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How to Write a Business Plan to Start a Bank

Feb.29, 2024

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Table of Content

Bank Business Plan Checklist

A bank business plan is a document that describes the bank’s goals, strategies, operations, and financial projections. It communicates the bank’s vision and value proposition to potential investors, regulators, and stakeholders. A SBA business plan should be clear, concise, and realistic. It should also cover all the essential aspects of the bank’s business model.

Here is a checklist of the main sections that you should keep in mind while building a bank business plan:

• Executive summary
• Company description
• Industry analysis
• Competitive analysis
• Service or product list
• Marketing and sales plan
• Operations plan
• Management team
• Funding request
• Financial plan

Sample Business Plan for Bank

The following is a bank business plan template that operates in the USA. This bank business plan example is regarding ABC Bank, and it includes the following sections:

Executive Summary

ABC Bank is a new bank for California’s SMBs and individuals. We offer convenient banking services tailored to our customers’ needs and preferences. We have a large target market with over 500,000 SMBs spending billions on banking services annually. We have the licenses and approvals to operate our bank and raised $20 million in seed funding. We are looking for another $30 million in debt financing.

Our goal is to launch our bank by the end of 2024 and achieve the following objectives in the first five years of operation:

• Acquire 100,000 customers and 10% market share
• Generate $100 million in annual revenue and $20 million in net profit
• Achieve a return on equity (ROE) of 15% and a return on assets (ROA) of 1.5%
• Expand our network to 10 branches and 50 ATMs
• Increase our brand awareness and customer loyalty

Our bank has great potential to succeed and grow in the banking industry. We invite you to read the rest of our microfinance business plan to learn about how to set up a business plan for the bank and how we will achieve our goals.

Industry Analysis

California has one of the biggest and most active banking industries in the US and the world. According to the Federal Deposit Insurance Corp , California has 128 financial institutions, with total assets exceeding $560 billion.

The California banking industry is regulated and supervised by various federal and state authorities. However, they also face several risks and challenges, such as:

• High competition and consolidation
• Increasing regulation and compliance
• Rising customer demand for digital and mobile banking
• Cyberattacks and data breaches
• Environmental and social issues

The banking industry in California is highly competitive and fragmented. According to the FDIC, the top 10 banks and thrifts in California by total deposits as of June 30, 2023, were:

Customer Analysis

We serve SMBs who need local, easy, and cheap banking. We divide our customers into four segments by size, industry, location, and needs: 

SMB Segment 1 – Tech SMBs in big cities of California. These are fast-growing, banking-intensive customers. They account for a fifth of our market share and a third of our revenue and are loyal and referable.

SMB Segment 2 – Entertainment SMBs in California’s entertainment hubs. These are high-profile, banking-heavy customers. They make up a sixth of our market and a fourth of our revenue and are loyal and influential.

SMB Segment 3 – Tourism SMBs in California’s tourist spots. These are seasonal, banking-dependent customers. They represent a quarter of our market and a fifth of our revenue and are loyal and satisfied.

SMB Segment 4 – Other SMBs in various regions of California. These are slow-growing, banking-light customers. They constitute two-fifths of our market and a quarter of our revenue and are loyal and stable.

Competitive Analysis

We compete with other banks and financial institutions that offer similar or substitute products and services to our target customers in our target market. We group our competitors into four categories based on their size and scope: 

1. National Banks

• Key Players – Bank of America, Wells Fargo, JPMorgan Chase, Citibank, U.S. Bank
• Strengths – Large customer base, strong brand, extensive branch/ATM network, innovation, robust operations, solid financial performance
• Weaknesses – High competition, regulatory costs, low customer satisfaction, high attrition
• Strategies – Maintain dominance through customer acquisition/retention, revenue growth, efficiency

2. Regional Banks

• Key Players – MUFG Union Bank, Bank of the West, First Republic Bank, Silicon Valley Bank, East West Bank
• Strengths – Loyal customer base, brand recognition, convenient branch/ATM network, flexible operations
• Weaknesses – Moderate competition, regulatory costs, customer attrition
• Strategies – Grow market presence through customer acquisition/retention, revenue optimization, efficiency

3. Community Banks

• Key Players – Mechanics Bank, Bank of Marin, Pacific Premier Bank, Tri Counties Bank, Luther Burbank Savings
• Strengths – Small loyal customer base, reputation, convenient branches, ability to adapt
• Weaknesses – Low innovation and technology adoption
• Strategies – Maintain niche identity through customer loyalty, revenue optimization, efficiency

4. Online Banks

• Key Players – Ally Bank, Capital One 360, Discover Bank, Chime Bank, Varo Bank
• Strengths – Large growing customer base, strong brand, no branches, lean operations, high efficiency
• Weaknesses – High competition, regulatory costs, low customer satisfaction and trust, high attrition
• Strategies – Disrupt the industry by acquiring/retaining customers, optimizing revenue, improving efficiency

Market Research

Our market research shows that:

• California has a large, competitive, growing banking market with 128 banks and $560 billion in assets.
• Our target customers are the SMBs in California, which is 99.8% of the businesses and employ 7.2-7.4 million employees.
• Our main competitors are national and regional banks in California that offer similar banking products and services.

We conclude that:

• Based on the information provided in our loan officer business plan , there is a promising business opportunity for us to venture into and establish a presence in the banking market in California.
• We should focus on the SMBs in California, as they have various unmet banking needs, preferences, behavior, and a high potential for growth and profitability.

Operations Plan

Our operational structure and processes form the basis of our operations plan, and they are as follows:

• Location and Layout – We have a network of 10 branches and 50 ATMs across our target area in California. We strategically place our branches and ATMs in convenient and high-traffic locations.
• Equipment and Technology – We use modern equipment and technology to provide our products and services. We have computers and software for banking functions; security systems to protect branches and ATMs; communication systems to communicate with customers and staff; inventory and supplies to operate branches and ATMs.
• Suppliers and Vendors – We work with reliable suppliers and vendors that provide our inventory and supplies like cash, cards, paper, etc. We have supplier management systems to evaluate performance.
• Staff and Management – Our branches have staff like branch managers, customer service representatives, tellers, and ATM technicians with suitable qualifications and experience.
• Policies and Procedures – We have policies for customer service, cash handling, card handling, and paper handling to ensure quality, minimize losses, and comply with regulations. We use various tools and systems to implement these policies.

Management Team

The following individuals make up our management team:

• Earl Yao, CEO and Founder – Earl is responsible for establishing and guiding the bank’s vision, mission, strategy, and overall operations. He brings with him over 20 years of banking experience.
• Paula Wells, CFO and Co-Founder – Paula oversees financial planning, reporting, analysis, compliance, and risk management.
• Mark Hans, CTO – Mark leads our technology strategy, infrastructure, innovation, and digital transformation.
• Emma Smith, CMO – Emma is responsible for designing and implementing our marketing strategy and campaigns.
• David O’kane, COO – David manages the daily operations and processes of the bank ensuring our products and services meet the highest standards of quality and efficiency.

Financial Projections

Our assumptions and drivers form the basis of our financial projections, which are as follows:

Assumptions: We have made the following assumptions for our collection agency business plan :

• Start with 10 branches, 50 ATMs in January 2024
• Grow branches and ATMs 10% annually
• 10,000 customers per branch, 2,000 per ATM
• 5% average loan rate, 2% average deposit rate
• 80% average loan-to-deposit ratio
• $10 average fee per customer monthly
• $100,000 average operating expense per branch monthly
• $10,000 average operating expense per ATM monthly
• 25% average tax rate

Our financial projections are as per our:

• Projected Income Statement
• Projected Cash Flow Statement
• Projected Balance Sheet
• Projected Financial Ratios and Indicators

Select the Legal Framework for Your Bank

Our legal structure and requirements form the basis of our legal framework, which are as follows:

Legal Structure and Entity – We have chosen to incorporate our bank as a limited liability company (LLC) under the laws of California.

Members – We have two members who own and control our bank: Earl Yao and Paula Wells, the founders and co-founders of our bank.

Manager – We have appointed Mark Hans as our manager who oversees our bank’s day-to-day operations and activities.

Name – We have registered our bank’s name as ABC Bank LLC with the California Secretary of State. We have also obtained a trademark registration for our name and logo.

Registered Agent – We have designated XYZ Registered Agent Services LLC as our registered agent authorized to receive and handle legal notices and documents on behalf of our bank.

Licenses and Approvals – We have obtained the necessary licenses and approvals to operate our bank in California, including:

• Federal Deposit Insurance Corporation (FDIC) Insurance
• Federal Reserve System Membership
• California Department of Financial Protection and Innovation (DFPI) License
• Business License
• Employer Identification Number (EIN)
• Zoning and Building Permits

Legal Documents and Agreements – We have prepared and signed the necessary legal documents and agreements to form and operate our bank, including:

• Certificate of Formation
• Operating Agreement
• Membership Agreement
• Loan Agreement
• Card Agreement
• Paper Agreement

Keys to Success

We analyze our market, customers, competitors, and industry to determine our keys to success. We have identified the following keys to success for our bank.

Customer Satisfaction

Customer satisfaction is vital for any business, especially a bank relying on loyalty and referrals. It is the degree customers are happy with our products, services, and interactions. It is influenced by:

• Product and service quality – High-quality products and services that meet customer needs and preferences
• Customer service quality – Friendly, professional, and helpful customer service across channels
• Customer experience quality – Convenient, reliable, and secure customer access and transactions

We will measure satisfaction with surveys, feedback, mystery shopping, and net promoter scores. Our goal is a net promoter score of at least 8.

Operational Efficiency

Efficiency is key in a regulated, competitive environment. It is using resources and processes effectively to achieve goals and objectives. It is influenced by:

• Resource optimization – Effective and efficient use and control of capital, staff, and technology
• Process improvement – Streamlined, standardized processes measured for performance
• Performance management – Managing financial, operational, customer, and stakeholder performance

We will measure efficiency with KPIs, metrics, dashboards, and operational efficiency ratios. Our goal is an operational efficiency ratio below 50%.

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Are you looking to hire business plan writers to start a bank business plan? At OGSCapital, we can help you create a customized and high-quality bank development business plan to meet your goals and exceed your expectations.

We have a team of senior business plan experts with extensive experience and expertise in various industries and markets. We will conduct thorough market research, develop a unique value proposition, design a compelling financial model, and craft a persuasive pitch deck for your business plan. We will also offer you strategic advice, guidance, and access to a network of investors and other crucial contacts.

We are not just a business plan writing service. We are a partner and a mentor who will support you throughout your entrepreneurial journey. We will help you achieve your business goals with smart solutions and professional advice. Contact us today and let us help you turn your business idea into a reality.

Frequently Asked Questions

How do I start a small bank business?

To start a small bank business in the US, you need to raise enough capital, understand how to make a business plan for the bank, apply for a federal or state charter, register your bank for taxes, open a business bank account, set up accounting, get the necessary permits and licenses, get bank insurance, define your brand, create your website, and set up your phone system.

Are banks profitable businesses?

Yes, banks are profitable businesses in the US. They earn money through interest on loans and fees for other services. The commercial banking industry in the US has grown 5.6% per year on average between 2018 and 2023.

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How to Start a Bank: The Complete 7 Step Guide (2024)

February 11, 2021

It’s likely no surprise to learn that one of the most profitable businesses around is banking. The United States alone has the largest financial marketplace, and according to a report by SelectUSA. , the financial services industry (which includes banks, investment services firms, and insurers) represents 7.4 percent, or 1.5 trillion dollars, of the U.S. gross domestic product. For those who are willing to scale significant barriers to entry, the rewards for opening a bank are great.

Regulations and capital are the two biggest hurdles to jump, and to be clear, starting a bank is not an easy endeavor, particularly for those unfamiliar with the industry. But with a solid, well-devised business plan and strategy, a pile of sweat equity, plentiful stores of patience, and a dash of good fortune, starting your own bank is possible. 

This article will show you the necessary steps to opening your own bank. We’ll explore how to determine a need and a target market, detail the elements of a good business plan that will provide the platform for your success, show you the regulations you’ll need to comply with and how to meet them, and outline the staff you’ll need to hire to provide excellent customer service and build your bank’s reputation.

Case example: Bank of America

Bank of America is a global giant with 66 million customers and operations in 35 countries worldwide. But like most multinational corporations, BoA’s story of success began with a single founder with a vision.

Bank of America actually started life as the “Bank of Italy” (surprisingly enough) when Italian immigrant Amadeo Giannini founded the bank in San Francisco in 1904. Giannini’s objective was to offer banking services to other Italian immigrants and to middle-class Americans who were often denied accounts by the larger financial institutions of that time. 

Providing banking for customers who didn’t already have it was the need that Giannini’s new bank met, and he quickly gained customers from all ethnic backgrounds. His clientele mirrored the “melting pot” of early 20th century America, and so it was appropriate for him to rename his bank “Bank of America”.

It was also a bold vision that eventually became reality. Through mergers and acquisitions, Giannini’s humble bank became the U.S.’s largest bank and a global financial powerhouse in under a century. If you aspire to build such an impressive bank, start by learning to develop a business mindset.

Your startup bank may never reach those heights, but the Bank of America story is proof that a broad, bold vision backed up with excellent customer service and exemplary corporate management can help a new bank transcend humble origins and become a dominant industry player.

You can write your own success story in banking by following these steps.

Step 1: Know the Business

Most of us are familiar with banking on some level, whether it be through checking and savings accounts, mortgages or loans, credit cards, retirement accounts, or insurance policies. But behind the ATM machine or the drive-thru window are a whole host of complicated transactions that in aggregate ensure that the bank not only has money for you to withdraw, but that as a business entity, it is making a profit.

If you haven’t worked in some level of the financial services industry, it’s important to get some industry experience, some specific education in finance, business, or both, and some expert guidance and advice.

There’s no better resource than UpFlip business courses  taught by successful business owners.

How do banks make money?

Very simply, banks make money off of the money that their customers deposit into it. Banks take deposits and loan the money out to customers, charging interest on these loans.

Banks also typically pay depositors a small amount of interest for their deposits (and will pay higher amounts of interest for long-term deposits, such as a certificate of deposit (CD)). 

The difference between the higher rates of interest charged to borrowers and the lower rates of interest paid to depositors is known as the interest spread, and this is the major component of bank profits. 

Governments often incentivize loans to certain groups, like loans to women-owned businesses .

Other sources of profits include fees charged for various services and ancillary financial services like retirement accounts and insurance policies.

More and more banks are offering a full menu of financial services because they are a good source of revenue and profits with little risk.

Fractional reserve banking

The overwhelming majority of banks in the U.S. operate as fractional-reserve banks. This means that at any one given time, 10% of the bank’s deposits must be available for withdrawal.

This 10% of the deposit revenues is known as the fractional reserve. For instance, for every $100 that a customer deposits, the bank may use $90 to lend out to other customers (or to you, for that matter).

Low fractional reserves allow the circulation of money throughout the economy as measured by a factor called the economic multiplier, and since low fractional reserves open the money supply available to borrowers for things such as homes and cars, they are seen as instruments to maintain prosperity and a healthy national economy. 

In fact, to maintain a healthy economy in response to the coronavirus pandemic, the Federal Reserve took the unprecedented step to reduce the fractional reserve requirement to zero on March 26, 2020.

The concept of fractional reserve means that banks are counting on depositors holding the majority of their funds in their accounts and not withdrawing them all at once. 

Most of the time, this is what happens. But when depositors start to withdraw from their accounts in response to a financial crisis or panic, this is known as a bank run , and they can cause the bank to become insolvent and go out of business. 

Creation of the FDIC

Bank runs happened at the start of the Great Depression in the U.S., and as a result, the federal government instituted a number of regulations and insurance requirements through the Banking Act of 1933 , signed into law by President Franklin D. Roosevelt. 

The Banking Act of 1933 created the Federal Deposit Insurance Corporation ( FDIC ), which is the regulator for the U.S. banking industry, and it guarantees consumers’ checking and savings accounts up to $250,000 in the event of bank insolvency.

Banks spread out their risk of bank runs by accumulating large numbers of depositors. Low or non-existent fractional reserve requirements have fueled the growth of large national or multinational banks. 

Again, this is mostly a good thing for the economy, but for a smaller community-based bank, particularly in a location with a single dominant industry or employer, the risks of a bank run and the ensuing insolvency and failure are much greater. This is definitely something to consider as you start your new bank.

De novo banks

Start-up banks in their first five years of operation are known as de novo banks, from the Latin word for “new”.

In addition to the economy of scale advantages that large banks enjoy, there are a couple of significant barriers to entry that new bank entrepreneurs must scale. These are 1) regulation, and 2) capitalization.

Banking is the most regulated business in the United States. According to independent banker , before the 2008 financial crisis, an average of 172 de novo banks opened each year. Since that watershed year, the number dwindled to almost nothing. A large reason for this is the greater number of regulations that banks must comply with to even open for business.

The FDIC is the regulatory agency for all banks in the United States, and their website provides information and the necessary forms that de novo banks must submit.

Once the application is in place, expect to wait anywhere from one year to eighteen months for approval.

Capitalization

The FDIC requires that de novo banks have anywhere from 12-20 million dollars in startup capital. The bank must prove that it can withstand initial losses and economic downturns and that it will operate ethically.

Underfunded de novo banks are more prone to cutting corners, and so the more startup capital you can bring to the table, the more likely it will be that the FDIC approves the bank’s application.

Can I start a bank with no money?

In theory, yes, but you’d better have friends with deep pockets and in high places. Because of the lofty capitalization requirements, most banks are formed as corporations run by a board of directors, whose investors are often local business or community leaders.

Another source of startup capital is from venture capitalists, who will invest in the bank for a share of its profits.

Step 2: Write a business plan

As the saying goes, if you fail to plan, you plan to fail.

For a business like banking that involves such high regulatory and capital hurdles, a well-devised plan of action that addresses all the salient aspects of the business is essential for its success.

The document that details this plan of action is the business plan, and once you have some knowledge of and experience in the banking industry, writing your de novo bank’s business plan is the next big, critical step to take.

Your business plan is your venture’s founding document, like a constitution or the Bible, and it will be the reference point for all business decisions moving forward. For this reason, it’s important to spend great time and effort composing the business plan, and a well-written one will make business success much more likely.

Luckily, there are some good resources for entrepreneurs who are writing their own business plan, and perhaps the best one out there is the Small Business Association (SBA) of the federal government, who have their own step-by-step guide to writing your business plan.

Bank of America has their own guide to writing a business plan , with an emphasis on the financials, as you might expect.

Chron has a step-by-step guide to writing a business plan for a bank, and banking software company BMA Banking Systems also has a comprehensive guide to writing a plan for a de novo bank.

And business writer and startup guru Jeff Haden has his own excellent guide to writing a comprehensive business plan at Inc.magazine .

Trust and reputation are important for a bank, and these can be difficult to build when you’re starting from scratch. One option is to buy an existing bank that’s already built a reputation in the community.

When you apply for FDIC approval and insurance, they will examine your business plan closely, to make sure you will meet regulations and follow banking industry best practices.

Here are elements that your plan should address:

How will it make money?

We’ve discussed the two primary ways banks make money: through the interest spread, and through fees charged to customers. But as also discussed, there are products like investments and insurance that are becoming a part of the menu of offerings of more and more banks.

Whether you put all of your eggs in the basket of traditional services like checking and savings accounts and loans, or whether you offer a broader financial services portfolio, most banks yield about 10-15% net profit, with 7-10% return on investment or equity.

As a de novo bank, you are not likely to achieve these levels until you’ve been in business for a few years, which is one reason the FDIC requires sufficient capitalization.

What is the target market?

Your target market is an important consideration for your new bank, and it’s related to your scope of business. For instance, if you’re targeting a younger generation of customers, you’ll need to have a big online presence and mobile banking capability.

If you’re targeting older customers, perhaps retirees, mobile banking may be less of a consideration, but convenient branch locations with easy access and plentiful parking become critical.

Another consideration to make is whether you want to target small business firms by offering business banking, or whether you want to focus more, or solely, on consumer banking.

It can be hard to accurately describe your market, but it’s a critical assessment to make. Market research firms can gather data that either confirm or deny your own intuitions and can help prevent you from making poor decisions early on. For these reasons, it’s worth considering hiring one.

You can find a guide to market research for new businesses at Entrepreneur . And Joe Gardiner, CEO of VentureDevs , has a complete guide to market research at Forbes .

Brick-and-mortar or online-only?

Banks that are online-only , such as Chime and Ally, are a growing presence in the banking and financial services industry.

Most banks are a combination of brick-and-mortar branches with an online banking counterpart, but the extent to which each element is promoted depends on the banking habits of your customer base. 

Online-only banks save on infrastructure costs, but when starting your online bank, don’t forget to consider the enhanced cybersecurity costs you’ll incur.

And if you think that by opening a bank as an online-only business you’ll escape the regulatory scrutiny that brick-and-mortar banks endure, think again. The same charter and regulatory code that storefront banks operate under also applies to online banks.

In addition to these laws, you’ll also have to comply with other regulations designed specifically for online banking. These regulations were devised by an organization called the Federal Financial Institutions Examination Council (FFIEC), and are listed in this guide to online banking .

Define your business structure

Because in almost all cases your bank startup costs will be underwritten by a team of investors, the corporation is the prevailing business structure in the banking industry.

You’ll need to register with your state’s corporation commission or board, but beyond this, you’ll need to consider how the initial board of directors is chosen, what their terms of engagement will be, their compensation (if any), and how often they will meet (your state may mandate a minimum number of yearly meetings). 

You might want to hire a law firm to form your corporation because it’s easier to head off any problems as the business is formed than it is to go back and change your founding documents or business protocols once issues arise.

Choose your name

Your bank name can reflect your geographic origins, or it can be more abstract, or even the name of one of its founders. An example of the former is Bank of America, and an example of the latter is Chase.

Choosing your bank name is an important consideration that can affect both the present and future of financial institutions.

For example, naming your bank the Bank of North Carolina may attract customers in your home state that want to do business with local financial institutions, but it may also hinder your expansion if you want to open branches in, say, Florida. Choose wisely.

For some help with choosing a name for your business, Forbes has a guide, as does The Balance. Shopify even has a tool that will generate a business name and claim the domain for you.

Once you’ve determined your bank name, run searches at your state corporation’s website and also do a WHOIS domain name search via a service like ICANN . The latter is critically important for online banking because having your bank name and website different can be devastating for business.

ICANN can also tell you if somebody currently owns the domain name you seek and what they will charge to sell it to your business.

Address start-up and operations costs

Your plan should outline the source(s) of your capital and how and when these investors will be paid back. Your operations costs must also be carefully outlined, and the FDIC will look at your plan to ensure that operations costs are realistic and not underestimated. For a bank, there are three main sources of operations costs:

1) Regulatory/legal compliance

Almost all established banks have attorneys on staff to assist with legal and regulatory compliance, and even as a de novo bank, you should enlist the services of a lawyer.

The fines for non-compliance can be severe and far exceed legal fees. Non-compliance can also place the bank’s future in jeopardy.

KYC and AML compliance

KYC (Know Your Customer) and AML (Anti Money Laundering) regulations exist to make sure that banks are doing business with legitimate entities, and not criminal organizations.

In essence, AML mandates KYC, which is verified through having account holders submit documentation before opening accounts.

KYC and AML protect the banks from criminal liability, but adherence to these regulations isn’t cheap. “A key part of starting any financial institution is ensuring you have proper procedures set up to meet KYC and AML compliance obligations,” says Greg Pinn, Sr. Director of Merlon , which produces automated systems for regulation compliance.

“Banks can spend as much as 2.5% of their operating expenses on AML compliance, a huge expense for any bank starting out. Setting up these programs correctly can reduce that expense by a significant amount,” he says. KYC3 has a helpful guide to understanding KYC and AML compliance and the implications for startup banks.

2) Security

A brick and mortar bank branch needs a secure vault, security protocols for armored car cash deliveries, electronic security systems for the building, and sometimes armed guards on site.

Given these costly measures, it might seem like online banks have it easier in terms of security costs.

This isn’t necessarily the case, however: A 2017 survey conducted by Kaspersky Labs and B2B International found that a cybersecurity incident that involves online banking services costs a bank 1.75 million dollars on average.

The American Banker’s Association has some information about cybersecurity risks and some helpful links to resources for cybersecurity for small businesses in general and banks in particular.

No bank can be a sole proprietorship. Even a small bank requires a minimum of ten employees, and most banks have more than 20 full-time employees working for them. Among the types of employees banks require are:

• Bank managers
• Bank Tellers
• Personal Bankers
• Investment Consultants
• Accountants

Beyond the operations staff you’ll need for day-to-day operations, you’ll need to carefully select a management team of individuals that includes women and minority representation. This management team will be carefully scrutinized by the FDIC during the approval process, and all the members should share vast knowledge and experience in the banking and financial services industry.

Hiring competent and experienced staff that share your vision is a critical step to take, and one that requires significant thought, time, and energy. 

Chinese business magnate Jack Ma writes, “You’ve got to make your team have value, innovation, and vision.”

McKinsey and Company , as well as the American Bankers Association, both offer helpful guidelines for selecting your management team and employees.

How much does a bank owner make?

According to CareerTrend , a president/owner of a small bank of less than 200 employees earns between $96,000 and $194,000 per year. This compensation is normally a combination of a base salary, profit-sharing, sales commissions, and bonuses.

Step 3: Raise capital

After knowledge and experience has been gained, and a solid plan for the business has been developed and written down, it’s time to start putting the pieces together.

The hardest step is usually coming up with the capital that the FDIC requires. 

As for most businesses, adequate capital keeps the bank afloat during crises and hard times, and somewhere between 20-40 million dollars of capitalization is normally required just to get out of the gate and start doing business. More is better.

Most individual entrepreneurs don’t have access to this kind of capital, so you’re going to need to build a team of investors.

If you’ve had a career working for another bank, you may know colleagues who have expressed an interest in starting their own bank, so reach out to these people (but also be aware of non-competitive clauses in their current employment contracts).

Community leaders

If your bank will be serving a particular community or business/industry, reach out to community leaders and business owners.

If you know these leaders from your previous career working for an established bank, they will be more willing to work with you because they know your personal qualities, integrity, and excellent reputation. 

Community leaders in particular may be interested in creating a bank that is headquartered locally and which specifically serves local customers.

Even in the 21st century, this sort of provincialism attracts new account holders and drives customer loyalty.

But if these sources of investors don’t yield the capital that you’ll need for your new bank, you’re going to have to approach venture capitalists.

Venture Capitalists

The good news is that due to the regulatory scrutiny that banks face just to open their doors, the banking industry is a relatively low-risk investment for venture capitalists.

The flip side is that you’ll have to share the profits of your bank for many years to come with your investors, but banking is also, in general, a high-yield business, so you won’t have to take an oath of poverty while paying back venture capitalists. For an excellent overview of how venture capitalists work, read this article in the Harvard Business Review. Oracle NetSuite also offers a comprehensive guide to attracting venture capitalists that includes a downloadable e-book.

Step 4: Get a charter

According to the Federal Reserve , a de novo bank must operate under either a federal or state charter. A charter is a legal document that authorizes the bank to conduct business.

A charter includes the bank’s articles of incorporation and certificate of incorporation, which is usually issued by the state corporation commission. 

Charters can be issued at the federal level by the Office of the Comptroller of the Currency (OCC), or by the state (and including the District of Columbia, Guam, Puerto Rico, and the Virgin Islands) in which the bank is incorporated, usually through its banking commission. 

As with the FDIC application, federal and state charter offices will carefully evaluate the bank’s business plan, executive team, board of directors, and capitalization amount.

Step 5: Apply for FDIC approval

The Federal Deposit Insurance Corporation (FDIC) evaluates, and upon approval, insures and sanctions every new bank in the United States. Required elements of the application and necessary forms are available at the FDIC website . These are the necessary elements:

• Mission Statement
• Business Plan
• Financial projections for a minimum of three years
• Policy descriptions for loans, investments, and insurance

Obtaining both the bank charter and FDIC approval takes some time—a minimum of 12 months, and as much as 24 months. While you are waiting for approval to come through, you can move on to address the succeeding steps.

Step 6: Check for any other necessary permits

Most bank charters are a sanction for the bank to conduct business, but there may be additional necessary permits or local zoning laws to comply with. The Small Business Association’s website offers easy ways to check for required state and local licenses and permits for your business:

• State – You’ll need to visit your state’s website for specific information on what permits you’ll need to start a bank there. Almost all states will require a charter, and even if it is a national charter, you’ll likely have to apply for a license through the state agency that issues bank charters. If you have some flexibility where to locate your new bank, you can visit a page at the SBA site that gives some helpful tips on how to choose where to locate your business.
• Local – Again, localities vary widely with the number of regulations that all new businesses, and especially banks, require. The general rule of thumb is that the larger the population and the amount of businesses in your location, the more permits and paperwork are required. If you have a local SBA office, visit them for advice and assistance.

If you are opening a brick-and-mortar bank, you’ll often need to acquire a   Certificate of Occupancy . The CO certifies that all local zoning laws and building codes have been followed.

If you are renting a building, the landlord is usually responsible for the CO.

Step 7: Get customers

With all the regulatory compliance that starting a bank involves, it’s easy to lose sight of the end goal of any business: attracting and retaining new customers.

Getting customers through your new bank’s doors (or to its website) requires differentiating yourself from your competition. 

Create your brand

One of the best ways to attract new customers is by creating a memorable brand image through an effective branding campaign. 

Branding is the process through which a company’s mission, values, and image enters the public consciousness. 

Get a good logo

Successful branding begins with a good logo that represents the company effectively and in a simple, easily memorable manner.

Getting the logo right is an important step towards corporate success, and if you are not a natural artist or computer graphics expert, plenty of firms offer logo design for reasonable rates. It’s a worthy investment of resources towards a bright future for your new bank.

Advertise your brand

Successful advertising happens in both traditional and social media.

The correct answer to which media you advertise in is “all of them,” but the target audience that you defined in your business plan will dictate which media forms you focus your advertising budget on. 

Gain a social media presence

Younger consumers will tend to favor social media . Ellen McGovern, chief marketing officer at Massachusetts-based Clinton Savings Bank, explains the need to be on social media to attract and retain younger customers in an article at American Banker :

One of the most effective networks of promotion for this younger generation of customers is social media influencers.  

In the same article, Molly Young, product marketing manager at partnership automation company Impact , explains the marketing power of influencers: 

Don’t neglect traditional forms of advertising

If the newer generation of bank customers prefers the influencer network, then older consumers choose traditional media like newspapers and TV, and you certainly can’t afford to alienate this important market segment. So a full portfolio of a combination of new and traditional media is in order.

The best way to determine which media reach your targeted audience is to request a media kit from prominent local media outlets.

The best media kits will offer detailed audience information that will allow you to select those outlets whose audience most closely matches your target consumer base.

Determine your competitive advantage

Branding and advertising can all be for naught if your bank’s competitive advantage is not clearly defined. A competitive advantage is a unique service, perk, or reward that differentiates your business from others. 

Banking is a very competitive industry with large players that have thousands of branches across the country and an economy of scale that allows large banks to waive many fees and offer higher interest yields on checking and savings accounts. 

If you can’t match the large banks on price, then perhaps your small, community-based bank can offer personalized, custom accounts to meet individual consumers’ needs, or offer free financial literacy classes for their account holders.

Links to resources about business marketing

Several other articles couple be written about marketing, advertising, and PR for your new bank, but there are a couple of excellent articles that focus specifically on getting customers. Forbes offers ten ways to get customers to your new small business, and Inc. offers the same, with a focus on also increasing your sales.

For a good primer on using influencer marketing, check out this article from The Financial Brand .

Once you have customers, the competition in the financial industry means that pleasing and keeping your base of customers is also essential for success. 

Jim Marous, Co-Publisher of The Financial Brand says, “Bottom line, having a customer-centric culture is more than just a good thing—it’s become a matter of survival.”

Business/Fintech influencers to follow on social media:

• Sebastien Meunier Twitter LinkedIn
• Bradley Leimer Twitter LinkedIn
• Brett King Twitter LinkedIn

Video Resources

• Khan Academy’s Introduction to Banking
• Building a Bank by MIT Bootcamps
• Banking Explained – Money and Credit
• How to Write a Business Plan by Young Entrepreneurs Forum
• How to Start a Business by Sir Richard Branson

Starting a bank requires a high level of knowledge, a good amount of industry experience, and a lot of patience and determination to deal with the charter and FDIC approval process. It also requires an enormous amount of capital.

For these reasons, starting a bank is not recommended as your first entrepreneurial venture, but more as a capstone to a successful career in banking and financial services.

For those who successfully scale the formidable barriers to entry, the financial rewards can be great. But for many community bank owners, the real reward is in providing an essential institution that ensures the financial well-being of their community.

British business titan Sir Richard Branson sums up the essential purpose of any business: “A business is simply an idea to make other people’s lives better.”

80% of businesses fail... Learn how not to.

Learn from business failures and successes in 5 min or less. The stories, frameworks, and tactics that will make you a 10x better founder.

Matthew Butterman

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Asana vs Monday: Detailed Comparison (2024)

• Initial Setup
• Core Features
• Integrations
• Our overall opinion.

Asana vs Monday: Initial Setup

Asana initial setup.

• Naming the project
• Creating the checklist
• Method of marking progress
• Selecting the preferred project layout 
• Inviting team members
• Downloading the project management tool on devices

Monday Initial Setup

Monday vs asana core features.

• Different types of boards 
• Automations
• File Storage

Monday Features 

• Dashboards : This feature makes it easy to view relevant information in one place, but it’s not really intuitive. For instance, the numbers widget is really a single-number widget. You’ll have to create a different one for each number you want to track.
• Automations : I find the Monday automations difficult to set up exactly as I want. Finding the best way to write each automation can be challenging. I prefer visual process automations. These are not available in the free plan.
• Integrations : Like Monday automations, the integrations are not free. They also have some bugs that I wasn’t able to solve in a timely manner. I discussed them more in our Monday.com review.
• Gantt : This project management tool is the basis of measuring project timelines and success. I personally love these because they make it easy to view the project. The picture below shows the single project template from Monday.
• Kanban : Another way to track tasks is Kanban. It’s great for high-level overviews but lacks the ease of viewing dependencies that project managers may want. The single project template doesn’t include automation that could make it easy for automated task updating, so you’ll have to create them yourself.
• Work Docs : This feature can be used for anything from creating blog content to making checklists. The functionality is good. It’s honestly the most user-friendly portion of Monday project management software.
• Files : Files are where you can attach anything related to the task, person, or project so that anyone viewing them can also view the files. Oddly, this isn’t a default column in any of the templates I’ve used.

Asana Features

• Asana’s workflow builder uses a more logical automation process. 
• Integrations are not standardized in Asana. Some are super simple and make lots of sense, some are more complex, and some don’t seem to work. Asana should really standardize how their integrations work. The Canva and Asana one is literally explaining manual workflow management. That’s not an integration.
• The reporting generates a default report based on what you’ve created in Asana. You can also create custom reports. I like how easily this works. Here’s my default one.

Monday.com vs Asana Integrations

Monday integration and automation.

Asana Integrations and Automations

Monday.com versus Asana Security

Asana security features.

• All systems are SOC2 and SOC3 compliant.
• Accounts are General Data Protection Regulation (GDPR) and California Consumer Protection Act (CCPA, upon request) compliant. 
• Asana is ISO certified.
• Backups are performed daily to protect against data loss.
• Asana provides options for specialized compliance tailored to financial, healthcare, or educational companies with the Enterprise plan.
• Enterprise plans can use Single Sign-On, 2-Factor Authentication, and other controls to protect the system.
• A team of security experts continually improves the system.
• Bug Bounty Program that rewards up to $6,500 for vulnerabilities detected.

Monday.com Security

• All systems are SOC1, SOC2, and SOC3 compliant.
• Monday is ISO certified.
• Backups are performed every five minutes to protect against data loss.
• Financial, healthcare, and educational companies can use Monday tailored for their compliance needs with the Enterprise plan.
• Works with PrivacyTeam to support security efforts.
• Users can report security flaws by submitting this form . This is also part of a Bug Bounty Program.
• Advertises it is on AWS and Google Cloud, which means they have cyber security experts from multiple agencies monitoring their security 24/7.

Asana vs Monday.com Support

Monday Support 

Asana support.

Asana or Monday: Usability

Asana vs monday pricing, how much does asana cost.

What is the price for Monday.com?

• Basic : $10 per user each month with a 3-user minimum
• Standard : $12 per user each month with a 3-user minimum
• Pro : $20 per user each month with a 3-team members minimum
• Enterprise : Contact Monday.com for a quote

Monday or Asana Apps

• Asana Download Page
• Monday.com on Android
• Monday.com on iOS

What Can I Use Instead of Monday.com?

• ClickUp , which we use at UpFlip. 
• Jira , which I’ve used with software development clients. I don’t personally like it as much, but Atlassian makes a whole suite of other tools that work really well with it for managing projects.

Which Is Best Monday.com or Asana?

Why is Asana the best?

Why is monday.com the best, is monday same as asana, asana vs monday conclusion.

• Gantt charts
• Kanban boards
• Two-factor authentication
• Timeline view
• Calendar view
• Integration with Google Drive
• Ability to attach documents to different tasks and projects

How to Start an Advertising Agency (and Make $500K/Year)

One of the hottest industries to start a business in is the tech industry—more specifically social media marketing.

We're going to walk you through the process of how to start an advertising agency so you can begin your path to success in digital marketing.

We talked to Jason Yormark, founder and Chief Social Officer of Socialistics , about how he started his company and has 4x the revenue since starting it 2.5 years ago.

He started off with Microsoft then started blogging during a year layoff before getting hired back.

He started the Socialistics advertising agency as a side project but has grown it to managing $2-5K social media marketing campaigns for 15 clients, including Habitat for Humanity and the U.S. Air Force .

We'll give you everything you need to know when starting an advertising agency, including an overview of the industry, developing the business concept, getting all the licensing/business requirements, commonly asked questions about advertising and marketing, strategies for launching, and business operations. 

Throughout, we'll provide input from Jason and myself on what we have found that works and doesn't work. Keep reading to find out more.

Advertising Industry Overview

Business owners in all industries need marketing. Most small businesses don't have the time and knowledge to run their own ad campaigns, so there's a ton of opportunity for starting a new business in marketing or advertising.

Let's start by discussing the state of the industry. Because of the global pandemic, marketing spending dropped to $1.28 Trillion in 2020 according to PQ media . Jason experienced a drop in revenue which he attributes to:

I saw similar results in my marketing and blogging business from February through September of last year and then spending started ramping up again.

This year I've been getting approximately 3x the requests of previous years, which I attribute to my business maturing, combined with more business confidence.

Despite a drop in overall spending, according to Beroe Inc , global digital marketing was between $330-340 billion in 2020 and grew almost 13% over 2019.

Meanwhile, spending on legacy advertising formats like TV, billboards, and radio declined by 30%.

According to Safe Frog Marketing Group (through Hubspot), nearly 2/3 of companies hire an advertising agency or freelancer to manage part of their digital marketing needs. 

Combine this with the number of marketing companies staying the same ,and spending on advertising expected to increase by 8-15% according to Forbes , this is the perfect time for starting an advertising agency.

One of the opportunities Jason told us about in digital advertising is the ability to attract potential clients with reduced retainers. Here's what he had to say,

Major Advertising Agencies and Other Competitors

Globally, the 50 largest marketing/advertising agencies make over $460 million in revenue or more. The top ad agency, Accenture Interactive made over $4.4 Billion in 2018. Wow! They are killing it! If you want to see the full list check out this article by Agency Spotter.

According to IBIS World , there are 5,585 digital advertising agencies in the United States, so there is a ton of competition, but plenty of revenue to start your own agency and work for your ideal client.

I did a little estimation of what the average marketing agency makes based on these numbers, and it's around $20 million.

Granted, some aren't going to be anywhere near this, but even if you are making $75,000+ working from home as a one-man company, that's not bad money.

Currently 2 years in, I make enough working part-time to pay the bills without stressing. It's not nearly what Jason estimated:

Inspiration for Starting an Advertising Agency

The first step when you want to start an ad agency is to conduct research to determine what is right for you. Your marketing company should be focused on satisfying your potential client's marketing needs while utilizing your current skill base. 

You may want to start a marketing company focused on a specific niche, such as Business to Business (B2B) or Business to Customer (B2C), a general marketing company, or you may want to start a digital marketing firm focused primarily on a specific social media network like Facebook.

You aren’t limited to just one type, but this decision will impact how to start a media company. This decision will drive every move going forward.

Some of the common types of marketing companies are:

• Social Media Marketing - Focused on marketing through social media 
• Email Marketing - Email-based marketing
• Brand Management - Building a brand through a variety of techniques
• Content Management - Managing the flow of content
• Copywriting - Writing about products, services, tutorials, or website wording
• Product Marketing - Focused on analyzing interest in a product then selling the product
• Marketing Analysis - Analyzing how to improve through meeting market demand
• Growth Marketing - Focused on increasing the market share through marketing
• PR/Communications - Communicating with external stakeholders
• Event Marketing - Marketing events like concerts or business conferences
• SEO/SEM - Improving organic search results or paid search results
• E-Commerce - Marketing products sold online

The Muse has a great article that describes what each type of marketing is like.

Socialistics focuses on social media marketing for B2B primarily. Jason told us,

Marketing is focused on helping people or companies become aware of a product or service and helping them move from unaware, to aware, to researching the offering, and finally to purchase.

Each business has a different model for accomplishing this. We'll show you some of the ways to achieve this.

Keep reading for different types of marketing agencies.

Name Your Marketing Company

I can't stress enough the importance of the name you choose when starting a marketing company. It will communicate what the company is all about. Keep reading for ideas about how to name your startup marketing agency.

Does the name explain the business?

Socialistics' name is a bit of a challenge for me to picture what it does. The name is unique, but here's how I break it down:

Social - " of or relating to human society , the interaction of the individual and the group, or the welfare of human beings as members of society" - Merriam-Webster Dictionary

-istics- "of, relating to, or characteristic of" -  Merriam-Webster Dictionary

It took me a minute to wrap my mind around the name to realize it meant relating to social media. I wonder whether Jason was going for something that made people think more about what it does.

He could be taking the exact opposite strategy of what I'd normally suggest, which could potentially offer similar results.

I tend to prefer including words like Marketing, Advertising, or something to identify what your company actually does, which can make it easier for people to think of it when they are looking for help.

Is it easy to spell?

Make sure your business name is easy to remember when using a search engine. A crazy name like Onomatopoeia Tees makes searching for your business difficult because it's hard to spell.

Because people tend to type fast, it can be helpful to register domain names for common misspellings of your business name and forward them to your website to make it easier for customers to find you.

Including your state, county, or city identifies you as a local business. For example, Sin City Modeling Agency would obviously be focused on models in Las Vegas.

I would typically discourage this for a marketing company unless you are specifically trying to narrow your business model to serve clients in the local area.

There is too much remote work available to limit yourself from the start. Later it might make sense, but in the beginning, it can be hard to get that first big client.

Does your name fit your branding? Some business owners focus on visual ideas for a logo before a name. Fortunately, Socialistics logo spells out what they do for people. Take a look:

As you can see, it has their name and "a social media agency."

The "S" in the logo also hints at one of the advantages of social media marketing: the fact that internet marketing offers a closed-loop marketing strategy, while other forms of advertising do not.

Overall, I like it. It tells what the company does, suggests differentiation to those who know about the industry, and also could have ties to their belief in community service because what we put out into the world comes back to us.

Register a .com

Find a name for which the .com domain is available. It's the most recognizable. You can conduct a search by clicking here . The longer you can purchase it for, the better. This helps communicate that you are in it for the long haul.

Some great places to buy a domain include:

• Google Domains
• Your Web Builder
• Unstoppable Domains   - only use if you are familiar with blockchain technology

Test Your Name!

See how people like it. Check Google Trends. Read articles like Five Tools for Naming a Business.

Make sure to check what happens if people shorten it. You wouldn't want to name a business Sensational Product Advertising & Marketing because people might shorten it to SPAM, and that goes right to junk mail.

Once you're satisfied with the name, register your business name with the government so you can protect someone else from getting it.

Write a Business Plan for Your Ad Agency

You need a business plan to help define the advertising agency's objectives and strategy.

A business plan for your advertising agency guides decision-making, helps financiers consider whether to provide startup costs, and gives you something to show businesses who could be potential partners or clients. 

A business plan should answer the following questions:

• What was your inspiration for starting an advertising agency?
• What problem are you solving for clients?
• What is the market opportunity? Who are your clients? What types of businesses need your services?
• What is different about your advertising agency? Why should other businesses believe you will be successful?
• What progress has your agency made so far?
• What startup costs have you already incurred by starting an agency?
• What do you need funding for? What are the costs associated with incremental sales?

A creative business plan goes a long way. It needs to be inspiring, informative, and factual. There are a ton of businesses in constantly changing environments, so you need to stand out to a potential client.

A business plan that is constantly evolving helps you keep your business plan in line with where the business is and where you want it to go. We've compiled some resources to help you build an awesome business plan.

We've gathered templates to help you develop your business plan. Here are some of the best:

• One-page business plan
• U.S. Small Business Administration (SBA) Business Guide
• State-specific templates
• Business Plan Template for a Startup Business

It gets better! Here's some free and low-cost education on business plans:

• How to Write a  Business Plan
• SCORE's free business plans and startup assistance resources
• The Complete Business Plan Course (Includes 50 Templates)

How to Start an Online Advertising Agency

Most types of businesses have similar processes that have to be performed.

Whether you want to know how to start a digital marketing agency or how to start a social media marketing agency, there are related expenses that will be incurred. Every agency will need to:

• Legally establish the advertising agency
• Obtain necessary licenses and tax requirements
• Obtain funding
• Establish a location
• Create a website
• Create social media profiles
• Have a tech stack that simplifies the operations of your small business

We'll give you tips and information on how to get the most of your digital marketing company in each of these areas.

Legally Establish the Advertisement Agency

You've developed a plan and created a name for your advertising agency. It's time to create the legal structure.

For best results, hire legal representation that has experience starting advertising agencies, like an attorney, accountant, or tax specialist.

It will simplify the process so you can get clients, build a team, and run creative campaigns.

There are five basic types of legal structures that most people will utilize: sole proprietorships, Limited Liability Corporations (LLC), Partnerships, Corporations, and Franchises.

Each has its pros and cons. You'll have to decide which is best for you, but we've gathered information on each to make it easier.

Sole Proprietorship

A sole proprietorship is the easiest way to start a digital ad company, but the structure doesn't protect the owner's personal assets from legal issues. That means if something goes wrong, you could lose both your agency and your home.

This structure is the least difficult to set up, but I'd recommend agencies getting professional liability insurance and cybersecurity insurance because you'll be a potential entry point to clients' systems.

If your website, email, or other services get hacked, it could be detrimental to more than just your agency: it could cause client lawsuits.

To start a sole proprietorship, fill out a special tax form called a  Schedule C . Sole proprietors can also join the American Independent Business Alliance .

Limited Liability Corporation (LLC)

An LLC is the most common business structure used in the United States because an LLC protects the owner's personal assets.

It's similar to partnerships and corporations, but can be a single-member LLC in most states. An LLC requires a document called an operating agreement.

Each state has different requirements. Here’s a link to find your state's requirements . Delaware and Nevada are common states to file an LLC because they are really business-friendly. Here's a blog on the top 10 states to get an LLC.

Partnerships and Corporations

Partnerships and corporations are typically for massive organizations or legal firms.

Unless there is a specific reason you need a partnership, it is better to do a multi-person LLC. Investopedia has good information about partnerships and corporations here .

There are several opportunities to purchase successful franchises. TopFranchise.com has a list of 10 advertising companies that you can start as a franchise.

This makes it where an entrepreneur can benefit from the reputation of an established clothing printer that has already worked out many of the kinks of starting from scratch.

Check out our BigFrog videos to learn more about franchise benefits. They are a t-shirt printing company, but they still have great advice on the business model.

Obtain Necessary Licenses

Each location has different licenses, permits, or tax forms required. Use the SBA License and Permits page to find requirements for your locations. Some locations have very confusing regulations.

If you don't work with a legal representative, make sure to talk to the employees who work in the licensing and tax offices. They can give you advice on which licenses you actually need.

Make it a point to follow the laws. I once met a person who failed to follow the proper regulations, and it cost her a substantial fine and nearly 100 hours of community service per month.

Obtain Funding

Ad Agency startup costs can be achieved for under $1,000. You basically need some space in your home, a website, social media, and some time.

If you are going to rent an office space or run a ton of paid ad campaigns, the cost goes dramatically up.

That's not really necessary unless you are starting a franchise or have a local team that needs a space to all work together. When it's just you, an advertising agency can be started for less than a few hundred per month.

If you do need to obtain external funding, other options include:

• Loan from family or friends
• Business partner(s)
• Government programs

The SBA offers free courses on financing options and funding programs . For info on using personal funds to start a business, check out this article from The Hartford.

Alternative sources of funding include:

• Crowdfunding  
• Credit cards
• Home equity loan
• Rollover for business startups (ROBS)

Establish a Location

For most small business owners, an advertising agency can be a home-based business until you've reached profitability. Many will meet a client at a local coffee shop.

If you feel you need a more professional location to book the job, I'd recommend looking into office-sharing services like WeWork . They let you share space with others, reducing the expenses of having an office.

Some things to consider if you go other routes are:

• How many people will be on my team?
• How many people will come to a client meeting?
• How can I display my campaigns?
• Does space encourage the exchange of ideas?
• How quickly is the company growing?
• Will we have a sales team to answer client calls?
• Are we 24/7 because we offer services across the world?

Contact a local commercial real estate agent to assist you in the search. You can search for them by your area here.

Create a Website

A website is critical to a marketing company. It's often the first thing people see, and if the job isn't done right, why should they trust you to do their advertising right?

From a marketing perspective, your website needs to show you get results. But what does that mean?

Some things I look for when I search for businesses include:

• Do they come up when I search them? With Target, Yes they do.
• Does it show Wikipedia or Google My Business information in the search? If not, make sure you fix that.
• When I click on the link, how fast does it load? I want instantaneous on desktop or less than 3 seconds if over cell phone data. Any less, and you are losing customers. Google has extensive data on what is expected to rank high in search.
• Now that I'm on the site, does it look professional? If not, I'm probably going to run unless I can tell they use it for experimentation.

Building a great website is so important. Fortunately, there's a lot of things that make it easy. Using web builders has never been easier. They have tons of plugins and drag-and-drop functionality. I'd recommend the following:

• Easiest to use: Wix
• Best features: Wordpress
• Other Options: Great List

Add the list of website builders into the article. Get affiliate links from Serge.

Alternatively, you can hire a web developer, but they'll probably charge you up to $25k to do the same setup you would anyways. They just accomplish it quicker because they know what they are doing.

Create Social Media Profiles

I'd recommend having all possible social media profiles because you never know where you'll find a client. For B2B, the best is LinkedIn , but I'd also make sure you are on:

• YouTube - Best for Video 
• Instagram - Best for products and other marketing that uses pictures
• Facebook - Best for B2C marketing
• Twitter - Financial markets, political, and crypto are big industries on Twitter
• TikTok - Short fun videos primarily targeted to ages 30 and under

You can start with one and focus on it or try them all and narrow them down based on the results. Hootsuite has some good information on best practices . You'll need to keep up to date on these if you are starting an advertising agency.

Have a tech stack that simplifies the operations of your advertising agency

Every advertising agency will need a tech stack to make running the business easier.

I'm not going to go into great detail on each of them as they all have great educational resources available that I suggest you utilize as you'll be using them a lot. Here's the list of some I love:

• HootSuite or other social media management tools that put all your social accounts in one place and let you manage it from their dashboard.
• Google Workspace for email, spreadsheets, presentations, and cloud storage.
• Integrated accounting software that connects to your bank and allows automation so you only have to set a rule once. PC Mag has a great article about various options.
• Customer Relationship Management (CRM) software to keep all your information in one place. Agencies have a ton of content they handle for a lot of clients. Being able to keep track of it in one place is crucial for the success of the business.
• Content Management Software (CMS) is used for storing, labeling, and sorting content. A CMS may be part of a CRM, or it may have to be integrated, but easy access to files is critical to assist clients.
• Analytics Software will be needed and attached to all web assets so you can track how you are performing . This will be true for both the advertising agency and your clients. You can't improve results if you aren't measuring them.

These are the bare minimum I would suggest before starting an advertising agency.

Business Expansion

Now that you have everything you need to start an advertising agency, it's time to find clients and expand the business.

Marketing and Advertising Strategy for an Advertising Agency

Finding clients can be done in a variety of ways. Agencies can use their personal network, the same ad strategies you plan to use for clients, conventions, and other techniques. The biggest thing is to be sincere.

Jason told us about how he managed to land the Air Force and Habitat for Humanity. He told us,

In other words, always be ready to listen because that might be enough to land a client.

Here's what he had to say about Habitat for Humanity:

[su_youtube url="https://www.youtube.com/watch?v=kb1czTEK8f8 "]

In that scenario, he had to do lots of follow up and be patient. When clients say "no," they mean they aren't ready yet.

Potential Partnerships and Collaborations for an Advertising Agency

Partnerships and collaboration for an advertising agency may come from selling other tech that they find useful, being listed in blogs and reviews, or through fields like photographers, graphic designers, and developers.

Another source of partnerships is non-profit institutions. As Jason pointed out:

[su_quote]Habitat for Humanity wasn't so much about the money as the message it sends about our business and our values.[/su_quote]

If you can get a client that people know and share their values, it makes expansion so much easier.

Contact List Building for an Advertising Agency

Every person you come in contact with is a referral. Anything you do you should be trying to get followers, likes, and people signing up for your email list.

This makes a huge difference. You can then share more content with them to help them get closer to becoming a client. Even if they don't own a business one day, they might soon.

Some useful tools include:

• Hubspot - Free email marketing tools, including forms, databases, analytics, and templates
• MailChimp   - Similar to Hubspot’s marketing services but started as an email marketing company.
• SendGrid   - Most of my software development clients prefer SendGrid. It’s more tech-heavy though

Advertising Agency Daily Operations

An advertising agency makes its money from retainers and is mostly a time-intensive business.

The reason digital marketers use scheduling tools for as much of their work as possible is they need someone to be available when their clients need them.

People tend to use Facebook at specific times every day. If no one is available to respond to comments because they are working on something else, that is going to harm the advertising agency's clients.

If you are unable to satisfy your clients' needs, they'll go somewhere else.

Jason focuses on "service over revenue growth" because the revenue growth will come with time.

As long as they retain the customers they have, they know they'll have around $40k/month coming in consistently while managing 15 clients.

Remote Workforce in Advertising Agencies

Jason was concerned that his team being spread across the world would hurt him.

The idea that your team couldn't be all together was something he viewed as a challenge at first, but now he views it as one of the main sales points.  He told us:

There are a ton of great resources to be able to utilize the global workforce. Companies like Upwork are a great place to start. You can find reviews of other places to find marketing freelancers in this blog .

Top Advertising/Marketing Influencers

• Neil Patel - He’s marketed everything and has over 2 million followers across all channels. His blog gets over 4 million views per month.
• Matt Bailey   - Over 20 years in Marketing and author of Internet Marketing: An Hour a Day (2011)
• Gary Vaynerchuk   - Over 30 Million followers across his platforms. 

Starting an ad agency can be a highly rewarding career. We used insights from Jason Yormark and myself to help you get an inside look at what life in the marketing business is like.

We provided you with the knowledge and resources to learn about the industry and name your company.

You have tons of resources to get the business up and running, ideas on where to find clients, and ways to operate the business.

Now it's up to you. Will you be the world's next great advertising agency?

301 Unique Cleaning Business Name Ideas (2024)

Name Ideas for Your Cleaning Service

Catchy cleaning business names, unique cleaning business names, unused cleaning business names, cute cleaning business names, funny cleaning business names, clever names for cleaning businesses.

• Carpet Cleaning Business Names

Commercial Names for Cleaning Business

House cleaning business names, eco-cleaning business names, air duct cleaning business names.

• Your New Cleaning Crew : Google “Cleaning Crew” and see what comes up. I had a result from a state halfway across the country, meaning that you can dominate this term in most locations.
• Riches Cleaning Service : Leave a pot of gold coin candy in each room when you are done.
• Dust Busters Cleaning Services : Come dressed as the Ghost Busters with a backpack vacuum on your back.

Carpet Cleaning Service Name Ideas

Cleaning Business Names Generator

What Makes Good Cleaning Company Name Ideas?

• Does your business name tell what you do and where you do it?
• Is your business name easy to remember and spell correctly?
• Does your cleaning business name have a positive connotation?
• Is the domain available?
• Is the trademark available?
• Is anyone using the name (or a similar name) in the locations where you will operate?
• Does your name translate well to other languages your customers speak?

Tip 1. Your Business Name Needs to Explain What You Do (and Where)

• Remediation
• Restoration
• Rug Cleaner : Rug Restoration Group, LLC
• Window Washing : Spotless Window Washers, Inc.
• Homes : House Stars Maid Services
• Deep Office Cleaners : Deeper Office Cleaners, LLC
• Windy City EcoMaids, LLC
• Happy House Cleaners Las Vegas, LLC
• Best Seattle Janitorial, Inc.

Tip 2. Your Cleaning Business Name Should Be Easy to Remember

• Raggedy Ann’s Maid Service
• Bippity Boppity Boo Cleaning Service (Seriously, don’t use this one. I suspect you’ll get a cease and desist letter from Disney.)
• Kompletely Klean Maid Service

Tip 3. A Cleaning Company Name Should Be Positive

• Glass House Cleaners : “Don’t throw stones in a glass house” is a common idiom that reminds us not to be hypocrites. So Glass House Cleaners could be misinterpreted.
• Washed Up Cleaning Service : Is this business past its prime or freshly showered? I’m not sure. Let’s avoid names like it.
• Discreet Maid Services
• Hands Knees Professional Cleaning

You Need Unused Cleaning Business Names

• A website domain
• A trademark
• A state business name

Tip 4. Verify the Website Domain Availability for Your Cleaning Company Name

• 2001:4860:4860::8888
• 2001:4860:4860::8844

• Protocol : Should always be https://.
• Domain Name : This is your business name. In our case UpFlip, but it’s all lowercase because domains aren’t case sensitive.
• Subdomain : The subdomain is a segment of the domain name. In this example, the subdomain is www, but it can also be a blog, info, employee, public, etc.
• Top Level Domain : .com, .edu, .gov, and .net are the most familiar ones, but country specific ones like .au, .uk, and .ru dominate the top 10 globally according to Statista.

Tip 5. Check if the Trademark is Available for Your Cleaning Company Name

Tip 6. Register the Cleaning Services with SOS

Tip 7. consider variations of the cleaning co. name, helping cleaning service businesses get ahead.

• Cleaning Business YouTube Playlist : 12 cleaning company videos 
• How to Start a Carpet Cleaning Business : Blog featuring North Seattle Carpet Cleaning
• How to Start a Cleaning Business : Blog featuring Queen Bee Cleaning

yes please i would love to learn more on this aspect

Banking business

Great article. The world of banking is an interesting one. Not just from an income standpoint, I believe the correct banking setup can help improve customers' lives as well.

I will like to join the discussion

I love the discussion and will like to continue with it because, it's very much crucial. It's lucrative for me to know more about it and thank you very much for enlighten me.

Great advice, about to start my first bank! Do you have any suggestions for the name? Thank you

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Table Content

How to start a bank in 2024: a complete step-by-step guide.

In today’s digital age, finding clear guidance on how to start a bank can be like searching for a needle in a haystack.

The available information often lacks organization and may even provide conflicting advice.

Relatable? Well then, you’ve come to the right place.

Even in the age of online banking, starting a bank remains complex and highly regulated.

That said, things get a lot easier once you know the procedure. Afterward, it’s all about defining your business and getting the right documents together.

In this article, you’ll learn the step-by-step process of how to start a bank. We’ll cover every important aspect, beginning with market research and extending to topics like mandatory permits and insurance coverage.

Without further ado, let’s get started.

Step 1: Do Some Research and Planning

Setting the groundwork should be the first step in starting any venture, and starting a bank is no exception. This will keep you from going off track as you learn how to start a bank.

Conducting thorough market research will give you insights into:

• The broader market dynamics
• Cost considerations
• Achieving profitability
• Demographics of your target market
• Your business plan

Now, let’s look at each of these factors in more detail.

Study the Market Landscape

Examining the banking landscape within your intended geographic area is a good place to start.

You can start by defining your target customer base. Then, start evaluating the demand for banking services in your target area. Oftentimes, bank startup entrepreneurs identify gaps within the market that their own bank could address.

Finally, survey existing banks and financial institutions operating in your chosen market. Check out their product portfolios, pricing strategies, customer service quality, and market positioning.

You can also use Porter’s Five Forces model to study the industry competition. It will help you understand the following market forces:

Understand the Costs Associated with Starting a Bank

Starting a bank in the United States involves a range of expenses. These costs vary based on factors like the bank’s size and location.

Here’s a list of some of the key costs you should know of before you start a bank:

• Starting capital : To start a bank, you must have an initial capital ranging from $12 million to $20 million.
• Licensing and regulatory fees : This covers costs of obtaining the necessary licenses and permits. It includes fees for federal and state banking regulators.
• Legal and compliance costs : You’ll have to shell out money for things like drafting contracts and ensuring regulatory compliance.
• Physical infrastructure costs : Cost of renting or purchasing an office space for your bank, including the cost of furnishings and equipment.
• Staff and technology costs : These are recurring expenses you’ll incur to start a bank and keep it running.
• Marketing and promotion costs : Building a customer base requires marketing, which will be an ongoing expense.
• Other costs : Additionally, there will be other costs such as insurance, accounting services, advisory fees, etc.

Make a Plan for How Your Bank Will Make Money

Banks make money by accepting deposits from individuals and businesses and then lending those funds to borrowers.

Imagine a bank that collects deposits at a 0.07% interest rate from the public. It then lends this money to borrowers at higher market rates. The profit, referred to as the “interest spread,” is the difference between both rates.

However, this is just the tip of the iceberg. Banks generate income from various other sources, some of which are listed below:

• Asset management
• Trading and brokerage
• Credit card operations
• Insurance sales
• Mortgage servicing fees

To make your bank more profitable, it’s essential to offer more than just basic services like savings accounts.

Develop a Business Plan

A comprehensive business plan is like the blueprint for your bank’s success. It spells out your bank’s vision, mission, and goals in plain language.

Additionally, it should lay down the types of financial products and services you intend to offer. Equally important is establishing effective pricing models to balance competitiveness and profitability.

Lastly, create a financial plan , and include outlines, goals, and estimates. This will not only attract investors but also provide a roadmap for financial stability and future growth.

The expert business advisors at companies like Inc Authority and ZenBusiness can help you chalk out a strong business plan, setting you up for success.

Step 2: Register Your Bank

The foundation of every startup bank begins with the establishment of a legal entity. This provides protection for personal assets and liabilities while also offering opportunities for tax advantages.

Let’s discuss the step-by-step process to start a new bank.

Choose a Legal Structure

When learning how to start a bank, one of the first crucial steps is selecting the right legal business structure. Two primary options stand out: Limited Liability Companies (LLCs) and Corporations.

Which one should you pick?

Well, the choice depends on factors like bank size, ownership structure, governance preferences, and tax considerations.

LLCs provide more flexibility with fewer regulatory demands, limited liability, and pass-through taxation. Conversely, Corporations offer a more formal structure with greater regulatory oversight but potential double taxation.

You May Also Like:

• DBA vs. LLC: What Are the Differences?
• LLC vs. Nonprofit: Everything You Need to Know

Register the Entity

Next, register the chosen legal structure with the appropriate government authorities. This involves filing articles of incorporation or organization with the state or country where your bank will be based.

Again, you use the services of business formation service providers to register your new business with the state.

Step 3: Appoint a Board of Directors

If you choose to form a Corporation, you’ll need to appoint directors.

Form a board of directors that will oversee the management of the bank. Try to aim for a diverse group with experience in business, banking, and other relevant fields.

This is something that’s taken seriously by government regulators and investors when assessing the institution.

Step 4: Get Regulatory Approvals

Send an application to the appropriate banking regulatory body to get the approval to start your banking operations.

This involves giving a detailed account of your bank’s business plan, capital setup, risk management infrastructure, management team, and how well you adhere to regulations.

Expect a rigorous regulatory process, including background checks on your team and an examination of your bank’s financial health.

For a smooth process, consider working with firms like IncFile and LegalZoom .

Step 5: Raise Capital

Once you obtain approval, you must secure initial capital to start operations. Some potential sources of capital are private investors, community investments, government grants, bank loans, and online crowdfunding.

Even after you start your bank, it’s essential to regularly assess your finances and conduct stress tests. These checks ensure you have enough capital to meet regulatory requirements and maintain financial stability.

Step 6: Register for Taxes

When you start a bank, you need to register for a range of state and federal taxes.

This will entail completing the requisite tax forms, obtaining an Employer Identification Number (EIN) from the IRS, and registering with your state’s revenue agency.

Additionally, it’s essential to stay informed about tax compliance obligations, including deadlines for filing and payment.

Companies like IncAuthority and LegalZoom provide tax planning consultations to help you maximize your tax advantages.

Step 7: Open a Bank Account

A bank requires a bank account as well.

By taking this step, you protect your personal assets, such as savings, investments, and property, from potential legal claims or lawsuits that your business might encounter.

This account will also facilitate various financial activities, including depositing customer funds, disbursing loans, processing payments, and conducting regulatory reporting.

Depending on your specific banking needs, it may also make sense to get a business credit card. Credit cards provide bank owners with a source of short-term financing, while also building their bank’s credit history.

There are several companies that simplify the process of creating a business bank account— Incfile, ZenBusiness, and LegalZoom , to name a few.

Step 8: Obtain Necessary Licenses and Permits

Without a banking license, attempting to start a bank or performing banking activities is illegal in most jurisdictions.

Furthermore, these licenses and permits often include consumer protection measures, fostering trust in the financial community.

So, which licenses do you need to start a bank?

Well, banks typically need licenses at various levels, including federal, state, and local. The specific requirements can vary significantly by location.

Here are some licenses you may need when starting a bank:

• Certificate of Occupancy (CO) : If you are setting up physical branches or offices, you may need a CO for those locations.
• Business licenses and permits : These can include local business licenses, zoning permits, and other municipal authorizations.
• Anti-Money Laundering (AML) and Know Your Customer (KYC) Compliance : You may need to obtain permits or licenses to ensure you can verify the identities of your customers and report suspicious transactions.

In the same vein, if the proposed bank wants to branch out into services like insurance, money transfers, or investments, it’ll require extra licenses.

Companies like Incfile and Inc Authority can help you quickly obtain the necessary licenses to start a bank.

Step 9: Secure Insurance Coverage

When considering how to start a bank, it’s crucial to understand the requirements for insurance. In many jurisdictions, some types of insurance like liability coverage are legally necessary.

Apart from that, here are some common types of insurance that banks may need:

• General Liability Insurance : This offers crucial protection against liabilities that can arise in day-to-day operations.
• Deposit Insurance : Mandatory for most banks, this insurance protects depositors in case of bank failure.
• Cybersecurity Insurance : This insurance helps banks recover from cyberattacks, data breaches, and other technology-related risks.
• Workers’ Compensation : It provides coverage for employees who are injured or get ill while performing their official duties.

Before you start a bank, take some time to identify potential risks and liabilities. This will help you figure out what kinds of insurance you need. You can even seek advice from experts at companies like IncAuthority and ZenBusiness to get more clarity.

Step 10: Identify Suitable Locations

Now, let’s dive deeper into how to start a bank with a focus on non-regulatory aspects.

Many Americans are shifting to online banking, leading to a decline in foot traffic at traditional brick-and-mortar banks. This isn’t to say that you should skip having a physical location, but it’s important to be mindful of this trend.

A good location for newly established banks is one that’s easy for your customers to access. Don’t forget that some states have specific rules about where banks can set up shop.

Moreover, think about the costs. Figure out if you can afford to lease or buy in a particular area.

Step 11: Invest in Technology and Staff

With the rising popularity of online banking services, it’s crucial to invest in top-notch technology.

Here are things you should invest in when you start a bank:

• Mobile app : Develop a user-friendly application to cater to customers’ mobile banking needs. Ensure it offers features like balance checking, fund transfers, and mobile check deposits.
• Cloud computing : This allows easy expansion of services and storage capabilities as your bank grows.
• AI chatbots : Use AI-powered chatbots to offer instant responses to customer inquiries and enhance customer service efficiency.
• Automated Teller Machines (ATMs) : Install ATMs at strategic locations, providing convenient access to cash for bank customers and non-customers alike.
• Cybersecurity solutions : Invest in robust cybersecurity tools to safeguard customer data and protect your bank against cyber threats. This includes firewalls, intrusion detection systems, and encryption technologies.

Simultaneously, your staff plays a pivotal role as the face of your bank. Training them for exceptional customer service and regulatory compliance is paramount.

They’re your first line of defense in keeping customer data secure, making staff cybersecurity awareness crucial.

Step 12: Market Your Business

Once you’ve settled on the ideal location, assembled your tech infrastructure, and trained your staff, it’s time to get the word out to potential customers.

First things first, develop a distinctive brand identity for your bank. This includes creating a memorable logo, crafting a unique value proposition, and defining your bank’s mission and vision.

As for marketing strategies, here are some effective ones to consider:

• Social media marketing : Small banks can share financial tips, news, and updates on social media platforms like Facebook, Twitter, and LinkedIn.
• Content marketing : Create a variety of content that solves users’ problems and covers trending topics. Start a blog, create videos, or use social media to share content that resonates with your audience.
• Email marketing : As a small bank, you should invest in email marketing as it’s a cost-effective technique. You can send emails about new services, share money-saving tips, or give updates on accounts.
• Traditional advertising : Older consumers typically prefer traditional media like newspapers and TV. Some of your options for traditional marketing are print ads, radio commercials, and billboards.

Here’s an example showing how Bank of America uses social media to share its values and company culture.

Step 13: Set up a Website and Phone System

Creating a website and setting up your phone system is like giving your bank a virtual storefront and a friendly voice.

For your website, get a domain name that matches your brand name and invest in a solid hosting service.

Design a professional website that reflects your bank’s brand identity, making sure it’s responsive for mobile users. Then, fill it with information about what you offer, where you are located, and how people can reach you.

Companies like IncFile and ZenBusiness offer more services than just business formation; they also assist with website creation. Check these out to get help with website creation and domain registration.

As such, some people still prefer traditional communication methods like phone calls. This may be because phone communication:

• Allows for a more personalized customer experience
• Makes detailed discussions and problem-solving possible
• Helps customers get immediate assistance
• Assures customers that there is a real team behind the operations

That’s why you should set up lines for all sorts of customer needs — questions, support, general information, etc. It is highly recommended for banks to use an Interactive Voice Response (IVR) system to direct calls efficiently.

Also, be clear about when you’re open for business and how to reach you in case of banking emergencies.

Q1. How much does it cost to start a bank?

A. The cost of starting a bank can vary significantly depending on various factors.

In the United States, the initial capital requirement is typically in the range of $12 million to $20 million or more. This capital is needed to meet regulatory requirements and ensure the bank’s financial stability.

Recurring costs involve technology and infrastructure expenses, leasing or purchasing physical premises, staffing, marketing, and ongoing operations.

Q2. Can anyone just start a bank?

A. No, starting a bank is not open to just anyone. It involves navigating a highly complex regulatory process.

This includes obtaining regulatory approval, meeting capital adequacy requirements, assembling a qualified team, and establishing operational infrastructure.

The process demands substantial financial resources and lending expertise.

Q3. Can an individual own a bank?

A. Yes, an individual can own a bank. However, in most countries, this is highly unlikely due to the significant regulatory and minimum capital requirements.

Banks also require the presence of experienced bankers and a robust infrastructure. As a result, ownership and governance of banks typically have to do with financial institutions or investor collectives.

Q4. How much does owning a bank make you?

A. The potential earnings from owning a bank vary depending on various factors. Most banks usually see about 10-15% in profit, with a return of 7-10% on their investments.

For online banks, the potential for substantial profits exists, especially if the bank offers a diverse range of services, a broad customer base, and effective risk management strategies.

In contrast, smaller community banks may have lower profit potential, but their owners benefit from closer ties to the local community and a more personal banking experience.

Q5. How can I start a bank without money?

A. If you’re wondering how to start a bank with no money, it’s essential to understand that this is highly improbable. The bank would not meet the regulatory requirements necessary for its operation and lack financial resources.

It’s essential to work closely with financial experts to navigate the process of starting a bank.

Final Thoughts: How to Start a Bank?

In a nutshell, figuring out how to start a bank is a huge task that needs a lot of commitment, financial planning , and following the rules.

Whether you’re considering starting a traditional bank or a modern digital one, the journey is complex. It involves gathering funds, creating a solid plan, building a top-notch team, and navigating the maze of regulations.

Yet, for those with a strong vision and determination, the banking industry can be rewarding.

Starting a bank is more than just a business; it’s a way to help communities, fuel economic growth, and be part of the ever-changing world of finance.

Brett Shapiro

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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 Bank 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 for Your Bank Business

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.  

Finish Your Business Plan Today!

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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Back to All Business Ideas

How to Start a Bank

Written by: Carolyn Young

Carolyn Young is a business writer who focuses on entrepreneurial concepts and the business formation. She has over 25 years of experience in business roles, and has authored several entrepreneurship textbooks.

Edited by: David Lepeska

David has been writing and learning about business, finance and globalization for a quarter-century, starting with a small New York consulting firm in the 1990s.

Published on June 20, 2022 Updated on May 7, 2024

Investment range

$13,385,150 - $28,710,200

Revenue potential

$7.2 million - $72 million p.a.

Time to build

12 – 18 months

Profit potential

$720,000 - $7.2 million p.a.

Industry trend

Banks provide people with a safe place to stash their money and a potential source of financing, along with a slew of other services. After expanding 37.3% since 2022, the US bank industry is now worth more than $1.4 trillion. 

Starting a bank is no easy undertaking, but it could be a very lucrative venture, and now is a great time. But you’ll need to learn the ropes of entrepreneurialism before you jump in. Lucky for you, this step-by-step guide details all the business knowledge you’ll need to launch and run a successful bank.

Looking to register your business? A limited liability company (LLC) is the best legal structure for new businesses because it is fast and simple.

Form your business immediately using ZenBusiness LLC formation service or hire one of the Best LLC Services .

Step 1: Decide if the Business Is Right for You

Pros and cons.

Starting a bank has pros and cons to consider before deciding if it’s right for you. 

• Provide value — Crucial financial services for your community
• Large market — Most people rely on banks
• Good money — Banks are big money makers
• Large investment — Millions in starting capital required
• Highly regulated — Banking is the most regulated industry in the US

Bank Industry Trends

Industry size and growth.

• Industry size and past growth — The US commercial banking industry was worth $1.4 trillion in 2023 after expanding 37.3% since 2022. On average, the industry has grown 5.6% over the last five years.(( https://www.ibisworld.com/industry-statistics/market-size/commercial-banking-united-states/ )) 
• Growth forecast — The US commercial banking industry is projected to grow more than 2% yearly by 2029.(( https://www.mordorintelligence.com/industry-reports/us-commercial-banking-market ))
• Number of businesses — In 2023, 4,867 commercial banking businesses were operating in the US.(( https://www.ibisworld.com/industry-statistics/number-of-businesses/commercial-banking-united-states/ )) 
• Number of people employed — In 2023, the US commercial banking industry employed 2,595,852 people.(( https://www.ibisworld.com/industry-statistics/employment/commercial-banking-united-states/ ))

Trends and Challenges

• Digital banking is the way of the future, with major banks competing to have the best apps, websites, and digital services, like instant payments.
• Technologies such as Robotic Process Automation and machine learning are helping banks replace manual workflows with cost-efficient, lightning-fast operations.
• For small banks, keeping up with technology to compete with major banks can be expensive. 
• Regulations on banks — already the country’s most regulated industry — are continuing to tighten, creating new expenses and operational challenges.

Demand Hotspots

• Most popular states — The most popular states for bank managers are New York, California, and Washington.
• Least popular states — The least popular states for bank managers are Nebraska, Wyoming, and North Dakota.(( https://www.zippia.com/bank-manager-jobs/best-states/ ))

What Kind of People Work in Banks?

• Gender — 51.1% of bank managers are female, while 48.9% are male.
• Average level of education — The average bank manager has a bachelor’s degree.
• Average age — The average bank manager in the US is 45.8 years old.(( https://www.zippia.com/bank-manager-jobs/demographics/ ))

How Much Does It Cost to Start a Bank Business?

Startup costs for a bank range from $13 million to $28 million, with the biggest expense being the startup capital required to meet federal regulations. If you start a digital rather than a physical bank, you could save up to $4 million. 

You will need to apply for licenses and insurance with the Federal Reserve and the Federal Deposit Insurance Corporation (FDIC) , which is often a laborious process.

You’ll need a handful of items to successfully launch your bank business, including: 

• Computer system
• Printers, money counters, other office equipment
• Security system
• Furnishings

How Much Can You Earn From a Bank Business?

Banks make money from fees and from the interest on loans that they make. The profit margin of a bank is typically about 10%. 

In your first year or two, you might get 10,000 customers and make $100,000 in fees per month and $500,000 in interest, bringing in $7,200,000 in annual revenue. This would mean $720,000 in profit, assuming that 10% margin. As you build your customer base, those numbers might increase tenfold. With annual revenue of $72,000,000, you’d make an outstanding profit of $7.2 million. 

What Barriers to Entry Are There?

There are a few barriers to entry for a bank. Your biggest challenges will be:

• A large amount of initial capital 
• Understanding the complex administrative processes 
• Navigating the regulatory environment

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Step 2: hone your idea.

Now that you know what’s involved in starting a bank, it’s a good idea to hone your concept in preparation to enter a competitive market. 

Market research will give you the upper hand, even if you’re already positive that you have a perfect product or service. Conducting market research is important, because it can help you understand your customers better, who your competitors are, and your business landscape.

Why? Identify an Opportunity

Research banks in your area to examine their products and services, price points, and customer reviews. You’re looking for a market gap to fill. For instance, maybe the local market is missing a community bank that offers free checking accounts or an online bank that offers money market accounts. 

You might consider targeting a niche market by specializing in a certain aspect of your industry, such as savings accounts and mortgage loans, or business accounts and loans.

This could jumpstart your word-of-mouth marketing and attract clients right away. 

What? Determine Your Financial Products and Services

Banks offer a variety of products and services, including:

• Checking accounts
• Savings accounts
• Money market accounts
• Mortgage loans and other loans
• Credit cards
• Wealth management services

How Much Should You Charge for Bank Services?

Account fees can range from $5 to $15 per month. Banks also charge fees for overdrafts, ATMs, and other services. Loan rates will be dictated by the current market environment. The profit margin for banks is generally about 10%. 

Once you know your costs, you can use our profit margin calculator to determine your markup and final price points. Remember, the prices you use at launch should be subject to change if warranted by the market.

Who? Identify Your Target Market

Your target market will be basically anyone. You should spread out your marketing to include TikTok, Instagram, Facebook, and LinkedIn. 

Where? Choose Your Bank Location

Selecting the right location for your bank is crucial for its success. Look for a location in a high-traffic area, preferably in a commercial district or near other financial institutions. You can find commercial space to rent in your area on sites such as Craigslist , Crexi , and Instant Offices .

Consider the accessibility and convenience for clients, with easy access to parking and public transportation. Additionally, you should analyze the demographics of the surrounding area to ensure there is a demand for banking services.

By choosing a strategic location, you can position your bank to attract a wide range of customers and establish a strong presence in the financial industry.

Step 3: Brainstorm a Bank Name

Here are some ideas for brainstorming your business name:

• Short, unique, and catchy names tend to stand out
• Names that are easy to say and spell tend to do better 
• Name should be relevant to your product or service offerings
• Ask around — family, friends, colleagues, social media — for suggestions
• Including keywords, such as “bank” or “community bank,” boosts SEO
• Name should allow for expansion, for example, “Peak Performance Bank” over “Student Loan Bank”
• A location-based name can help establish a strong connection with your local community and help with the SEO but might hinder future expansion

Discover over 290 unique bank business name ideas here . If you want your business name to include specific keywords, you can also use our bank business name generator. Just type in a few keywords, hit Generate, and you’ll have dozens of suggestions at your fingertips.

Once you’ve got a list of potential names, visit the website of the US Patent and Trademark Office to make sure they are available for registration and check the availability of related domain names using our Domain Name Search tool. Using “.com” or “.org” sharply increases credibility, so it’s best to focus on these. 

Find a Domain

Powered by GoDaddy.com

Finally, make your choice among the names that pass this screening and go ahead with domain registration and social media account creation. Your business name is one of the key differentiators that sets your business apart. However, once you start with the branding, it is hard to change the business name. Therefore, it’s important to carefully consider your choice before you start a business entity.

Step 4: Create a Bank Business Plan

Here are the key components of a business plan:

• Executive summary — A concise summary highlighting the key points of the business plan, including its mission, goals, and financial projections
• Business overview — An overview of the business, detailing its mission, vision, values, and the problem it aims to solve or the need it fulfills
• Product and services — A detailed description of the products and services offered by the business, emphasizing their unique selling points and value proposition
• Market analysis — A comprehensive analysis of the target market, including demographics, trends, and potential opportunities and challenges
• Competitive analysis — An assessment of the competitive landscape, identifying key competitors, their strengths and weaknesses, and the business’s competitive advantage
• Sales and marketing — A strategy outlining how the business plans to promote and sell its products or services, including pricing, distribution, and promotional activities
• Management team — A brief introduction to the key members of the management team, highlighting their relevant skills and experience
• Operations plan — An outline of the day-to-day operations of the business, covering processes, facilities, technology, and any other critical operational aspects
• Financial plan — A detailed financial forecast, including income statements, balance sheets, and cash flow projections, demonstrating the business’s financial viability and potential for profitability
• Appendix — Supplementary materials such as charts, graphs, and additional information that support and enhance the main components of the business plan

If you’ve never created a business plan, it can be an intimidating task. You might consider hiring a business plan specialist to create a top-notch business plan for you.

Step 5: Register Your Business

Registering your business is an absolutely crucial step — it’s the prerequisite to paying taxes, raising capital, opening a bank account, and other guideposts on the road to getting a business up and running.

Plus, registration is exciting because it makes the entire process official. Once it’s complete, you’ll have your own business! 

Choose Where to Register Your Company

Your business location is important because it can affect taxes, legal requirements, and revenue. Most people register their business in the state where they live, but if you’re planning to expand, you might consider looking elsewhere, as some states could offer real advantages when it comes to banks. 

If you’re willing to move, you could really maximize your business! Keep in mind that it’s relatively easy to transfer your business to another state. 

Choose Your Business Structure

Business entities come in several varieties, each with its pros and cons. The legal structure you choose for your bank will shape your taxes, personal liability, and business registration requirements, so choose wisely. 

Banks are typically corporations — they cannot be formed as LLCs by law.

Here are your options:

• C Corporation — Under this structure, the business is a distinct legal entity and the owner or owners are not personally liable for its debts. Owners take profits through shareholder dividends, rather than directly. The corporation pays taxes, and owners pay taxes on their dividends, which is sometimes referred to as double taxation.
• S Corporation — An S Corporation refers to the tax classification of the business but is not a business entity. It can be either a corporation or an LLC , which just needs to elect to be an S Corp for tax status. Here, income is passed through directly to shareholders, who pay taxes on their share of business income on their personal tax returns.

Step 6: Register for Taxes

The final step before you’re able to pay taxes is getting an Employer Identification Number or EIN. You can file for your EIN online, or by mail/fax. Visit the IRS website to learn more.

Once you have your EIN, you’ll need to choose your tax year. Financially speaking, your business will operate in a calendar year (January–December) or a fiscal year, a 12-month period that can start in any month. This will determine your tax cycle, while your business structure will determine which taxes you’ll pay.

The IRS website also offers a  tax-payers checklist , and taxes can be filed online.

It is important to consult an accountant or other professional to help you with your taxes to ensure you’re completing them correctly.

Step 7: Fund Your Business

Securing financing is your next step and there are plenty of ways to raise capital:

• Bank loans — This is the most common method but getting approved requires a rock-solid business plan and a strong credit history.
• SBA-guaranteed loans — The Small Business Administration can act as a guarantor, helping gain that elusive bank approval via an SBA-guaranteed loan .
• Government grants — A handful of financial assistance programs help fund entrepreneurs. Visit Grants.gov to learn which might work for you.
• Venture capital — Venture capital investors take an ownership stake in exchange for funds, so keep in mind that you’d be sacrificing some control over your business. This is generally only available for businesses with high growth potential.
• Angel investors — Reach out to your entire network in search of people interested in investing in early-stage startups in exchange for a stake. Established angel investors are always looking for good opportunities. 
• Friends and family — Reach out to friends and family to provide a business loan or investment in your concept. It’s a good idea to have legal advice when doing so because SEC regulations apply.
• Personal — Self-fund your business via your savings or the sale of property or other assets.

Your best bet to finance a bank is to seek out angel investors or venture capital. You’ll have to have an extremely detailed business plan and pitch when seeking the considerable amount of money that you need. 

Step 8: Apply for Bank Business Licenses and Permits

Starting a bank business requires obtaining a number of licenses and permits from local, state, and federal governments. You will need to apply for licenses and insurance with the Federal Reserve and the Federal Deposit Insurance Corporation (FDIC) . 

Federal regulations, licenses, and permits associated with starting your business include doing business as (DBA), health licenses and permits from the Occupational Safety and Health Administration ( OSHA ), trademarks, copyrights, patents, and other intellectual properties, as well as industry-specific licenses and permits. 

You may also need state-level and local county or city-based licenses and permits. The license requirements and how to obtain them vary, so check the websites of your state, city, and county governments or contact the appropriate person to learn more. 

You could also check this SBA guide for your state’s requirements, but we recommend using MyCorporation’s Business License Compliance Package . They will research the exact forms you need for your business and state and provide them to ensure you’re fully compliant.

This is not a step to be taken lightly, as failing to comply with legal requirements can result in hefty penalties.

If you feel overwhelmed by this step or don’t know how to begin, it might be a good idea to hire a professional to help you check all the legal boxes.

Step 9: Open a Business Bank Account

Before you start making money, you’ll need a place to keep it, and that requires opening a bank account .

Keeping your business finances separate from your personal account makes it easy to file taxes and track your company’s income. Opening a business bank account is quite simple, and similar to opening a personal one. Most major banks offer accounts tailored for businesses — just inquire at your preferred bank to learn about their rates and features.

Banks vary in terms of offerings, so it’s a good idea to examine your options and select the best plan for you. Once you choose your bank, bring in your EIN, articles of incorporation, and other legal documents and open your new account. 

Step 10: Get Business Insurance

Business insurance is an area that often gets overlooked yet it can be vital to your success as an entrepreneur. Insurance protects you from unexpected events that can have a devastating impact on your business.

Here are some types of insurance to consider:

• General liability — The most comprehensive type of insurance, acting as a catch-all for many business elements that require coverage. If you get just one kind of insurance, this is it. It even protects against bodily injury and property damage.
• Business property — Provides coverage for your equipment and supplies.
• Equipment breakdown insurance — Covers the cost of replacing or repairing equipment that has broken due to mechanical issues.
• Worker’s compensation — Provides compensation to employees injured on the job.
• Property — Covers your physical space, whether it is a cart, storefront, or office.
• Commercial auto — Protection for your company-owned vehicle.
• Professional liability — Protects against claims from clients who say they suffered a loss due to an error or omission in your work.
• Business owner’s policy (BOP) — This is an insurance plan that acts as an all-in-one insurance policy, a combination of the above insurance types.

You will also need FDIC insurance, and then you can use “member FDIC” in your marketing. 

Step 11: Prepare to Launch

As opening day nears, prepare for launch by reviewing and improving some key elements of your business. 

Essential Software and Tools

Being an entrepreneur often means wearing many hats, from marketing to sales to accounting, which can be overwhelming. Fortunately, many websites and digital tools are available to help simplify many business tasks. 

You may want to use industry-specific software, such as Salesforce , FIS , or Alogent , to manage your operations, insurance, compliance, accounts, and financial processing.

• Popular web-based accounting programs for smaller businesses include Quickbooks , FreshBooks , and Xero . 
• If you’re unfamiliar with basic accounting, you may want to hire a professional, especially as you begin. The consequences of filing incorrect tax documents can be harsh, so accuracy is crucial. 

Develop Your Website

Website development is crucial because your site is your online presence and needs to convince prospective clients of your expertise and professionalism.

You can create your own website using website builders . This route is very affordable, but figuring out how to build a website can be time-consuming. If you lack tech savvy, you can hire a web designer or developer to create a custom website for your bank.

However, people are unlikely to find your website unless you follow Search Engine Optimization ( SEO ) practices. These are steps that help pages rank higher in the results of top search engines like Google. 

Here are some powerful marketing strategies for your future bank:

• Local SEO — Regularly update your Google My Business and Yelp profiles to strengthen your local search presence.
• Social media financial education — Utilize platforms like LinkedIn to share financial insights and advice, establishing the bank as a thought leader.
• Digital advertising — Run targeted advertising campaigns for specific financial products and services to reach the right audience.
• Financial literacy campaigns — Distribute newsletters regularly with financial wellness tips and updates on banking products.
• Educational blog — Create content that provides guidance on financial trends, investment strategies, and saving tips.
• Webinars and live Q&As — Host online sessions that address customer financial concerns and recent market changes, enhancing engagement.
• Local sponsorships — Increase your community presence by sponsoring local events and sports teams.
• Financial workshops — Offer free financial planning workshops that cater to various life stages to educate and attract customers.
• Partnerships with local businesses — Collaborate with local businesses to offer banking benefits and host financial seminars.
• Personalized banking services — Provide tailored banking solutions based on customer data to enhance customer satisfaction.
• Rewards program — Develop a rewards program that incentivizes customers to use different banking services.
• Introductory offers — Launch promotions such as new account signup bonuses or reduced rates on loans for a limited time to attract new customers.

Focus on USPs

Unique selling propositions, or USPs, are the characteristics of a product or service that set it apart from the competition. Today, customers are inundated with buying options, so you’ll have a real advantage if they are able to quickly grasp how your bank meets their needs or wishes. It’s wise to do all you can to ensure your USPs stand out on your website and in your marketing and promotional materials, stimulating buyer desire. 

Global pizza chain Domino’s is renowned for its USP: “Hot pizza in 30 minutes or less, guaranteed.” Signature USPs for your bank business could be:

• A welcoming community bank for all your financial needs
• Free checking accounts and the best loan rates in town
• Digital banking made easy

You may not like to network or use personal connections for business gain but your personal and professional networks likely offer considerable untapped business potential. Maybe that Facebook friend you met in college is now running a bank, or a LinkedIn contact of yours is connected to dozens of potential clients. Maybe your cousin or neighbor has been working in banks for years and can offer invaluable insight and industry connections. 

The possibilities are endless, so it’s a good idea to review your personal and professional networks and reach out to those with possible links to or interest in banks. You’ll probably generate new customers or find companies with which you could establish a partnership. 

Step 12: Build Your Team

If you’re starting out small from a home office, you may not need any employees. But as your business grows, you will likely need workers to fill various roles. Potential positions for a bank business include:

• Bank tellers — handling bank transactions
• Personal bankers — opening accounts, taking loan applications
• Mortgage originators — taking mortgage loan applications
• Bank manager — scheduling, managing branch operations
• Operations manager — managing back-office functions
• Compliance officer — handling regulatory compliance

At some point, you may need to hire all of these positions or simply a few, depending on the size and needs of your business. You might also hire multiple workers for a single role or a single worker for multiple roles, again depending on need. 

Free-of-charge methods to recruit employees include posting ads on popular platforms such as LinkedIn, Facebook, or Jobs.com. You might also consider a premium recruitment option, such as advertising on Indeed , Glassdoor , or ZipRecruiter . Further, if you have the resources, you could consider hiring a recruitment agency to help you find talent. 

Step 13: Run a Bank — Start Making Money!

Starting a bank takes time and money, and it’s a complicated business to run, but once you get it going, you can make a lot of money and serve your community. If you’re willing to do what it takes, you could even build your community bank into a national powerhouse! 

Now that you understand what’s involved in the business, it’s time to find investors, get your bank up and running and start financing people’s dreams. 

• Bank Business FAQs

Banks are very profitable, considering that the U.S. banking industry is worth more than $860 billion. The key is to provide a variety of banking services and offer great customer service.

You’ll have to spend some time marketing to get the word out. Then, when customers come in, you’ll want them to receive personal service.

A business plan is a detailed document that requires considerable time to develop. It includes various sections such as an executive summary , company overview , descriptions of your products and services , market analysis , competitor analysis , sales and marketing plan , management summary , operations plan , and financial projections .

A risk management plan for a bank is very complex. Your best bet is to hire an experienced banking consultant to help you. It will be worth the cost.

Commercial banks generally operate nationally and are subject to federal multi-state banking regulations. Community banks only operate in one state or locality.

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• Decide if the Business Is Right for You
• Hone Your Idea
• Brainstorm a Bank Name
• Create a Bank Business Plan
• Register Your Business
• Register for Taxes
• Fund Your Business
• Apply for Bank Business Licenses and Permits
• Open a Business Bank Account
• Get Business Insurance
• Prepare to Launch
• Build Your Team
• Run a Bank — Start Making Money!

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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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How to Start a Bank

Banks take in deposits from depositors and then lend that money out to other people and businesses. Banks provide a vital function in the economy. Namely, liquidity. They allow individuals and businesses to pay for goods and services, investments, and assets that they otherwise would not be able to afford.

Learn how to start your own Bank and whether it is the right fit for you.

Ready to form your LLC? Check out the Top LLC Formation Services .

Start a bank by following these 10 steps:

• Plan your Bank
• Form your Bank into a Legal Entity
• Register your Bank for Taxes
• Open a Business Bank Account & Credit Card
• Set up Accounting for your Bank
• Get the Necessary Permits & Licenses for your Bank
• Get Bank Insurance
• Define your Bank Brand
• Create your Bank Website
• Set up your Business Phone System

We have put together this simple guide to starting your bank. These steps will ensure that your new business is well planned out, registered properly and legally compliant.

Exploring your options? Check out other small business ideas .

STEP 1: Plan your business

A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:

What will you name your business?

• What are the startup and ongoing costs?
• Who is your target market?

How much can you charge customers?

Luckily we have done a lot of this research for you.

Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Bank Name Generator

If you operate a sole proprietorship , you might want to operate under a business name other than your own name. Visit our DBA guide to learn more.

When registering a business name , we recommend researching your business name by checking:

• Your state's business records
• Federal and state trademark records
• Social media platforms
• Web domain availability .

It's very important to secure your domain name before someone else does.

Want some help naming your bank?

Business name generator, what are the costs involved in opening a bank.

The costs are significant, since the banking industry is the most regulated industry in the country. Banks generally need between $12 to $20 million in starting capital. If you start a local community bank, you might be able to raise that money locally. Otherwise, you may have to solicit investors.

Once the capital is raised, you must apply to regulatory agencies. Regulators are strict in their review of applications since the financial crisis. Once you're approved, you may open up your bank.

What are the ongoing expenses for a bank?

Ongoing expenses vary. However, in general, expenses are 15% of non-interest expenses, with a median expense across the country of about $400,000 per branch.

Who is the target market?

Preferred customers are both individuals and businesses.

How does a bank make money?

Banks make money by taking in deposits and lending them out to other people or businesses. A bank's primary cost is the infrastructure they build, including buildings and labor costs. However, the basic function of a bank is simple. The bank must invest its money in such a way that they earn more than what it costs them to keep money on deposit.

For example, a bank may accept deposits from the general public and pay them 0.05% on savings accounts. They can then lend this money out to others at market rates. The difference between the 0.05% and the market rate is the interest "spread." This is the bank's profit.

Banks also make money by charging fees and offering other banking services, like business checking accounts, bank certificates of deposit, and money market accounts. Some banks also sell insurance.

You can charge customers for opening and maintaining a checking or savings account. The type and amount of fees vary, as well as how they are charged. Some banks have minimum deposit levels, while others charge monthly service fees that range from $5 per month to $100 per year unless a minimum balance is kept in the account. Most banks charge fees for overdrafts. And then there are the service fees for printing account balances, doing wire transfers, and a performing a host of other services.

How much profit can a bank make?

Banks typically make between 10% and 15% net profit. Return on equity ranges between 7% and 10%. Some banks realize a strong return on equity in excess of 10%.

How can you make your business more profitable?

Consider setting up an expansive network of ATMs to bring in more income for the bank. Offer more services. Banks can do more than just bank, these days. Consider offering insurance and retirement accounts.

Want a more guided approach? Access TRUiC's free Small Business Startup Guide - a step-by-step course for turning your business idea into reality. Get started today!

STEP 2: Form a legal entity

The most common business structure types are the sole proprietorship , partnership , limited liability company (LLC) , and corporation .

Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your bank is sued.

Form Your LLC

Read our Guide to Form Your Own LLC

Have a Professional Service Form your LLC for You

Two such reliable services:

You can form an LLC yourself and pay only the minimal state LLC costs or hire one of the Best LLC Services for a small, additional fee.

Recommended: You will need to elect a registered agent for your LLC. LLC formation packages usually include a free year of registered agent services . You can choose to hire a registered agent or act as your own.

STEP 3: Register for taxes

You will need to register for a variety of state and federal taxes before you can open for business.

In order to register for taxes you will need to apply for an EIN. It's really easy and free!

You can acquire your EIN through the IRS website . If you would like to learn more about EINs, read our article, What is an EIN?

There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.

STEP 4: Open a business bank account & credit card

Using dedicated business banking and credit accounts is essential for personal asset protection.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil .

Open a business bank account

Besides being a requirement when applying for business loans, opening a business bank account:

• Separates your personal assets from your company's assets, which is necessary for personal asset protection.
• Makes accounting and tax filing easier.

Recommended: Read our Best Banks for Small Business review to find the best national bank or credit union.

Get a business credit card

Getting a business credit card helps you:

• Separate personal and business expenses by putting your business' expenses all in one place.
• Build your company's credit history , which can be useful to raise money later on.

Recommended: Apply for an easy approval business credit card from BILL and build your business credit quickly.

STEP 5: Set up business accounting

Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.

Make LLC accounting easy with our LLC Expenses Cheat Sheet.

STEP 6: Obtain necessary permits and licenses

Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.

Federal Business Licensing Requirements

Banks must be approved for federal deposit insurance. Information on requirements and how to get approved can be found on the Federal Deposit Insurance Corporation website . 

State & Local Business Licensing Requirements

Certain state permits and licenses may be needed to operate a bank. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits .

Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses .

Certificate of Occupancy

A bank is generally run out of a building or storefront. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO).  A CO confirms that all building codes, zoning laws and government regulations have been met.

• If you plan to lease a location :
• It is generally the landlord’s responsibility to obtain a CO.
• Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a bank.
• After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
• If you plan to purchase or build a location :
• You will be responsible for obtaining a valid CO from a local government authority.
• Review all building codes and zoning requirements for your business’ location to ensure your bank will be in compliance and able to obtain a CO.

STEP 7: Get business insurance

Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.

There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance . This is the most common coverage that small businesses need, so it’s a great place to start for your business.

Another notable insurance policy that many businesses need is Workers’ Compensation Insurance . If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.

FInd out what types of insurance your Bank needs and how much it will cost you by reading our guide Business Insurance for Bank.

STEP 8: Define your brand

Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.

If you aren't feeling confident about designing your small business logo, then check out our Design Guides for Beginners , we'll give you helpful tips and advice for creating the best unique logo for your business.

Recommended : Get a logo using Truic's free logo Generator no email or sign up required, or use a Premium Logo Maker .

If you already have a logo, you can also add it to a QR code with our Free QR Code Generator . Choose from 13 QR code types to create a code for your business cards and publications, or to help spread awareness for your new website.

How to promote & market a bank

Marketing your bank is difficult. Regulation controls most aspects of what you're allowed to say and do. You could start by advertising in local newspapers and on local T.V. networks. Tell others in the community about your plans to start a bank. Send out direct mail pieces and fliers to invite people to your grand opening.

How to keep customers coming back

Offer competitive banking products and services. The banking industry is filled with uncompetitive or mediocre banks. Consumers demand lower fees and better customer service and aren't getting it from many of conventional, established, banks.

Find ways to innovate, lower fees and other costs, and make your banking services simple to understand and use.

STEP 9: Create your business website

After defining your brand and creating your logo the next step is to create a website for your business .

While creating a website is an essential step, some may fear that it’s out of their reach because they don’t have any website-building experience. While this may have been a reasonable fear back in 2015, web technology has seen huge advancements in the past few years that makes the lives of small business owners much simpler.

Here are the main reasons why you shouldn’t delay building your website:

• All legitimate businesses have websites - full stop. The size or industry of your business does not matter when it comes to getting your business online.
• Social media accounts like Facebook pages or LinkedIn business profiles are not a replacement for a business website that you own.
• Website builder tools like the GoDaddy Website Builder have made creating a basic website extremely simple. You don’t need to hire a web developer or designer to create a website that you can be proud of.

Recommended : Get started today using our recommended website builder or check out our review of the Best Website Builders .

Other popular website builders are: WordPress , WIX , Weebly , Squarespace , and Shopify .

STEP 10: Set up your business phone system

Getting a phone set up for your business is one of the best ways to help keep your personal life and business life separate and private. That’s not the only benefit; it also helps you make your business more automated, gives your business legitimacy, and makes it easier for potential customers to find and contact you.

There are many services available to entrepreneurs who want to set up a business phone system. We’ve reviewed the top companies and rated them based on price, features, and ease of use. Check out our review of the Best Business Phone Systems 2023 to find the best phone service for your small business.

Recommended Business Phone Service: Phone.com

Phone.com is our top choice for small business phone numbers because of all the features it offers for small businesses and it's fair pricing.

Is this Business Right For You?

Owning a bank is a demanding endeavor. It requires intimate knowledge of the banking industry and regulatory structure of the financial services industry. A banker needs to be good under stress, love working with numbers, and also working odd hours. While employees clock out at the end of the day, a bank owner may need to take his or her work home with them.

Want to know if you are cut out to be an entrepreneur?

Take our Entrepreneurship Quiz to find out!

Entrepreneurship Quiz

What happens during a typical day at a bank?

Day to day activities of a banker include making loans, taking in deposits, and servicing bank customers. As an owner, you are also responsible for making sure the bank complies with all regulatory requirements. Banks are under immense pressure to turn a profit, so this means spending a lot of time underwriting good credit risks and figuring out where to put the bank's money so it will make a stable and reliable return.

What are some skills and experiences that will help you build a successful bank?

Bankers need to have good business sense and must be good with numbers. They are responsible for overseeing the profitability of the bank so having a degree in finance, business administration, accounting, or related field is helpful.

What is the growth potential for a bank?

Growth potential for a bank is huge. Banks can stay small or can operate as large commercial and investment banks. Some banks offer franchise opportunities, but you don't have to buy into a franchise to grow into a large national or international bank.

TRUiC's YouTube Channel

For fun informative videos about starting a business visit the TRUiC YouTube Channel or subscribe to view later.

Take the Next Step

Find a business mentor.

One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.

Having a support network in place to turn to during tough times is a major factor of success for new business owners.

Learn from other business owners

Want to learn more about starting a business from entrepreneurs themselves? Visit Startup Savant’s startup founder series to gain entrepreneurial insights, lessons, and advice from founders themselves.

Resources to Help Women in Business

There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:

If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.

What are some insider tips for jump starting a bank?

Hire someone with familiarity in starting a bank. This is a complex process which is controlled almost entirely by state and federal regulation. You must navigate a complex maze of regulatory rules and paperwork. And, the risks are high as regulators may deny your application to become a bank.

One idea for raising the capital (and support) you need is to start a small community bank first. Gain local support and funds from your community. This will show regulators you're a valuable member of the community you intend to serve.

How and when to build a team

Starting a bank usually requires a large staff. Plan on at least 10 employees for a small bank. Most banks have more than 20 employees working for them.

Useful Links

Industry opportunities.

• Franchise opportunity with RBC Royal Bank
• American Bankers Association

Real World Examples

• Bank of Ann Arbor
• Flushing Bank
• Private Bank of Buckhead

Further Reading

• Find more Business Ideas perfect for Small Towns!
• Tips for starting a bank
• More tips for starting a bank

Have a Question? Leave a Comment!

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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. 

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

Creating a business plan is essential for any business, but it can be especially helpful for commercial 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 commercial bank business owner should include in their business plan.

Download the Ultimate Business Plan Template

What is a Commercial Bank Business Plan?

A commercial 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 Commercial Bank Business Plan?

A commercial bank business plan is required for banks and investors. The document is a clear and concise guide to 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 Commercial Bank Business Plan

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

Executive Summary

The executive summary of a commercial 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 commercial bank company
• Provide a 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 commercial 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 or been involved in an entrepreneurial venture before starting your commercial bank firm, mention this.

You will also include information about your chosen commercial 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 crucial component of a commercial 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 commercial 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, commercial bank customers may include small businesses, startups, and entrepreneurs.

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 commercial 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 commercial bank business may have:

• Proven industry experience
• Extensive knowledge of the market
• Robust and innovative products and services
• Strong financial position
• Excellent customer service

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 commercial bank business via PR, by being quoted in the media, or by writing articles for industry publications.

Operations Plan

This part of your commercial 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?

The operations plan is where you also need to include your company’s business policies. 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 then each year for the following four years. Examples of milestones for a commercial bank business include reaching $X in sales. Other examples include adding new products, entering new markets, or expanding your distribution channels.

Management Team

List your team members here, including their names and titles, as well as their expertise and experience relevant to your specific commercial 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 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 Commercial Bank Firm

Balance sheet.

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

• Assets : Everything 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 Commercial Bank Firm

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 commercial bank business.

Sample Cash Flow Statement for a Startup Commercial Bank Firm

Finally, you will also want to include an appendix section including:

• 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.

Writing a good business plan gives you the advantage of being fully prepared to launch and grow your commercial 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 commercial bank, you can get started on putting together your own.  

Finish Your Business Plan in 1 Day!

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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 Write a Business Plan Banks Can't Resist Here's what your business plan needs if you want startup capital from a bank.

By The Staff of Entrepreneur Media, Inc. • Nov 13, 2014

In the book, Write Your Business Plan , the staff of Entrepreneur Media offer an in-depth understanding of what's essential to any business plan, what's appropriate for your venture and what it takes to ensure success. In this edited excerpt, the authors discuss the ABCs of getting a bank loan for your business.

Many of the most successful businesses are financed by banks, which can provide small to moderate amounts of capital at market costs. They don't want control—at least beyond the control exerted in the covenants of a loan document. And they don't want ownership. Bankers make loans, not investments, and as a general rule, they don't want to wind up owning your company.

Bankers primarily provide debt financing. You take out a loan and pay it back, perhaps in installments consisting of principal and interest, perhaps in payments of interest only, followed by a balloon payment of the principal. One of the nice things about debt financing is that the entrepreneur doesn't have to give up ownership of his company to get it.

Bankers can usually be counted on to want minimal, if any, input into how the business is run. Get behind on the payment schedule, however, and you're likely to find a host of covenants buried in your loan documentation. Loan covenants may require you to do all sorts of things, from setting a minimum amount of working capital you must maintain to prohibiting you from making certain purchases or signing leases without bank approval. Be sure to have your accountant, financial advisor or attorney review your loan documents and spell out everything for you very carefully before you sign.

A banker's first concern is getting the bank's money back plus a reasonable return. To increase their odds, bankers look for certain things, including everything from a solid explanation of why you need the money and what you're going to use it for to details about other borrowing or leasing deals you've entered into.

Bank loan applications can be almost as long and complete as a full-fledged business plan. Plans and loan applications aren't interchangeable, however. A banker may not be interested in your rosy projections of future growth. In fact, when confronted with the kind of growth projection required to interest a venture capitalist, a banker may be turned off. On the other hand, a banker is likely to be quite interested in seeing a contingency plan that will let you pay back the loan, even in the event of a worst-case scenario.

The five things a banker will look for you to address are:

1. Cash flow. One of the most convincing things you can show a banker is the existence of a strong, well-documented flow of cash that will be more than adequate to repay a loan's scheduled principal and interest. You'll need more than a projection of future cash flow, by the way. Most bankers will want to see cash flow statements as well as balance sheets and income statements for the past three or so years. And don't forget your tax returns for the same period.

2. Collateral. If you're just starting out in business or dealing with a banker you don't know well, you're unlikely to be able to borrow from a bank without collateral. Collateral is just something the bank can seize and sell to get back some or all of the money you've borrowed in the event that everything goes wrong and you can't pay it back with profits from operations. It may consist of machinery, equipment, inventory or, all too often, the equity you own in your home.

Why do bankers seek collateral? They have no desire to own second-hand equipment or your house. Experience has taught them that entrepreneurs who have their own assets at risk are more likely to stick to a business than those who have none of their own assets at risk.

3. Co-signers. They provide an added layer of protection for lenders. If your own capacity for taking on additional debt is shaky, a co-signer (who's essentially lending you their creditworthiness) may make the difference.

4. Marketing plans. More than ever before, bankers are taking a closer look at the marketing plans embedded in business plans. Strong competitors, price wars, me-too products, the fickle habits of the buying public and other market-related risks must be addressed. Your banker (and most other investors) have to know that you recognize these risks and have well-thought-out ways to deal with them. Besides, it's the cash flow from operations that pays off bank loans.

5. Management. Bankers like to stress the personal aspect of their services. Many state that they're interested in making loans based on a borrower's character as well as their financial strength. In fact, the borrower's track record and management ability are concerns for bankers evaluating a loan application. If you can show you've run one or more other companies successfully, it will increase your chances of landing a loan to get a startup going.

Bank financing is most appropriate for up-and-running enterprises that can show adequate cash flow and collateral to service and secure the loan. Bankers are less likely to provide startup money to turn a concept into a business, and they're even less likely to put up seed money to prove a concept unless you have a track record of launching previous businesses with successful results.

The old saying about bankers lending only to people who don't need to borrow is almost true. Bankers prefer to lend to companies that are almost, but not quite, financially robust enough to pursue their objective without the loan. Their natural tendency is to be conservative.

This is important to understand because it affects how and when you will borrow. You should try to foresee times you'll need to borrow money and arrange a line of credit or other loan before you need it. That will make it easier and, in many cases, cheaper in terms of interest rates than if you wait until you're a needier and, in bankers' eyes, less-attractive borrower.

Entrepreneur Staff

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How to Write a Business Plan, Step by Step

Many or all of the products featured here are from our partners who compensate us. This influences which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money .

What is a business plan?

1. write an executive summary, 2. describe your company, 3. state your business goals, 4. describe your products and services, 5. do your market research, 6. outline your marketing and sales plan, 7. perform a business financial analysis, 8. make financial projections, 9. summarize how your company operates, 10. add any additional information to an appendix, business plan tips and resources.

A business plan outlines your business’s financial goals and explains how you’ll achieve them over the next three to five years. Here’s a step-by-step guide to writing a business plan that will offer a strong, detailed road map for your business.

ZenBusiness

A business plan is a document that explains what your business does, how it makes money and who its customers are. Internally, writing a business plan should help you clarify your vision and organize your operations. Externally, you can share it with potential lenders and investors to show them you’re on the right track.

Business plans are living documents; it’s OK for them to change over time. Startups may update their business plans often as they figure out who their customers are and what products and services fit them best. Mature companies might only revisit their business plan every few years. Regardless of your business’s age, brush up this document before you apply for a business loan .

» Need help writing? Learn about the best business plan software .

This is your elevator pitch. It should include a mission statement, a brief description of the products or services your business offers and a broad summary of your financial growth plans.

Though the executive summary is the first thing your investors will read, it can be easier to write it last. That way, you can highlight information you’ve identified while writing other sections that go into more detail.

» MORE: How to write an executive summary in 6 steps

Next up is your company description. This should contain basic information like:

Your business’s registered name.

Address of your business location .

Names of key people in the business. Make sure to highlight unique skills or technical expertise among members of your team.

Your company description should also define your business structure — such as a sole proprietorship, partnership or corporation — and include the percent ownership that each owner has and the extent of each owner’s involvement in the company.

Lastly, write a little about the history of your company and the nature of your business now. This prepares the reader to learn about your goals in the next section.

» MORE: How to write a company overview for a business plan

The third part of a business plan is an objective statement. This section spells out what you’d like to accomplish, both in the near term and over the coming years.

If you’re looking for a business loan or outside investment, you can use this section to explain how the financing will help your business grow and how you plan to achieve those growth targets. The key is to provide a clear explanation of the opportunity your business presents to the lender.

For example, if your business is launching a second product line, you might explain how the loan will help your company launch that new product and how much you think sales will increase over the next three years as a result.

» MORE: How to write a successful business plan for a loan

In this section, go into detail about the products or services you offer or plan to offer.

You should include the following:

An explanation of how your product or service works.

The pricing model for your product or service.

The typical customers you serve.

Your supply chain and order fulfillment strategy.

You can also discuss current or pending trademarks and patents associated with your product or service.

Lenders and investors will want to know what sets your product apart from your competition. In your market analysis section , explain who your competitors are. Discuss what they do well, and point out what you can do better. If you’re serving a different or underserved market, explain that.

Here, you can address how you plan to persuade customers to buy your products or services, or how you will develop customer loyalty that will lead to repeat business.

Include details about your sales and distribution strategies, including the costs involved in selling each product .

» MORE: R e a d our complete guide to small business marketing

If you’re a startup, you may not have much information on your business financials yet. However, if you’re an existing business, you’ll want to include income or profit-and-loss statements, a balance sheet that lists your assets and debts, and a cash flow statement that shows how cash comes into and goes out of the company.

Accounting software may be able to generate these reports for you. It may also help you calculate metrics such as:

Net profit margin: the percentage of revenue you keep as net income.

Current ratio: the measurement of your liquidity and ability to repay debts.

Accounts receivable turnover ratio: a measurement of how frequently you collect on receivables per year.

This is a great place to include charts and graphs that make it easy for those reading your plan to understand the financial health of your business.

This is a critical part of your business plan if you’re seeking financing or investors. It outlines how your business will generate enough profit to repay the loan or how you will earn a decent return for investors.

Here, you’ll provide your business’s monthly or quarterly sales, expenses and profit estimates over at least a three-year period — with the future numbers assuming you’ve obtained a new loan.

Accuracy is key, so carefully analyze your past financial statements before giving projections. Your goals may be aggressive, but they should also be realistic.

NerdWallet’s picks for setting up your business finances:

The best business checking accounts .

The best business credit cards .

The best accounting software .

Before the end of your business plan, summarize how your business is structured and outline each team’s responsibilities. This will help your readers understand who performs each of the functions you’ve described above — making and selling your products or services — and how much each of those functions cost.

If any of your employees have exceptional skills, you may want to include their resumes to help explain the competitive advantage they give you.

Finally, attach any supporting information or additional materials that you couldn’t fit in elsewhere. That might include:

Licenses and permits.

Equipment leases.

Bank statements.

Details of your personal and business credit history, if you’re seeking financing.

If the appendix is long, you may want to consider adding a table of contents at the beginning of this section.

How much do you need?

with Fundera by NerdWallet

We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

Here are some tips to write a detailed, convincing business plan:

Avoid over-optimism: If you’re applying for a business bank loan or professional investment, someone will be reading your business plan closely. Providing unreasonable sales estimates can hurt your chances of approval.

Proofread: Spelling, punctuation and grammatical errors can jump off the page and turn off lenders and prospective investors. If writing and editing aren't your strong suit, you may want to hire a professional business plan writer, copy editor or proofreader.

Use free resources: SCORE is a nonprofit association that offers a large network of volunteer business mentors and experts who can help you write or edit your business plan. The U.S. Small Business Administration’s Small Business Development Centers , which provide free business consulting and help with business plan development, can also be a resource.

On a similar note...

Find small-business financing

Compare multiple lenders that fit your business

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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Average cost of starting a small business

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Launching a small business almost always involves an initial investment. How much startup funding you need depends on many factors, such as your industry, the products or services or the store location. The cheapest businesses to start may cost as little as $12,000 initially, but other businesses like restaurants can run from $400,000 or more.

The best way to determine your startup costs is to list all expected expenses and the dollar amount for each item. Let’s drill down into the exact dollar amounts to start your business and the types of costs you may encounter.

Key small business cost statistics

• On average, small business owners spend $40,000 in their first full year. ( Shopify )
• The least expensive cost is the incorporation fee, which is around $145, while the most expensive can be equipment, typically $11,000 to $125,000. ( Forbes Advisor )
• 76% of startups without employees used personal funds to finance their business ( Fed Small Business )
• The top financial challenges for nonemployer startups are inflation as well as meeting operating expenses. ( Fed Small Business )
• Average hourly pay for an administrative assistant is $22. ( Salary )
• Average cost to build a website is $200 and costs $50 monthly for maintenance. ( WebsiteBuilderExpert )
• Average cost of adding a new employee to your payroll usually ranges from $4,000 to $20,000. These costs don’t factor in the employee’s salary and benefits. ( Indeed )

How much does it cost to start a small business?

Industry averages can help give you a general idea of how much you can expect to spend when starting a small business. As your business grows, you’ll need to be strategic about keeping costs low and opting for the most affordable materials.

By keeping costs low, you’ll see the biggest returns on your investment from business products and services. Your actual costs will vary depending on:

• Size of your business
• Physical or online location
• Number of employees
• Cost of inventory needed
• Cost to produce goods, such a labor and raw materials

Online business vs. brick-and-mortar stores

Whether you have a physical location or an online-only presence will play a significant role in your business overhead costs. For example, an online store could cost you around $2,000 to $20,000 to build, based on Shopify data . That range estimates the cost of hosting and designing a custom e-commerce site. The exact cost may be different if you have a leaner or more robust business model.

Your location can also influence small business costs. The 2021 Business Cost Index by Approve found Texas, Oklahoma, and Kentucky are the three cheapest states to run a business. California, New Jersey, and Vermont are the most expensive.

Employee payroll or contractor services

Employees are another big expenditure. According to the Bureau of Labor Statistics , the average non-government employee costs your business $41.03 to $43.26 per hour.

Given that there are 2,080 working hours in a year, the average employee may cost you roughly $85,000 to $90,000 per year, based on the Bureau of Labor Statistics wage. So if you have five employees, you’ll have to project for $425,000 to $450,000 in costs.

Another way to calculate total employee costs is to budget for their salary, employee benefits and taxes. The Small Business Administration suggests estimating employee costs to be 1.25 to 1.4 times their salary. Using that information, an employee with a $50,000 annual salary would cost you between $62,500 and $70,000.

Average cost by industry

Your average startup costs will vary greatly depending on the field or industry you’re hoping to tap into. Your industry will determine your entire business model, your inventory needs, your marketing strategy and your costs to produce your goods or services. Here’s a closer look at a few industry averages:

Types of costs for your small business

While it’s possible to fund your business with little-to-no upfront costs , you will likely encounter many expenses along the way. You’ll want to gauge whether your costs are essential to running your business or an expense that you can hold off until the business is established.

Essential costs vs. optional costs

Although there are some expenses you can do without or delay, others are unavoidable right from the start. In general, they include expenses such as:

Common essential costs

Common optional costs.

• New, rather than used or leased, equipment
• Extra office space
• Luxurious business trips and entertaining
• Social media influencers
• A CPA when you can use accounting software instead
• Excess inventory

Fixed costs vs. variable costs

You will find that some of your expenses won’t change from month to month. Others will vary, coming up once or occasionally throughout the year. To ensure that you have enough funds to cover all of your necessary fixed and variable costs, plan ahead.

Common fixed costs

• Insurance premiums
• Property tax
• Essential workers salaries
• Internet and cell phone bills
• Loan payments

Common variable costs

• Packaging and shipping
• Raw materials
• Commissions
• Credit card payments and interest
• Consultants

Average small business costs

Whether you’re starting from scratch or expanding your business, you want to get detailed about the business costs and amount you expect to spend. Having an organized business budget can help you plan for these costs and account for any revenue changes that come your way. Here’s a look at how much you can expect to spend on your fixed and variable costs.

Average fixed costs

When adding up business costs, don’t forget depreciation, which is the value that your physical business assets lose over time due to age or use. You want to include this cost because it affects your business’s overall net worth when comparing its assets versus liabilities .

Average variable costs

How to save on costs and fund your startup.

Businesses can save on startup costs by paring back business expenses to free up extra revenue, or they may opt for a business loan .

Consider trimming your overhead to make your start-up costs manageable. Starting an online business is one way to reduce or eliminate office space and insurance costs and save a little extra while you’re getting your business off the ground. Yet any business can take a hard look at business expenses and cut costs that aren’t necessary to the business’s immediate success.

Business owners can also apply for a startup loan that provides the on-hand cash needed to make products or expand operations. Many business owners take advantage of low-interest Small Business Administration (SBA) loan s or business loans that come from a traditional bank or online lender.

Finally, consider applying for a business credit card to help you cover your costs. Business credit cards typically have fewer eligibility requirements, focusing on your personal credit score when you apply. A business credit card also gives you the benefit of no interest charges if you pay in full regularly. You will get charged interest if you make the minimum payment or go past the payment due date.

Frequently asked questions

How do you calculate start-up costs, what do i need before starting to spend money on a start-up business, what are additional considerations, how do i start a small business.

Article sources

We use primary sources to support our work. Bankrate’s authors, reporters and editors are subject-matter experts who thoroughly fact-check editorial content to ensure the information you’re reading is accurate, timely and relevant.

“ How Much Does It Cost To Start a Business? (Research). ” Shopify. Accessed on October 20, 2023.

“ Business Startup Costs: How To Calculate And Budget. ” Forbes Advisor. Accessed on October 20, 2023.

“ 2023 Report on Nonemployer Firms: Finding from the 2022 Small Business Credit Survey. ” Fed Small Business. Accessed on October 20, 2023.

“ Administrative Assistant II Salary in the United States. ” Salary.com. Accessed on October 20, 2023.

“ How Much Does a Website Cost in 2023? ” WebsiteBuilderExpert. Accessed on October 20, 2023.

“ What Is the Cost of Hiring New Employees? ” Indeed. Accessed on October 20, 2023.

“ The Cost of Building an Ecommerce Website: 2023 Guide. ” Shopify. Accessed on October 20, 2023.

“ The 2021 Business Cost Index. ” Tipalti Approve. Accessed on October 20, 2023.

“ Employer Costs For Employee Compensation—June 2023. ” Bureau of Labor Statistics. Accessed on October 20, 2023.

“ How Much Does an Employee Cost You? ” U.S. Small Business Administration. Accessed on October 20, 2023.

“ How Much Does it Cost to Open a Restaurant? ” Restaurant Owner.com. Accessed on October 20, 2023.

“ How Much Does It Cost To Start A Construction Company? (In 2023). ” Starter Story. Accessed on October 20, 2023.

“ How Much Does It Cost To Open a Retail Store? ” Korona POS. Accessed on October 20, 2023.

“ How Much Does It Cost To Start An Art Business? (In 2023). ” Starter Story. Accessed on October 20, 2023.

“ How Much Does It Cost To Start An Entertainment Information Business? (In 2023). ” Starter Story. Accessed on October 20, 2023.

“ How much do small businesses pay in taxes? ” Nationwide. Accessed on October 20, 2023.

“ How much does small business insurance cost? ” Insureon. Accessed on October 20, 2023.

“ How to Create a Marketing Budget for a Small Business. ” Salesforce. Accessed on October 20, 2023.

“ What are the general costs of incorporating? ” Legal Zoom. Accessed on October 20, 2023.

“ How Much Do Y’all Spend on Packaging Materials Per Order? ” Esty Community. Accessed on October 20, 2023.

“ Average Electric Bill For Businesses In the US. ” Integrity Energy. Accessed on October 20, 2023.

“ Flat Rate Shipping — UPS Simple Rate. ” UPS. Accessed on October 20, 2023.

“ 9 Sales Commissions Structures (With Formulas and Examples). ” Indeed. Accessed on October 20, 2023.

“ The Average Cost Per Month for Office Supplies. ” Hearst Newspapers. Accessed on October 20, 2023.

“ Daily business tourism expenses in the United States 2018–2021. ” Lopez, Ana M. Accessed on October 20, 2023.

“ Small Business Development Centers. ” U.S. Small Business Administration. Accessed on October 20, 2023.

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Starting a business is a fairly common venture in the U.S. There are more than 31 million entrepreneurs in the nation, or almost 19% of the adult workforce, according to Search Logistics. Alas, far from all entrepreneurs succeed. Data from the BLS shows that approximately 20% of new businesses fail during the first two years of being open, 45% fail during the first five years and 65% collapse within the first 10 years. Just 25% of new businesses make it to 15 years and beyond.

Don’t let these statistics take the wind out of your sail if you’re thinking about starting a business. Instead, think about how you can start a business that will succeed and understand what that entails. Here are the steps to take to get going.

Make a List of Stuff You’re Good At — So Good, You’d Do It for Free

First, you should write a list of 20 to 50 things you are good at and enjoy doing. Yes, that’s a long list — but you can do it! 

“Too many people start thinking about what will make the most money rather than what makes the most sense for them,” said Brenda Gabriel , PR agency founder and consultant. “Narrow the list down to the things you are better than the average person at because of your experience and knowledge. Then knock the list down to the work you would be willing to do for free, even if you got no clients and nobody paid you.”

“The truth is that starting a business is no guarantee of making sales. At the beginning, you need to be prepared not to generate enough sales to pay yourself a proper salary. Doing something you love is one of the best insurance policies to keep going even when things get tough,” Gabriel said.

Ask ChatGPT for Help 

Once you have about three potential business ideas, Gabriel recommended logging into ChatGPT to ask for the best ways to make money from those ideas and the initial steps you need to take to make your first sales.

“Use what ChatGPT gives you to draw up a one-page business plan for how you will achieve your first $5k in sales,” Gabriel said. “It’s a big enough goal to stretch you, but small enough to feel doable.”

Think of Businesses That AI Won’t (Likely) Replace 

Mollie Plotkin of Mollie Plotkin Group suggested looking at “contra-ideas.”

Here’s an example: “If everyone is focused on AI taking away entire industries, put your focus on things that AI can’t replace: service industries and community building programs and businesses,” Plotkin said. “These are not going to go away and will be in more demand than ever.” 

Get Inspired by Your Worst Customer Service Moment 

We’ve all had pretty terrible customer service experiences. What is one that stood out to you? It could just be the seed of your business venture. 

“Consider turning a bad customer experience into your own business,” said Joy Gendusa, founder and CEO at PostcardMania . “If you have the right experience and know the industry, you could be filling a need in the market that isn’t currently being met. My business, PostcardMania, was born out of a bad customer service experience. Twenty-five years and nearly $100 million in annual revenue later, it turned out to be a pretty good idea.” 

Explore Business Chat on Reddit

Reddit is a platform to chat about everything from “Buffy the Vampire Slayer” to bad bosses, but it’s also a place where you can learn from and engage with others who have started businesses on their own. 

“Browse some related subreddits to understand what people are talking about within the category,” said Jake Luerkens, co-founder of Auxo Partners . “Do they mention any pain points they’d love to have solved?” 

Talk To People You Trust  

You can do this on Reddit and other social media platforms, but you should also do it everywhere else in your life (when appropriate): Talk to people about your business ideas. 

“Think of a few people in your life that might be interested in the product or service you want to offer, and talk to them about it,” Luerkens said. “Listen to their advice and feedback about the idea or concept. Better yet, see if you can pre-sell the product or service to them (getting your first revenue in the door is huge for momentum).”

Use Google Ads Keyword Tool   

If you have a Google Ads account setup, you can use its Google Ads Keyword tool to learn about search traffic for different keywords. 

“How many people each month are searching for the product or service you want to offer? Make sure it’s a big enough group of people to allow you to build a viable business,” Luerkens said. 

Dive Into Market Research 

Market research may seem boring, but thoroughly understanding it is crucial to success. 

“Market research becomes your best friend on this journey,” said Dominik Maka, head of SEO at LVBET . “Dive deep into your potential customers’ world. Conduct surveys, interviews and focus groups to gain valuable insights. What are their desires, needs and challenges? What existing products or services are falling short? This intel will be the foundation for your entrepreneurial adventure.”

Adopt a Green Approach 

With climate change heating up the globe, there’s increasing awareness of environmental issues. Think about how you can develop a business that is green or has a strong green angle you can promote. 

“Businesses with a focus on sustainability can find a unique place in the market,” said Amber Dixon, CEO of Elderly Guides .

Subscribe to Business Publications  

If you’re thinking of rolling up your sleeves and diving into launching a small business, get high-level intel from experts by subscribing to premier business pubs. 

“Consider subscribing to reputable business publications, both in print and online,” said Matt Diggity, founder and CEO of Diggity Marketing . “Explore different topics, from finance and technology to marketing and entrepreneurship. Engage with the content, take notes and reflect on the strategies employed by successful businesses.”

Consider Franchising

If starting a new business from scratch feels overwhelming or impossible, Dixon recommended considering buying into a franchise.

“It provides a proven business model and support,” Dixon said.  

Get Support 

Yes, you may be starting the business on your own terms, but you still will need people who support you all along the way. 

“You need a support system before, during and after launching a business,” said Emre Güzeldal, co-founder and CEO at Roketfy . “It is extremely helpful to have a family member or friend you can bounce ideas off of and who will be empathetic when you are going through the current company start-up crisis. Find a mentor or, if you’re eligible, apply for a program to help new businesses get off the ground.”

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Small Business Resources is now the Center for Business Empowerment.

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How do I open a business bank account?

January 29, 2024 | 4 minute read

Answered by Christian Bohmfalk Small Business Deposits Executive Bank of America

If you’ve started a new business, one of the most important steps you can take to keep your personal and business finances separate is to open a business bank account.

As a new business owner, you may not know what to expect when you open a business bank account. You can usually apply for a business bank account fairly quickly by filling out the required forms and providing the documentation the bank requires. Knowing the information and documents required in advance can streamline the process of getting it set up.

To learn more about the steps to launch a new business, including how to form your business with an exclusive offer from Incfile, visit The Bank of America Start a Business Center .

What do I need to open a business bank account?

Business bank accounts can generally be opened fully digitally online or through a mobile device. Alternatively, business owners can visit a branch or call to start an account.

You may need some or all of the following, depending on how you have formed your business’s legal structure:

• The address and phone number of your company
• The name(s) of the people who will be listed as account owners
• Personal identification such as your driver’s license
• A federal tax ID number for the business, also known as an employer identification number
• Your Social Security number if you are a sole proprietor
• State or local authority documents that show you’ve formed a legal entity, such as a limited liability company (LLC)
• The bank’s minimum deposit amount. Unfunded accounts may be forced to close.

To address other questions you may have about opening a business bank account, see our Frequently Asked Questions .

Why open a business bank account?

It makes it easier to track your business’s inflows and outflows so you have a bottom-line accounting of revenue and expenses. It can be very challenging to do your taxes accurately at year-end if you have commingled your personal or family finances with those of your business.

Business bank accounts make it easier for you to give another person — like a business partner or bookkeeper — access to your transactions. And business bank accounts come with many tools not available on consumer accounts that make it easier for you to run your business.

Establishing a business bank account can also help you build your business’s credit profile .

What types of business bank accounts are there?

Three types of business accounts will help you operate your business.

• A business checking account allows you to accept deposits and make payments and serves as the core operating account for your business. A business checking account will also enable access to the many digital tools and capabilities your bank provides. Not all banks use the word “checking” to describe these business operating accounts.
• A merchant services account enables you to accept credit and debit card payments from your customers. It can be connected to your checking account.
• A business savings account or business CD account allows you to put money aside for taxes or big purchases. These accounts pay interest on the balance.

What is there to consider when picking a type of business bank account?

Here are some things to look at:

• Fees and minimum balances . Ask how much you will pay. Remember banks might waive fees if you keep a minimum balance or use your business debit card a certain amount.
• Cost of merchant services . This is the cost of accepting credit or debit cards, so estimate your monthly costs based on the size and frequency of your credit and debit card transactions with customers.
• Digital tools . Look for an account that provides access to business-specific digital capabilities such as cash flow tools, integration with accounting platforms and payment and invoicing abilities.
• Customer service . How easy is it to get help? Can you meet with someone in person if you need to?
• Perks or rewards . Many accounts and affiliated credit cards have point programs or membership programs that will provide incremental benefits based on your relationship and account balances.
• ATM access . Do you need to withdraw cash or to make deposits through an ATM?
• Branch access . If you need to visit a branch and speak with a specialist, how easy and convenient will this be? Many owners find that it is worthwhile to stop in regularly and build a strong working relationship with their bankers , who can be a source of valuable insight as a business grows.

Explore more

Get help finding the right products and services for your business

10 ways to help avoid business banking and credit card fees

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Bank of America, Merrill, their affiliates and advisors do not provide legal, tax or accounting advice. Consult your own legal and/or tax advisors before making any financial decisions. Any informational materials provided are for your discussion or review purposes only. The content on the Center for Business Empowerment (including, without limitations, third party and any Bank of America content) is provided “as is” and carries no express or implied warranties, or promise or guaranty of success. Bank of America does not warrant or guarantee the accuracy, reliability, completeness, usefulness, non-infringement of intellectual property rights, or quality of any content, regardless of who originates that content, and disclaims the same to the extent allowable by law. All third party trademarks, service marks, trade names and logos referenced in this material are the property of their respective owners. Bank of America does not deliver and is not responsible for the products, services or performance of any third party.

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Merrill Lynch, Pierce, Fenner & Smith Incorporated (also referred to as “MLPF&S" or “Merrill") makes available certain investment products sponsored, managed, distributed or provided by companies that are affiliates of Bank of America Corporation (“BofA Corp."). MLPF&S is a registered broker-dealer, registered investment adviser,  Member SIPC , and a wholly owned subsidiary of BofA Corp.

Banking products are provided by Bank of America, N.A., and affiliated banks, Members FDIC, and wholly owned subsidiaries of BofA Corp.

“Bank of America” and “BofA Securities” are the marketing names used by the Global Banking and Global Markets division of Bank of America Corporation. Lending, derivatives, other commercial banking activities, and trading in certain financial instruments are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Trading in securities and financial instruments, and strategic advisory, and other investment banking activities, are performed globally by investment banking affiliates of Bank of America Corporation (“Investment Banking Affiliates”), including, in the United States, BofA Securities, Inc., which is a registered broker-dealer and Member of SIPC , and, in other jurisdictions, by locally registered entities. BofA Securities, Inc. is a registered futures commission merchant with the CFTC and a member of the NFA.

Investment products:

Citizens Bank CD Rates

• Pros and Cons

How Citizens Bank CD Rates Compare

• Why You Should Trust Us

Today's Citizens Bank CD Rates: Earn up to 5.00% APY

Affiliate links for the products on this page are from partners that compensate us and terms apply to offers listed (see our advertiser disclosure with our list of partners for more details). However, our opinions are our own. See how we rate banking products to write unbiased product reviews.

Citizens Bank (Member FDIC) has two online CD terms: 8 months and 14 months.

Customers must live in select states to open one of these two CDs. However, residents of any state can open a CD with Citizens , the online-only division of the bank. Citizens (previously known as Citizens Access) has five CD terms ranging from one to five years.

Here's what you need to know about Citizens Bank CD rates.

Citizens Bank Online CD Rates

The Citizens Bank 8 Month Online CD pays a high rate, but you must deposit at least $25,000. This is significantly higher than the typical CD minimum deposit of $1,000 you can find at other banks. 

The Citizens Bank 14 Month Online CD pays a much lower rate, however, the minimum deposit requirement is lower. You need to deposit at least $1,000.

These two online CDs are only available for people who live near a bank branch. You can open an account if you live in Connecticut, Delaware, Florida, Maryland, Massachusetts, Michigan, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode Island, Vermont, Virginia, or Washington, DC.

The following rates are for Boston, Massachusetts. 

Citizens Access Online CD Rates

Regardless of where you live in the U.S., you can open a Citizens Access Online CD with Citizens, the online-only division of Citizens Bank. There are five term lengths, ranging from one to five years. Rates vary depending on the term, but the minimum deposit is always $5,000. 

Citizens Bank CD Pros and Cons

Citizens bank cds vs. capital one 360 cds.

Capital One 360 offers 9 CD terms ranging from 6 months to 5 years. Capital One CD rates are 3.90% to 5.00% APY, depending on the term length.

Citizens Bank and Capital One 360 offer similar rates, but Capital One 360 CDs have a $0 minimum deposit. Compared to the higher minimum deposits Citizens Bank requires, Capital One offers more flexibility. If you plan to deposit less than $1,000, Capital One 360 is a better fit.

Capital One 360 Review

Citizens Bank CDs vs. Synchrony Bank CDs

Synchrony Bank CD terms range from 3 months to 5 years, including a 24-month Bump Up CD and an 11-month No-Penalty CD. Synchrony Bank CD rates vary depending on the term, but you can earn between 0.25% to 5.00% APY.

The banks offer similar rates, but Synchrony offers extra flexibility with 16 term lengths and three types of CDs. There's also a $0 minimum deposit requirement at Synchrony, which is a significant perk compared to Citizens Bank's higher minimums.

Synchrony Bank Review

Why You Should Trust Us: How We Reviewed Citizens Bank CDs

Personal Finance Insider uses our certificate of deposit methodology to review CDs. We evaluated Citizens Bank's interest rates, CD terms, withdrawal penalties, and minimum deposits. We also considered the bank's mobile app, customer service, and ethics to determine a rating. We assign each category a score from 0 to 5, then average the scores together to create an overall rating out of 5.

Citizens Bank CD Rates FAQs

Yes, Citizens Bank is a Member FDIC bank. The FDIC insures money you deposit at the bank for up to $250,000 per account category and owner. If the bank fails, the FDIC will automatically reimburse you for the insured money you have in a CD. 

Citizens Bank pays 2.75% APY for a 14-month term and 5.00% APY for a 10-month term. Citizens, the online-only division of the bank, pays 0.05% to 5.00% APY depending on the term length. 

Citizens, formerly known as Citizens Access, is the online-only division of Citizens Bank. The financial institution offers a 1-year CD that pays a high interest rate.

Editorial Note: Any opinions, analyses, reviews, or recommendations expressed in this article are the author’s alone, and have not been reviewed, approved, or otherwise endorsed by any card issuer. Read our editorial standards .

Please note: While the offers mentioned above are accurate at the time of publication, they're subject to change at any time and may have changed, or may no longer be available.

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