City is beneficial for several industries. Relatively low energy cost, accessible resources, north–south and east–west Interstates, international air terminals, and both west coast intercontinental railroads are all economic advantages.

OPB will be formed as a Limited Liability Company with the sole purpose of serving our clients excellently. Once we land a client, their own financial and investment aspirations, preferences and needs are effectively in control and will be the focus of the bank’s assigned and highly dedicated Associate.

Private banking at OPB is a secure haven, where clients’ dreams and ambitions set the target, their special needs decide the right tailored solutions and their financial status dictates the most appropriate financial planning leading to their targets.

To secure a financial future for our clients and their family, OPB will offer financial advice on a broad range of issues affecting the way the client live at the present and the way they want to live in the future. Clients with substantial wealth often have unique and sometimes complex borrowing needs ranging from basic credit to more sophisticated tax-optimisation strategies.

The Bank Associate coupled with a bank designated Analyst will guide our client to the solutions that best fit their needs by offering completely versatile credit products like specially structured finance with privileged terms and conditions.

3. Our Products and Services

At OPB, our services are designed for high net worth individuals and families. We offer clients professional guidance to protect and enhance their wealth. We provide them with tailored, unbiased advice and investment services – ranging from asset management to estate planning and from cash management to business planning.

It is the nature of things that with more wealth accumulated, more options, obstacles, and challenges are faced. As multiple factors are incorporated from agents to advisors, there is a need for a cohesive force to bring it all together. OPB can greatly simplify the management of client’s complex finances.

Leveraging a team of experts, we provide an objective and holistic analysis of our client’s personal financial situation that is tailored to help them grow and preserve their wealth. Octagon Private Bank will be set in a way to offer a personally tailored solution in five key areas of wealth management:

• Investment planning and asset management
• Wealth protection
• Credit planning and management
• Cash management
• Business planning (Private business owner)

4. Our Mission and Vision Statement

• At OPB, our vision is to grow into a large investment and private bank that that will provide investment advices, wealth protection, dividend income, asset and cash management, and interest income to our clients.
• Our mission at OPB is to ensure that investment decisions are implemented quickly and efficiently across all portfolios.
• To also make sure a trading research and rotation is used to avoid any type of systematic advantage or disadvantage an account may experience.

Our Business Structure

From our detailed research, we understood that for a new bank charter to be approved for us, all our senior management team are expected to have substantial experience in the banking industry.

Howbeit, all members of OPB board of directors are individuals with successful careers in a mix of business, banking, and other fields, and have representation in the necessary disciplines for the board to meet its responsibilities. We also understand the role of the board and management as investors in the bank and how important they are.

Regulators and other investors will look to the investment of these directors and senior officers as an important sign of their commitment to the bank. Knowing that a typical private bank is operated in a rigid way, more than most corporate or financial institutions, we have decided to start with the listed workforce.

Managing director

• Senior vice president

Vice president

Bank Associate

Bank Analyst

• Marketing manager
• Security man

5. Job Roles and Responsibilities

• Broaden and/or enhance the bank’s industry coverage
• Partner with the leadership to grow and build the bank
• Tirelessly work to deliver superior results to the bank’s clients
• Participate as a key member of the senior leadership team, contributing to the strategy, growth and success of the bank
• Lead efforts on sell-side and buy-side acquisition assignments, refinancing, recapitalization and restructuring assignments
• Interact seamlessly with prospects, clients, acquirers, investors and attorneys on all aspects of a M&A deal and/or capital raise
• Direct a team of junior bankers to support all elements of deal sourcing and execution

Senior Vice president

• Involved in executing and managing the actions in equity offerings that will include the drafting and structuring of material, logistics management, issue identification, its analysis and the resolution.
• Responsible for mergers and acquisitions and manages the creation of buyers list, their contacts, drafting the relevant material, financial analysis and management and is involved in private equity placement.
• Researches and identify deal opportunities by formulating and issuing factual financial analyses and creating different kinds of financial plans.
• Involved in pitching or selling the organization’s products and services to the new clients and may be involved in other projects as well.
• May participate in due diligence meetings with non-proprietary or proprietary investment managers and create relevant call reports that include their opinions.
• May be involved in analysing the investment products and screening them by making effective use of a variety of investment data and the relevant software applications
• Monitors the investment products and their performance.
• Analyses the relevant statistics to evaluate the appropriateness of the product.
• Manages relationships with the investment management organizations and regularly gets him/her updated by getting valuable information from them.
• Responsible for providing leadership and overseeing the work of subordinate members.
• Call on prospective clients such as privately held business owners, publicly traded companies and private equity banks.
• Conceptualize, organize and deliver new business presentations.
• Lead transaction implementation across industry groups.
• Manage, educate and develop private banking analysts and associates.
• Develop marketing and new business presentations.
• Monitor financial analysis and modelling.
• Perform and analyse industry research.
• Create client presentations, proposals, engagement letters term sheets, legal agreements and offer memorandums.
• Coordinate internal resources and train and develop junior resources.
• Create and foster client relationships.
• Managing and assisting in the preparation of financial models and business valuations
• Creating client marketing presentations
• Attending client meetings
• Conducting industry and company-specific due diligence related to transactions
• Drafting memoranda for sale assignments
• Assisting in the preparation of fairness opinions
• Attending drafting sessions for equity offerings
• Creating marketing materials for our equity sales organization
• Assisting in the development and continued cultivation of client relationships
• Developing an understanding of the underlying trends that affect equity capital markets
• Gaining an understanding of the interests and investment criteria of a number of middle-market private equity banks
• Development of various types of financial models to value debt and equity for mergers, acquisitions, and capital raising transactions.
• Perform various valuation methods: comparable companies, precedents, and DCF.
• Develop recommendations for product offerings, private equity transactions, mergers and acquisitions, and valuations.
• Conduct preparation and review of materials used in the financing of clients, including investment memoranda, management presentations and pitch books.
• Develop relationships with new and existing clients in order to expand the business.
• Perform due diligence, research, analysis, and documentation of live transactions.
• Create presentations for client portfolios.
• Affinity for current events, critical issues, and relevant news.

Sales and Marketing director

• In charge of organising external research and coordinating all the internal sources of information to retain the organizations’ best customers and attract new ones
• In charge of creating demographic information and analysing the volumes of transactional data generated by customer purchases
• Expected to understand, prioritizes, and reaches out to new partners, and business opportunities et al
• Tasked with understanding development opportunities; follows up on development leads and contacts
• Keep all customer contact and information
• Represents the company in strategic meetings
• Aid to increase sales and growth for the business
• In charge of the cleaning of all OPB floors
• Keep note and make sure the toiletries and supplies don’t run out of stock
• Ensures that both the interior and exterior of the bank are always clean
• Handles any other duty as assigned by the Vice president

Security guard

• The security guard is in charge of protecting the bank and it’s environs
• Also controls traffic and organize parking
• Tasked with giving security tips when necessary
• Should also Patrol around the building on a 24 hours basis
• It’s expected to give security reports weekly

6. SWOT Analysis

OPB is a family of caring partners, experts and friends our clients can trust. We believe we can only consolidate this trust through managing, growing and protecting our clients wealth in a strategic way. We have analysed our market and put together a strategic plan to ensure our bank’s success.

We believe that this plan put into consideration our opportunities, our financial and managerial resources, our prospect for success, the convenience and needs of the public, and the effect of competition on OPB. This strong business and strategic plan supported by detailed financial projections and appropriate policies and procedures form the basis of successful regulatory applications for a private bank charter.

We at OPB hope to establish a lucrative private bank that will help its clients manage and grow wealth while also ensuring profits for our investors. We took time to conduct a detailed SWOT analysis for OPB. The details and results are explained below.

At OPB, our strength rests on the expertise and experience of our management team. With the experience and discipline of our team, our SWOT analysis predict we can build a robust profile even before biding for investment, banking, and securities dealings with high net worth individuals.

As the private banking industry expands and grows in revenue and market reach, so does the level of competition in the industry. Due to the very low barriers to entry, any individual or business may register itself as an investment private bank after meeting the necessary financial requirements and basic paperwork.

• Opportunities

The private banking sector has become one of the fastest growing business sectors in the U.S. economy. Note that computerized technologies allow financial banks to operate advisory, investment banking, and brokerage services anywhere in the country.

In time past, most financial banks needed to be within a close proximity to Wall Street in order to provide their clients the highest level of service. This is no longer the case as a bank can access almost every facet of the financial markets through Internet connections and specialized trading and investment management software.

According to our SWOT analysis, the risks we will be facing include the high correlation which exists between the growth rate of the investment industry and the performance of equity markets. While evidence suggests an attractive environment for equities in the future, no forecasts can be made with absolute certainty.

Secondly, our products are measured by their performance. Although the goal is to achieve competitive performance over three to five-year time periods, short-term periods may result in underperformance based on the critical measures.

Also, beyond the third full year of operations, assets under management must produce revenues that will be sufficient to support operations in their entirety. Otherwise our options will be to acquire additional funding or to reduce costs.

7. MARKET ANALYSIS

• Market Trend

According to industry experts, wealth management and private banking players will need to adapt to a new competitive landscape, as the industry has journeyed into an unprecedented era of transparency.

Constant scrutiny from tax authorities—at a global level—has been at the origin of a significant client re-domiciliation trend, which in turn, has urged Wealth Management firms and Private Banks, notably from international wealth management centres, to follow their clients to their home countries. In parallel, a series of substantial evolutions in the cross-border environment has rocked the industry to its foundations.

Indeed, political tension has been intensifying in some regions of the world and new client types, of a more global and mobile nature, have emerged. These phenomena have led to a rise in asset volumes in cross-border markets. On top of that, in a context of fierce domestic competition, onshore players are looking for new customers in foreign markets.

Concurrently, the industry has experienced a regulatory avalanche over the last few years. Many new restrictions have been implemented, ranging from the marketing of products and services, to customer protection, distance selling, and financial advice.

Also, the fast-changing fiscal environment continues to redesign the cross-border wealth management and private banking market. This translates into additional costs and investments for the players.

Many industry experts foresee that the future of cross-border markets will be subject to further regulatory and fiscal developments. The businesses in the industry will need to demonstrate their ability to comply with such developments and to adapt their business strategies accordingly. In our view, there remains much to be done.

Our analysis at OPB shows existing challenges revolving around the value proposition delivered to cross-border clients, and more importantly, how this value can be delivered, through a combination of multi-channel interaction, appropriate product and service offerings, at a fair price, and supported by optimal operating and organizational models. At OPB, we believe that these considerations will shape the industry for years to come.

8. Our Target Market

At OPB, our target market will mostly depend on the phase of our investment product and its development cycle. Most of the marketing opportunity will happen beyond the first year of product development. But we remain very certain that some initial opportunities do exist.

For instance, our bank can utilize its transfer agent’s distribution services, which would put the product in a highly visible online platform. Note that extra opportunities include marketing to programs that invest specifically in “emerging managers.” High net worth individuals and retail marketplace will constitute a greater number of our potential clients.

We believe they can be accessed to a limited degree, even in the early stages, through similar innovative opportunities and already-established relationships with clients. Just like manufacturing organizations, investment machines like OPB are expected to develop products to provide to their customers.

Our hallmark product offering will be our well designed Market Equity strategy, an investment product offering based on the evidence supporting investor’s desires to outperform the overall market via a single, diversified vehicle and to avoid the need to create complex investment structures.

Our Competitive Advantage

There are strategic three P’s commonly associated with investment banks: People, Process, and Performance. The prior two determine the latter. Even though our business plan highlights many areas (market research, financial projections, etc.), we believe there are two areas that will surely determine the level of success achieved by OPB.

The first will be the people. Bright, energetic, talented, and knowledgeable individuals compose the core of the team we have at OPB. Outstanding and qualified investment professionals are always attracted to efficient private banks that are free from bureaucracy. Process is the second most important element of our bank.

We have made sure cutting-edge research will be provided in support of our portfolio management process. The implementation of our process is maximized by outsourcing virtually all functions not related to portfolio management and research, thereby making full use of the bank’s human capital.

9. SALES AND MARKETING STRATEGY

• Sources of Income

We believe that our primary income at OPB will come from providing our clients with professional guidance to protect and enhance their wealth. We will also offer them tailored, unbiased advice and investment services – ranging from asset management to estate planning and from cash management to business planning.

OPB will earn substantial fees for the equity and debt instruments that it underwrites and then resells to the general public. We also believe that we will engage primarily in debt instruments among middle market companies that will be sold on a best efforts basis.

This will place minimal risk on our capital reserve. We will also earn substantial per hour management and deal fees regarding advisory services. We also plan to make investments directly into marketable securities and hedge funds that specialize in specific areas of trading.

Our intention is to develop a number of trading strategies including options trading, LEAPs trading, long position/short position trading, and other methods of trading that will produce small but consistent gains on a weekly and monthly basis.

We plan to engage in a covered call strategy that would allow the fund to assure return on investment for securities that are held for an extended period of time.

10. Sales Forecast

Our plan at OPB is to turn over approximately 1/3 of our portfolio each year. This will remain consistent with an average holding period of three years. Generally, we would love for all holdings to be long-term investments. The more reason we attempt to identify stocks with which we would be comfortable with if we were “locked in” for three years.

Note that this handicaps us to look beyond short-term noise in quarter-to-quarter results and focus on the big picture, such as our management’s vision for the future and their probability of executing their plan. Also, we do realize that quick price changes, especially in volatile markets, may cause us to realize gains (or losses) sooner than anticipated.

• Marketing Strategy and Sales Strategy

At OPB, we acknowledge that the key to marketing an investment product is to create a successful and attractive product, develop a pattern of success, and show that pattern can be repeated in the future. With that, products should be aggressively marketed if capacity to manage additional assets exists.

Although a three to five-year period tends to seem like a century compared to the technology world, it is really quite reasonable especially with the fact that private equity investors in limited partnership vehicles are generally satisfied with a 10-year waiting period that exists prior to a return of their capital investment.

OPB First Century investment product will be the OPB Total Market Equity strategy and will be initially offered through an SEC registered mutual fund. Technological advancements also permit for other economically feasible distribution channels such as separately managed portfolios for large account sizes.

11. Publicity and Advertising Strategy

At OPB, we will create a long term publicity plan that will boost our brand and help us stay consistent in the industry.

That is why we have contacted the services of an Advertising Experts in business development and publicity, Lexus Channel, to help us create publicity and advertising strategies that will help us at OPB to attract and keep our target audience interested. Listed below is the summary of capable strategies detailed by Lexus Channel for our bank.

• Place adverts on both print (community based newspapers and magazines) and electronic media platforms; we will also advertise OPB on financial magazines, real estate and other relevant financial programs on radio and TV
• Introduce OPB by sending introductory letters with our business brochure to individuals, households, corporate organizations, schools, players in the real estate sector, and all the people of New York City.
• Advertise OPB in important financial and business related magazines, newspapers, TV stations, and radio station.
• Place OPB on yellow pages ads (local directories)
• Attend important international and local real estate , finance and business expos, seminars, and business fairs et al
• Create different packages for different category of clients (individuals, startups and established corporate organizations) in order to work with their budgets
• Encourage word of mouth marketing from loyal and satisfied clients
• Sponsor relevant community based events / programs
• Leverage various online platforms to promote the business. This will make it easier for people to enter our website with just a click of the mouse. We will take advantage of the internet and social media platforms such as; Instagram, Facebook , twitter, YouTube, Google + et al to promote our brand
• Place our Bill Boards on strategic locations
• Share and distribute our fliers and handbills in target areas all around New York City

12. Our Pricing Strategy

Banks in this industry aside helping clients manage and plan wealth, get funds from investors who are interested in investing, and charge them for assisting them in investing their funds over a period of time as agreed by both parties.

Even though the investment banking is a very risky venture, it is still a profitable venture hence there is an agreement between the investment bank and the client as it relates to the commission they are expected to make from the deal.

We at OPB plan to charge based on percentage and also a fixed consultancy/business administrative fee. We believe that in coming years and as we progress that we can decide to improvise or adopt any business process and structure that will guarantee us good return on investment (ROI), efficiency and flexibility.

• Payment options

We plan to make sure we provide our clients with a wide variety of payment options for our services. We understand the need and the diverse platforms different people prefer and we plan to provide a suitable platform that will suit all equally. Listed below are the payment options that we will make available to OPB.

• Payment through private bank transfer
• Payment through online private bank transfer
• Payment with check
• Payment with private bank draft

13. Startup Expenditure (Budget)

Banks like ours raise their initial capital from investors after completing regulatory processes before they can open. In the industry, all insured banks must comply with the capital adequacy guidelines of their primary federal regulator. The guidelines require a private bank to demonstrate that it will have enough capital to support its risk profile, operations, and future growth even in the event of unexpected losses.

We believe that new established private banks are generally subject to additional criteria that remain in place until the private bank’s operations become well established and profitable. We plan for an effective minimum capital of between $15 million to $25 million.

Successful capital generation in these amounts is generally the result of a well formulated and executed plan. We have analysed our needs and we plan to spend our startup funds judiciously. Outlined below is a detailed financial projection and costing for starting OPB;

• Price of incorporating the Business in the United States of America – $750.
• Our budget for basic insurance policy covers, permits and business license – $200,000
• Acquiring a suitable Office facility opposite the city hall at New York City (Re – Construction of the facility inclusive) – $75,000
• The budget envisaged for capitalization (working capital) – $30 million
• Budget for settling other legal processes (acquiring business license and all city dues et al) – $2,500
• Equipping the office with suitable and standard equipment(computers, software applications, printers, fax machines, furniture, telephones, filing cabins, safety gadgets and electronics et al) – $10,000
• Purchasing of the required software applications (CRM software, Accounting and Bookkeeping software and Payroll software et al) – $10,500
• Launching OPB official Website – $600
• Our expenditure for paying employees for 3 months plus utility bills – $36, 000
• Other Additional Expenditure (Business cards, Signage, Adverts and Promotions et al) – $4,000
• Miscellaneous: $10,000

With the above detailed cost analysis , we need $349,350 and $30 million working capital to successfully set up OPB.

Generating Funding/Startup Capital for OPB

Octagon Private Bank will be capitalized by three principal investors, Timothy Johnson, Michael Blair, and Thomas Hill. Our founders plan to become the very first financiers of the business, although we have plans of selling shares and stocks as the business matures. Due to less constraint in financing OPB Mortgages, we have outlined the few ways we can get funding and startup capital.

• Generate part of the start up capital from the five principal investors
• Agreeing to angel investors
• Apply for business loan from the Federal Reserve bank (if need be)

Note: OPB has been able to generate an enormous $15 million from its three principal investors. We have also aligned with angel investors to inject $20 million into OPB, with the hope of making profits and establishing a solid business.

14. Sustainability and Expansion Strategy

Our selection of diversified investment in both broad and specialised markets enables us to manage private investors with the same proficiency available to large pension funds and corporate investors. We will help our clients create a plan that optimises their money by advising them on a selected number of products and help them get where they are going faster.

Although some clients prefer to make their own investment decisions; others are more comfortable receiving professional guidance. Whichever approach they prefer, we will always be willing to help. Private banking at OPB is a secure haven, where client’s dreams and ambitions set the target, their special needs decide the right tailored solutions and their financial status dictates the most appropriate financial planning leading to their targets.

To secure a financial future for our clients and their family, we will always proffer financial advice on a broad range of issues affecting the way the client live at the present and the way they want to live in the future.

OPB can greatly simplify the management of client’s complex finances. Leveraging a team of experts, we provide an objective and holistic analysis of our clients personal financial situation that is tailored to help them grow and preserve their wealth.

One distinctive feature of the investment industry is that collection of fees (i.e. revenues) is highly certain because fees are frequently charged directly to the client’s accounts (or to the mutual fund). That is the more reason why revenue certainty is very high and is directly related to the amount of assets under management.

Also common practice in the investment industry is to bill at each quarter-end. For instance, our annual fee of 1 percent would be applied to our clients’ accounts five times per year at 0.20 percent.

Economic motivation is great and growth rates for the investment industry are expected to range from 30 percent to 32 percent in each of the next three years. Also, the demographic, economic, political and social evidence supporting these projections make this industry one of the most attractive industries due to the high degree of certainty in the estimates.

We believe that the certainty coupled with the above average growth rate differentiates this opportunity from other venture investments. Our near accurate estimates outline a plan-to-profitability over a period much shorter than typical venture investments that sometimes need up to ten years to make profits.

Check List/Milestone

• Business Name Availability Check: Completed
• Business Incorporation: Completed
• Opening of Corporate Private bank Accounts: Completed
• Opening Online Payment Platforms: Completed
• Application and Obtaining Tax Payer’s ID: In Progress
• Application for business license and permit: Completed
• Purchase of Insurance for the Business: Completed
• Conducting feasibility studies: Completed
• Leasing, renovating and equipping our facility: Completed
• Generating part of the start – up capital from the founder: Completed
• Applications for Loan from our Private bankers: In Progress
• Writing of Business Plan: Completed
• Drafting of Employee’s Handbook: Completed
• Drafting of Contract Documents: In Progress
• Design of The Company’s Logo: Completed
• Printing of Promotional Materials: Completed
• Recruitment of employees: In Progress
• Purchase of the Needed software applications, furniture, office equipment, electronic appliances and facility facelift: In progress
• Creating Official Website for the Company: In Progress
• Creating Awareness for the business (Business PR): In Progress
• Health and Safety and Fire Safety Arrangement: In Progress
• Establishing business relationship with private banks, financial lending institutions, vendors and key players in the industry: In Progress

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Microfinance Business Plan

NOV.05, 2023

Sample Business Plan for Microfinance

Microfinance is a banking service that provides financial assistance to low-income individuals or groups who do not have access to formal financial services. In the US, microfinancing refers to loans of $50,000 or less. Microfinance institutions (MFIs) offer loans, savings, insurance, and other products to help clients improve their livelihoods, reduce their vulnerability, and achieve their goals.

This microfinance business plan template is about a sample microfinance bank that operates in the USA. It will provide an overview of a microfinance bank’s business models, services, customer focus, management team, success factors, financial highlights, and plans. Refer to our financial advisor business plan for a detailed understanding.

Executive Summary

Business overview.

InnoLoan is a microfinance bank that provides affordable and accessible financial services to low-income individuals and small businesses in the USA. Our mission is to empower our customers to improve their livelihoods, create jobs, and contribute to the economic development of their communities.

InnoLoan microfinance bank offers a range of financial products and services to its clients, such as:

• Microloans – Tailored to the needs and capacities of our customers, with flexible repayment terms and competitive interest rates
• Savings products – Help our customers build assets and plan for the future
• Insurance products – Protect our customers from risks and uncertainties
• Money transfer – Enables our customers to send and receive money conveniently and securely
• Financial education program – Equips our customers with the skills and knowledge to manage their finances effectively

Customer Focus

Our target market comprises low-income individuals and small businesses excluded or underserved by the formal financial sector. We focus on women, youth, minorities, and rural populations facing multiple barriers to financial services. We segment our customers based on their demographic profile, income level, business activity, and financial needs.

Management Team

We have a strong management team with extensive experience and expertise in microfinance, banking, and social development. Our team is committed to delivering high-quality services to our customers and achieving social and financial impact. We also have a network of well-trained and motivated staff who work closely with our customers at the grassroots level.

Success Factors

Our success factors include:

• Clear vision and mission
• Customer-centric approach
• Diversified product portfolio
• Robust operational system
• Strong risk management framework
• Sound financial performance
• Positive social impact

Financial Highlights

Our financial highlights for the next five years are:

• Projected portfolio growth of 25% annually, reaching $50 million by 2026
• Projected customer base of 100,000 by 2026, with 60% women, 40% youth, 30% minorities, and 70% rural
• Projected revenue growth of 30% annually, reaching $15 million by 2026
• Projected net income growth of 35% annually, reaching $3 million by 2026
• Projected return on equity of 20% by 2026
• Projected operational self-sufficiency of 120% by 2026

Company Overview

Who is innoloan microfinance bank.

InnoLoan microfinance bank, established in 2020 in San Francisco, CA, is a US-registered and regulated bank that offers affordable and accessible financial services to low-income individuals and small businesses.

InnoLoan Micro Lending Company

InnoLoan micro-lending company, a branch of InnoLoan microfinance bank, gives small US businesses microloans from $500 to $10,000. It supports entrepreneurs with good business ideas or who need more capital.

Industry Analysis

The microfinance industry in the USA is a growing and dynamic sector that provides financial services to millions of low-income individuals and small businesses who are excluded or underserved by the formal financial sector. 

According to the Global Microfinance Market Research Report 2023 , the global Microfinance market reached USD 218.31 billion in 2022. The market is expected to achieve USD 447.76 billion by 2028, exhibiting a CAGR of 12.72% during the forecast period.

Here are some more interesting insights on the microfinance industry:

• There are approximately 10,000 microfinance institutions throughout the world. ( Fit Small Business )
• Microfinance institutions worldwide serve more than 140 million borrowers and have a total loan portfolio estimated at $124 billion. ( Microfinance Barometer Report )

Customer Analysis

Demographic profile of target market.

Our target market consists of low-income individuals and small businesses excluded or underserved by the formal financial sector in the USA. We estimate that over 50 million potential customers in this market segment need financial services but lack access to them. We focus on women, youth, minorities, and rural populations facing multiple barriers to financial services.

Customer Segmentation

We segment our customers based on their demographic profile, income level, business activity, and financial needs. The following table shows the characteristics and size of our customer segments:

Competitive Analysis

Direct and indirect competitors.

We face direct and indirect competition from various providers of financial services to low-income individuals and small businesses in the USA. 

Some of the direct competitors include:

• MicroVest – A microfinance institution with over $50 million in loans to 100,000 customers. It gives microloans from $100 to $10,000 at 18% interest. It also provides 2% interest savings accounts and life and health insurance.
• MicroFlex – A microfinance institution with over $25 million in loans to 50,000 customers. It gives microloans from $50 to $5,000 at 15% interest. It also provides 1% interest savings accounts and a money transfer service with a 3% fee.

Some of the indirect competitors include:

• Payday lenders – Providers of short-term loans that charge high-interest rates and fees. They target customers who need urgent cash but have poor credit history or no collateral.
• Pawn shops – Providers of loans that require customers to pledge their personal belongings as collateral. They charge high-interest rates and fees and may sell the collateral if the customers fail to repay the loans.
• Credit unions – Non-profit financial cooperatives offering their members loans, savings, and other services. They charge lower interest rates and fees than other providers but have limited outreach and eligibility criteria.

Competitive Advantage

Our competitive advantage is based on the following factors:

Marketing Plan

Our marketing plan is designed to achieve the following objectives:

• To increase our brand awareness and recognition
• To attract new customers and retain existing ones
• To expand our market share and reach by entering new geographic areas
• To enhance our competitive position and reputation

Our marketing plan consists of the following strategies:

• Product strategy – We will continuously improve our products based on customer feedback and market research. We will also introduce new products in the future.
• Price strategy – We will offer competitive and affordable prices that reflect the value and quality of our services. We will also provide incentives and discounts for loyal customers and referrals.
• Place strategy – We will leverage our existing network of branches, agents, and partners to deliver our services to our customers.
• Promotion strategy – We will use traditional and digital media to communicate our value proposition and social impact to our target market and stakeholders.

Operations Plan

Operation function.

Our operations plan describes delivering customer services and managing our internal processes. Our operations plan consists of the following functions:

• Loan origination – We assess and approve microloan applicants using interviews, credit scores, collateral, and group lending, and assist them with the application process.
• Loan disbursement – We deliver the approved loan amount to our customers via cash, bank, mobile money, or prepaid cards, ensuring speed, ease, and safety.
• Loan collection – We collect the loan repayments from our customers as per agreement, using direct debit, mobile money, or cash collection, and monitor the loan performance and contact late customers to prevent defaults and losses.
• Savings mobilization – We offer and manage savings accounts for our customers who want to save money, with good interest rates and no minimum balance, and easy access and withdrawal options through branches, agents, mobile banking, or ATMs.
• Insurance provision – We offer insurance products that protect our customers from life, health, property, and business risks, working with good insurance companies to provide cheap and customized insurance plans, and handling the claims and payments for our customers in case of loss or damage.
• Money transfer service – We offer a money transfer service that allows our customers to send and receive money locally and internationally, working with reliable money transfer operators to provide fast and secure money transfer options, and charging low fees and offering good exchange rates.
• Financial education program – We run a financial education program for our customers who want to learn more, using workshops, seminars, online courses, or mobile apps, and measuring the impact of our program on customers’ financial behavior and well-being.
• January 2024 – Launch of our microfinance bank with all the necessary licenses, registrations, and approvals
• June 2024 – Opening of 10 branches in strategic locations across California
• December 2024 – Reaching 10,000 customers with a loan portfolio of $5 million
• March 2025 – Introduction of new products such as insurance, money transfer, and financial education
• June 2025 – Expansion to new states
• December 2025 – Reaching 50,000 customers with a loan portfolio of $25 million
• March 2026 – Adoption of digital technologies such as mobile banking, online platforms, and biometric identification
• December 2026 – Reaching 100,000 customers with a loan portfolio of $50 million

Financial Plan

Our financial plan provides an overview of our key revenue and costs, funding requirements and use of funds, key assumptions, and financial projections. Refer to our bookkeeping business plan here.

Key Revenue & Costs

Our key revenue sources are:

• Interest income – The income generated from charging interest on our microloans. We charge an average interest rate of 16% per annum on our microloans.
• Fee income – The income generated from charging fees for our services. We charge an average fee of 2% per transaction on our services.
• Other income – The income generated from other sources such as grants, donations, investments, etc. We expect to receive an average of $500,000 annually from other sources.

Our key cost drivers are:

• Operating expenses – The expenses incurred for running our operations, such as salaries, rent, utilities, travel, marketing, etc. Our operating expenses will be 40% of our total revenue.
• Loan loss provision – The provision made for potential losses due to loan default or delinquency. We estimate that our loan loss provision will be 5% of our total loan portfolio.
• Capital expenditure – The expenditure for acquiring or upgrading fixed assets such as equipment, software, vehicles, etc. Our capital expenditure will be 10% of our total revenue.

Funding Requirements and Use of Funds

We require a total funding of $10 million to launch and grow our microfinance bank in the next five years. We plan to raise this funding from various sources such as equity, debt, grants, etc. The following table shows the breakdown of our funding sources and amounts:

Key Assumptions

Our financial plan is based on the following key assumptions:

• Market share – We will capture 0.2% of our target market by 2026 (100,000 customers)
• Portfolio growth – Our loan portfolio will grow at an annual rate of 25% ($50 million by 2026)
• Revenue growth – Our revenue will grow at an annual rate of 30% ($15 million by 2026)
• Net income growth – Our net income will grow at an annual rate of 35% ($3 million by 2026)
• Return on equity – Our return on equity will be 20% by 2026

Income Statement

Balance Sheet

Cash Flow Statement

Hire OGSCapital for Your Microfinance Business Plan

Writing a microfinance business plan is hard and time-consuming. That’s why you should hire us, OGSCapital. We are a team of leading business plan experts, having helped over 5,000 clients attract over $2.7 billion in financing and achieve their business goals. We have a team of experienced and qualified business plan experts and SBA business plan consultants who have worked in various industries and sectors, including microfinance. We know how to create a compelling and customized five-year microfinance business plan that will meet the expectations of your target audience.

We will also provide strategic advice, market research, financial projections, and graphic design to make your micro loan business plan stand out. Contact us for a free consultation and quote for your microfinance business plan template.

Frequently Asked Questions

How much capital is required to start a microfinance company.

In the US, you may need a minimum capital of $5 million to register as a non-banking financial company (NBFC) microfinance institution. You should have a microfinance institution business plan showing your projected income and expenses for the next five years, or refer to our loan officer business plan .

Is the microfinance business profitable?

Microfinance business can be profitable in the US if you deliver high-quality services that meet the needs and preferences of your target market. You can also use digital technologies or a payday loan business plan to manage costs and risks and show your social and financial impact.

How do I start a microfinance business?

To start a microfinance business, you must identify your target market, choose a specialty of finance, create a business plan, and comply with state and federal regulations. You also need a strategic business plan for a microfinance bank that outlines your vision, mission, goals, and strategies.

OGSCapital’s team has assisted thousands of entrepreneurs with top-rate business plan development, consultancy and analysis. They’ve helped thousands of SME owners secure more than $1.5 billion in funding, and they can do the same for you.

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How to Write a Successful Mortgage Bank Business Plan (+ Template)

Creating a business plan is essential for any business, but it can be beneficial for mortgage bank businesses that want to improve their strategy or raise funding.

A well-crafted business plan not only outlines the vision for your company, but also documents a step-by-step roadmap of how you will accomplish it. To create an effective business plan, you must first understand the components essential to its success.

This article provides an overview of the key elements that every mortgage bank business owner should include in their business plan.

Download the Ultimate Business Plan Template

What is a Mortgage Bank Business Plan?

A mortgage bank business plan is a formal written document describing your company’s business strategy and feasibility. It documents the reasons you will be successful, your areas of competitive advantage, and it includes information about your team members. Your business plan is a key document that will convince investors and lenders (if needed) that you are positioned to become a successful venture.

Why Write a Mortgage Bank Business Plan?

A mortgage bank business plan is required for banks and investors. The document is a clear and concise guide of your business idea and the steps you will take to make it profitable.

Entrepreneurs can also use this as a roadmap when starting their new company or venture, especially if they are inexperienced in starting a business.

Writing an Effective Mortgage Bank Business Plan

The following are the critical components of a successful mortgage bank business plan:

Executive Summary

The executive summary of a mortgage bank business plan is a one- to two-page overview of your entire business plan. It should summarize the main points, which will be presented in full in the rest of your business plan.

• Start with a one-line description of your mortgage bank company
• Provide a short summary of the key points in each section of your business plan, which includes information about your company’s management team, industry analysis, competitive analysis, and financial forecast, among others.

Company Description

This section should include a brief history of your company. Include a short description of how your company started and provide a timeline of milestones your company has achieved.

You may not have a long company history if you are just starting your mortgage bank business. Instead, you can include information about your professional experience in this industry and how and why you conceived your new venture. If you have worked for a similar company before or have been involved in an entrepreneurial venture before starting your mortgage bank firm, mention this.

You will also include information about your chosen mortgage bank business model and how, if applicable, it is different from other companies in your industry.

Industry Analysis

The industry or market analysis is a critical component of a mortgage bank business plan. Conduct thorough market research to determine industry trends and document the size of your market. 

Questions to answer include:

• What part of the mortgage bank industry are you targeting?
• How big is the market?
• What trends are happening in the industry right now (and if applicable, how do these trends support your company’s success)?

You should also include sources for your information, such as published research reports and expert opinions.

Customer Analysis

This section should include a list of your target audience(s) with demographic and psychographic profiles (e.g., age, gender, income level, profession, job titles, interests). You will need to provide a profile of each customer segment separately, including their needs and wants.

For example, a mortgage bank business’s customers may include individuals who are buying their first home, those who are refinancing their home, or investors looking for a property to flip.

You can include information about how your customers decide to buy from you as well as what keeps them buying from you.

Develop a strategy for targeting those customers who are most likely to buy from you, as well as those that might be influenced to buy your products or mortgage bank services with the right marketing.

Competitive Analysis

The competitive analysis helps you determine how your product or service will differ from competitors, and what your unique selling proposition (USP) might be that will set you apart in this industry.

For each competitor, list their strengths and weaknesses. Next, determine your areas of competitive advantage; that is, in what ways are you different from and ideally better than your competitors.

Below are sample competitive advantages your mortgage bank business may have:

• Extensive knowledge in the mortgage banking industry
• Commitment to customer satisfaction
• Strong management team with a wealth of experience in the mortgage banking and financial industries
• Offers a variety of mortgage products and services to meet the needs of different customers
• Highly competitive interest rates

Marketing Plan

This part of the business plan is where you determine and document your marketing plan. . Your plan should be laid out, including the following 4 Ps.

• Product/Service : Detail your product/service offerings here. Document their features and benefits.
• Price : Document your pricing strategy here. In addition to stating the prices for your products/services, mention how your pricing compares to your competition.
• Place : Where will your customers find you? What channels of distribution (e.g., partnerships) will you use to reach them if applicable?
• Promotion : How will you reach your target customers? For example, you may use social media, write blog posts, create an email marketing campaign, use pay-per-click advertising, or launch a direct mail campaign. Or you may promote your mortgage bank business via word-of-mouth marketing.

Operations Plan

This part of your mortgage bank business plan should include the following information:

• How will you deliver your product/service to customers? For example, will you do it in person or over the phone?
• What infrastructure, equipment, and resources are needed to operate successfully? How can you meet those requirements within budget constraints?

You also need to include your company’s business policies in the operations plan. You will want to establish policies related to everything from customer service to pricing, to the overall brand image you are trying to present.

Finally, and most importantly, your Operations Plan will outline the milestones your company hopes to achieve within the next five years. Create a chart that shows the key milestone(s) you hope to achieve each quarter for the next four quarters and the following four years. Examples of milestones for a mortgage bank business include reaching $X in sales. Other examples include expanding to a new location, hiring additional staff, or launching a new product or service.

Management Team

List your team members here, including their names and titles, as well as their expertise and experience relevant to your specific mortgage bank industry. Include brief biography sketches for each team member.

Particularly if you are seeking funding, the goal of this section is to convince investors and lenders that your team has the expertise and experience to execute on your plan. If you are missing key team members, document the roles and responsibilities you plan to hire for in the future.

Financial Plan

Here you will include a summary of your complete and detailed financial plan (your full financial projections go in the Appendix). 

This includes the following three financial statements:

Income Statement

Your income statement should include:

• Revenue : how much revenue you generate.
• Cost of Goods Sold : These are your direct costs associated with generating revenue. This includes labor costs, as well as the cost of any equipment and supplies used to deliver the product/service offering.
• Net Income (or loss) : Once expenses and revenue are totaled and deducted from each other, this is the net income or loss.

Sample Income Statement for a Startup Mortgage Bank

Balance sheet.

Include a balance sheet that shows your assets, liabilities, and equity. Your balance sheet should include:

• Assets : All of the things you own (including cash).
• Liabilities : This is what you owe against your company’s assets, such as accounts payable or loans.
• Equity : The worth of your business after all liabilities and assets are totaled and deducted from each other.

Sample Balance Sheet for a Startup Mortgage Bank

Cash flow statement.

Include a cash flow statement showing how much cash comes in, how much cash goes out and a net cash flow for each year. The cash flow statement should include cash flow from:

• Investments

Below is a sample of a projected cash flow statement for a startup mortgage bank business.

Sample Cash Flow Statement for a Startup Mortgage Bank

You will also want to include an appendix section which will include:

• Your complete financial projections
• A complete list of your company’s business policies and procedures related to the rest of the business plan (marketing, operations, etc.)
• Any other documentation which supports what you included in the body of your business plan.

Develop a Mortgage Business Plan

Writing a good business plan gives you the advantage of being fully prepared to launch and grow your mortgage bank company. It not only outlines your business vision but also provides a step-by-step process of how you are going to accomplish it.

Now that you know how to write a business plan for your mortgage bank, you can put together your own.  

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With our Ultimate Business Plan Template you can finish your plan in just 8 hours or less!