Requirements And Cost Of Starting A Bank In Nigeria

Banking is the most difficult industry in Nigeria and around the world. Starting a bank in Nigeria requires lots of strategies, proper planning and very careful analysis of the industry.

Many banks are opening across the country, but only few stands the test of time. However with strategic plans the task of opening a bank can be made very possible.

We we will discuss about how to start a bank in Nigeria from scratch with the needed requirements.

8 Requirements Needed In Starting A Bank In Nigeria

1. Capital

When about starting your own bank you should as well be aware of the capital needed to start up a bank. This amount varies from million dollars and upward depending on the type of bank for operation.

In terms of capital if eventually your board of directors are investors they might be willing to invest their money to your venture.

There are also ways to raise capitals which includes special funding, private equity funds a bank holding Company, etc. Your starting capital (or required capital) ensures that your bank operation meet up the need of CBN (Central Bank of Nigeria).

2. Business Plan

A financial business plan of four to five years will be required for the projection. Your business plan should analyse how the new bank will profit, and how it will provide a beneficial services unlike other existing Banks.

Showing the plans for the growth and development of the bank will attract more investors.

Your business plan which in connected to your feasibility studies should be centred more on the market and customers to help you determine your services and products in order to satisfy and meet up with the needs of the society.

See also  Information About Starting A Coffee Farming In Nigeria

3. Obtaining Banking License

Starting a bank can be arduous which involves many legal processes and regulations that must be followed. These are banks which are permitted to carry on business in Nigeria: Commercial banks, merchant banks and specialized banks like mortgage banks, development banks and microfinance banks.

There three major stages for obtaining licence for banking business which are:

i. Grant of approval in principle
ii. Grant a final licence
iii. Pre-commencement of operation requirements.

You must be ready to fulfill the above requirements before you are Licensed to start your banking business in Nigeria.

4. Appoint A Board Of Directors

Normally it should be 6 to 15 people. They have so many importance and values to offer. For example the oversees the strategic plan of the bank, and makes sure the policies and regulations of the CBN are followed strictly by the employees.

Your board of members should have a vital knowledge about the banking sector. Be aware of this.

5. Location

Now that you have followed the steps and gotten your bank approved you will need to find a suitable place with smooth traffic.

Ensure that the location must not be around the competitive bank.
Now that you have also found a suitable place, you need to establish your bank.

You can construct a new building and as well make sure there will be enough space for a sitting area, a driver-thru teller, at least three personal banker officers, a vault, security guide station, an internal and external ATM, etc.

READ ALSO: The Requirements And Cost Of Starting A Petrol Filling In Nigeria

See also  Requirements And Cost Of Starting A Barbing Salon In Nigeria

6. Building An Appropriate Relationships

This involves establishing a relationship with customers, money transportation specialty companies (armoured car services) and other governing bodies Like the regulators.

7. Bringing Out Good Offers

Rendering some services and establishing some offers are also some of the aspects that progresses the bank.

Here are some of the services you can offer: checking, savings, mortgage loans, small business loans, investment and planning, short/long term savings methods, online banking option, etc.

8. Bank Marketing Strategies

You need a very good comprehensive marketing strategy to promote your new bank. Promoting a bank requires convincing people to trust a bank with their money and other tangible services they have to offer.

Here are some of the effective marketing strategies for your bank business: Facebook marketing, LinkedIn marketing, Google ads, Content marketing, Email marketing, Traditional or local promotion, etc.

Cost Of Starting A Bank In Nigeria

The cost of starting a bank in Nigeria solely depends on the type of bank for operation. But note that you will need up to millions of Dollars to establish a successful bank in Nigeria.

Please Help Us By Sharing: