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Banks & Banking

How to Start a Bank




In a vast and fast-growing county like Nigeria, we are faced with an ever-increasing population which has variegated financial needs. This creates the need for the establishment of more banks to meet these needs and/or which can solve the issues inherent in present-day banking activities. For some people, the issues relate to certain banking polices while for others it is trust issues. These drive their patronage to other banks. As a smart business investor, you should key into this situation, see it as an opportunity and start a bank in Nigeria as soon as possible.

The establishment of banks nationwide is something that cannot run out of significance because of the population of businesses and financial transactions. According to statistics, 43% of citizens living in Nigeria either operate an account or intend to do so. Different banks cater to different interests. Some of these interests may be on an individualist level or a corporate level.

Before I give you full details on how to start a bank, let me tell you the different categories of banks available today.

Categories Of Banks In Nigeria

Amidst the numerous banks scattered across the country, we can classify them into three distinct categories. These categories have all been permitted to carry out operations in Nigeria by the BOFIA (Banks and Other Financial Institution).

They include:

  1. Merchant banks,
  2. Commercial Banks, and,
  3. Specialized Banks, some of which includes non-interest Banks, mortgage banks Microfinance Banks and Development Banks.

All the categories mentioned are licensed to operate under the guidelines of the Central Bank of Nigeria (CBN). They may be owned privately or by the government.

Steps to Start a Bank

Steps to Start a Bank in Nigeria

Gain Sufficient Knowledge Of The Financial Service Sector

Unlike other sectors, the financial sector is quite a complex aspect to deal with. You need to gain relevant knowledge of money and what it takes to run a system as complex as that. By doing so, you arrive at a higher level of financial knowledge to help you satisfy your customers and meet their demands.

There are a lot of rules guiding the operation of the banking sector. You need to arm yourself with these relevant information before you set out to start a bank. What am I saying here? I am saying that you need to be well-vested in the running of a bank. This you can get by studying Banking and Finance at a Tertiary Institution in Nigeria or Overseas, especially a University.

Obtain the Appropriate Banking Experience

To be able to operate and handle a bank, you need as much experience as you can get. It is not as simple as you can have in coffee shops, supermarkets, or even schools. You need a wide range of encounters in and out of the system to build your survival rate in this sector.

You need to make comparisons with other banks and understand how they are being run. As you would notice, there are some sensitive details you won’t get until you get hands-on experience or have someone share with you what exactly operating a bank entails.

This is why you won’t find bank owners who haven’t served in the system. As they grew in ranks and experience, they were able to set up theirs.

To help you build a solid and adequate knowledge-base, you need to have passed through series of educational trainings and certifications. This alone doesn’t guarantee that you are well-equipped to handle the pressure from the provision financial and non-financial services in a bank. You would also need managerial and business skills to plow your way to success.

Decide On The Type Of Bank You Want To Operate

Earlier, I established that there are different types of banks that are established in the country. You need to know which one of them that you would love to open. The different bank types have their unique requirements and demands. The level of preparation and procedures for establishment and operation of each of them is also not the same. You need to know what category you are ready to embark on.

Conduct Thorough Feasibility Study Based On Your Category

Having the desire to establish something doesn’t automatically mean it would turn out fine. The major reason why a lot of businesses fail is that there are no accompanying researches and studies done to know the areas of strength. Every business comes as a solution to a pitfall or limitation of another.

To make your bank successful in customer satisfaction, you need to understand what financial service(s) customers complain of in other banks and how you can solve this challenge in your bank. This means most of your findings would revolve around the customers.

Raise The Necessary Capital and Partners

Since you’ll be in charge of people’s funds and resources, you need to be able to convince accreditation bodies that irrespective of whether there are flops in the amount of capital generated, you can still disburse what the customers have entrusted into your hands.

Your customers are looking forward to having their money multiply in their accounts. It is now up to you to determine how this money will be used to generate more funds either through loans, investment and so on. This is why you are required to provide a huge amount of startup fines amounting to thousands and millions of dollars.

After successfully meeting up the target to begin with, you need to start scouting out for partners. Their duty is to invest in your bank and receive a percentage as return or profit. The partners who invest with you must have a well-defined financial means to avoid incrimination.

Obtain Your License From

Now, proceed to the Central Bank of Nigeria (CBN) for accreditation and issuing of licenses. While this process takes a stipulated time, you must ensure that you provide maximum security for the money entrusted into your hands by your customers. This will be well vetted by the licensing department of the CBN and any other regulating institution.

Get A Suitable Location For the Business

Properly siting a business is sine qua none to business success. Hence, from the early stages you must give proper consideration to where to intend to establish your bank. You might have a couple of addresses in mind to choose from. However, you must select a place that matches your business needs.

Whether the land is purchased or leased, you cannot afford to make mistakes with your choice of location. The location of your bank should be at a place that is easily accessible and safe. Customers will not patronize you if the bank is in a hidden area.

Engage in Aggressive Marketing and Advertisement

Banks experience so much competition from other banks who desire to have as many customers as possible. It is now left for you to draft out a means to reach out and inform others of the service you offer and how your services would benefit them the more compared to other banks.

This can be easily achieved through professional marketing and advertising campaigns. Your presentation of your bank services to the public will determine if they see you as one who thy can do business with or not.

Maximize tools like the Social media, Television, Radio, Newspapers and Publishing Houses to spread your information. You can also spread word on the streets and marketing centers through special campaigns that bring you closer to those who would need financial services.

Thank you for taking the time to go through this article on how to start a bank. I hope that you learn from this and use the information contained herein to your maximum advantage. Have a pleasant day!



Banks & Banking

Fixed Deposit Vs. Treasury Bill In Nigeria: What Is The Difference?




Many Nigerians find it hard to differentiate between fixed deposit and treasury bill in Nigeria If you are one of them, then worry no more because in this post I discuss the main difference between fixed deposit and treasury bills in Nigeria.

First, What is a Fixed Deposit (FD)?

A fixed deposit usually abbreviated “FD” is a type of investment account that pays a fixed rate of interest to investors over and until a given date. While the fixed deposit runs, the investor would not be allowed to withdraw his or her funds.

Because of the higher rate of interest when compared with savings account, many people tend to put their monies in fixed deposits. Besides this, fixed deposits provide other advantages like tax benefits, safe investment, flexibility, and liquidity. All these intrigue many investors to prefer using a fixed deposit to an ordinary or augmented savings accounts.

But as we all know, whatever have advantages must have disadvantages and fixed deposit account is no exception. The most known risks that fixed deposit faces are inflation risk, default risk, reinvestment risk, liquidity risk, and interest risk.

Fixed Deposit Vs. Treasury Bill In Nigeria: What Is The Difference?, fixed deposit and treasury bill

Fixed Deposit Vs. Treasury Bill In Nigeria: What Is The Difference?

What is a Treasury Bill?

Treasury bills in Nigeria are debt instruments issued by The Central Bank of Nigeria (CBN) and are guaranteed by the government. The central bank of Nigeria (CBN) uses treasury bills as a way to control the money supply in the country’s economy.

These bills are sold bi-weekly by auctions conducted by the Central Bank of Nigeria, and you can buy these bills from any official dealer or through banks’ Treasury bill applications. The Treasury bill is a safe form of investment that is fully backed by the Federal government of Nigeria.

Treasury bills have a lot of investment advantages and upper-hand. Few among them are:

  1. Treasury bills serve as good investment outlets,
  2. are non-taxable,
  3. they can be used as collateral, and
  4. can be converted to cash quickly.

Don’t get too engrossed, we’re talking about the difference between fixed deposit and treasury bill.

The Remarkable Differences Between Fixed Deposit And Treasury Bill In Nigeria

Below are some of the key differences.

  1. Fixed deposits are fixed for an allotted period and are sold daily by banks to their customers while treasury bills are sold bi-weekly.
  2. Fixed deposits are primarily sold and managed by small banks while treasury bills are managed only by the Central Bank of Nigeria although you can buy them through commercial banks in the country.
  3. In a fixed deposit, depositors invest their money with a bank and will be given interest at a given time. In Treasury Bills, an investor borrows money to the Central Bank of Nigeria (CBN) for an allotted period in exchange for interest.
  4. While fixed deposits are done for one month, six months, or a year, treasury bills are usually for a period of 91 days, 182 days, or a year.
  5. Fixed deposits are fully taxable while treasury bills are non-taxable; you only pay a bank fee for the rendered service.
  6. The interest gained in treasury bills is far higher than the one offered by banks in fixed deposits.
  7. Treasury bills allow more liquidity than fixed deposits because they are done for the short, semi-long and long term.
  8. Treasury bills are regarded as the safest and risk-free investments because the government can never run out of funds while fixed deposits are only secured as long as the bank is functioning.
  9. The Central Bank of Nigeria (CBN) always puts a limit to the number of treasury bills it will sell while there is no limit to the fixed deposits that are sold by banks.
  10. Treasury bills money are used by the Central Bank of Nigeria to control the supply of income in the economy while fixed deposits are used by banks for investments.
  11. Fixed deposits can be rolled over by banks as it is a way of saving and investing at the same time while treasury bills cannot be rolled over.
  12. The flexibility in fixed deposits is far more than the one in treasury bills. Because in fixed deposits, you can easily get your cash anytime you want it and you will get the interest you earned for that time, while in treasury bills if you have wanted to withdraw your money before the allotted time, you have to sell the rights of the treasury bills to another person or a bank.
  13. Treasury bills are accepted by all banks in Nigeria as collateral because they are considered risk-free while some banks do not accept fixed deposits as collateral because they do not consider the other banks as strong ones.


Both fixed deposit and treasury bill are good forms of investing. While fixed deposits allow you to withdraw your money at any time, treasure bills do not allow that, but they are considered safer because the government cannot go out of funds. While there is a high possibility of a bank going out of funds thereby dissolving your money in fixed deposits that is not the case with Treasury bills! So, if you are cautious of risks, then you should opt for treasury bills over fixed deposits.



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Banks & Banking

How To Get Business Loan in Nigeria




Today, I want to talk to you about something that is very important to business growth in Nigeria: how to get a business loan in Nigeria. A lot of businesses need a loan to improve their businesses because finance is a cardinal fuel for business progress. Loans may be gotten with or without interest, depending on who is giving the loan. Also, loans could come with or without collateral.

Collateral is something like a car, a house, a piece of land that you own, and/or any other tangible asset which is yours or which you have claims/rights to. Today in Nigeria there are many platforms, especially mobile apps, through which you can access loans without any collateral.

However, there are limitations to the use of such platforms the most typical of which is the limitation on the volume of loan sum which a business can get. For you to get a meaningful loan sum, you would have to contact a financial house like a bank, private loan givers, and non-bank corporate entities which provide high-volume loan facilities.

Business Loan in Nigeria

A business owner applying for Business loan in Nigeria

Typically, the 3 ways to get a business loan in Nigeria are:

  1. Getting a loan from relatives, friends or family
  2. Getting a loan from microfinance banks in Nigeria and
  3. Getting a loan from commercial banks in Nigeria

Often, options 2 and 3 above are usually most people’s favorite. Based on the information at my disposal, I will throw some light on the third option and give you some insight into the criteria for getting a loan from 4 commercial banks in Nigeria today.

The beautiful thing about this is that these commercial banks actually give business loans to small businesses collateral-free (at least as of the time of writing this). Things might change in the future. So, do well to re-check the criteria before you apply for and obtain a loan from any of the commercial banks in Nigeria that I discuss below.

Also, it is advisable to visit the banks and check if you meet the criteria that they set for getting a loan to finance your business. For now, some banks which give business loans in Nigeria are Wema Bank, Heritage Bank, First Bank of Nigeria Plc., and Stanbic IBTC Bank.

Let us review how each of these banks and the business loans that they give:

Wema Bank

Wema bank through its collateral-free loan has created an atmosphere for business owners to think big, start small, and eventually become successful. The loan which Wema bank gives to businesses ranges from N100,000 to N1 million without any collateral.

However, to qualify for this offer, the borrower needs to operate a business account with Wema bank and have a record of a steady transaction of about six months in his/her corporate business account with the bank. This means that will give you a business loan ranging from 100,000 to 1 million if you have operated a business account with them for six months.

Kindly walk into any branch of Wema bank to get more information on this.

Heritage Bank

Heritage Bank seeks to harness the skill and entrepreneurial spirits among Nigerian youths by providing timely and cheap loans to assist entrepreneurs to implement their business ideas. The bank also has a special package for NYSC members.

Heritage Bank’s loan facility is aimed at helping people in Nigerian marketplaces and whoever needs access to business finance through short-term borrowing from the bank. Kindly visit them to get more information on this.

They have a loan facility for people who want to start up small businesses and need between fifty thousand and 400 thousand upwards. There are loan packages for operators of large scale businesses.

Please, visit the bank to get more information on this. Some of their loans are collateral free with a few stipulated conditions attached.

Business Loan in Nigeria

First Bank of Nigeria (FBN)

First Bank of Nigeria (FBN) offers bank loans that are easily accessible to entrepreneurs irrespective of the type of business insofar as it is not illegal business. To be qualified for this loan the only thing required of you is to undergo a psychometric test and pass it.

Thereafter, you will provide the bank with your business plan and financial projections. They need your business plan to see how viable your business is and your capacity to repay the loaned sum. If you can convince and assure them of your capacity to repay your loan, you will be given the loan to fund your business.

Standbic IBTC Bank

The majority of Standbic IBTC Bank loans are designed to assist Small and Medium Entreprises (SMEs) acquire business assets and other facilities. The criteria for getting a loan from Standbic IBTC Bank are not enormous. Also, the loans given by the bank to SMEs are collateral free. If you are a big business you might need to present collateral.

To get a loan for a small business from Standbic IBTC Bank, you have to provide the full names and capacities of those who constitute the management team of the business. Also, you must state the reason why you need the business loan.

You would also provide:

  1. your business financial statement including an income statement,
  2. balance sheet,
  3. cash flow statements,
  4. personal statements of assets and liabilities of all partners in that business
  5. members and directors 12-month cash flow forecasts or financial projection,
  6. the amount of your own equity contribution.

The list above is really exhaustive, a bit complex but I suggest that you visit Standbic IBTC Bank to get more information about this. Again, this is for interest-free loans. So, kindly visit the bank to find out more about other loan packages.


Just like I said when I started this discussion, the best place to get business loans in Nigeria to a finance business today is the banks. This is because banks have the capacity to offer large loan sums. However, you can also get loans from your friends, relatives, associates and family members to finance your business. If you wish to use the bank, you need to visit the banking halls to get more information on how to get loans.

Also, remember that there are various loan packages available for you to choose from. So, you would have to choose the one that best suits your business needs. Different banks operate differently and have different loan packages for different classes of businesses. Some banks business loans come with interest, others don’t. Any of these can be assessed in the form of revolving credit, installation payment, order contract finance, etc.

This article explained some banks in Nigeria that offer business loans for startups and established businesses, collateral-free. You can contact these banks to get a loan to support your business.

It is advisable to visit these banks and get detailed information on how to access their loans instead of relying for unverified information on third-party blogs and websites. The five banks in reviewed in this article are Wema bank, Heritage bank, Stanbic IBTC Bank, and First Bank of Nigeria Plc (FBN). So, if you need a business loan I would suggest that you visit the banks and get detailed information about how to access loans especially loans without collateral.

Have you heard of Sumobank? Do you know you can save and make good returns on your savings with Sumobank today? To learn how to get business loans and improve your savings, click here to visit Sumobank

Thank you and have a splendid day ahead.



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Banks & Banking

How to Avoid BVN Name Correction Issues in Your Bank Account

Raphael Orji



BVN name correction

How to Avoid BVN Name Correction Issues in Your Bank Account

BVN name correction – Have you been denied access to your hard-earned funds in any Nigerian bank, are there accounts you abandoned because you’ve been so stressed about BVN without any solution in view, the concept BVN to you is a classified nightmare?

If any of the above lines sounds like you, then this guide “BVN Name correction” is meant for you.

I will implore you to sit tight going into this guide, this is firsthand information you will part with a fortune to get if at all any specialist is willing to walk you through. For the benefit of being an reader, here you’ll have it at no cost to you.

In line with the topic of this guide, you will as well get cleared on the following:

Ø  How to change BVN phone number

Ø  How to change BVN phone number online

Ø  BVN registration portal

Ø  BVN linker

Ø  How to correct BVN date of birth and many questions will be treated as we advance.

For a better appreciation of this topic and knowledge base, let’s take a look at the concept of BVN itself.

Related: How to check bvn code and link with your multiple accounts

What is BVN?

Simply put “Bank Verification Number.”

This is a unique eleven digits number assigned to every bank customer by the Central Bank of Nigeria aimed at checkmating money laundry and terrorism financing alongside other financial related crimes being carried out or aided through the bank.

Recall, the history of BVN in Nigeria dated back to 2014, it helps identify individual customers by the aid of physiological features like fingerprints and signature.

With this evolution, it then stands that there are no two customers or humans who have the same fingerprint (A biological study on physiological and morphological variations explains that better).

With that in mind, do also understand that no two customers have the same BVN number.

Application of BVN

Example 1.

Let’s say Mr. Donatus Okoye wants to access a facility of N1,000,000 from bank ABC. On his loan application, the bank foremost carries out a Credit Risk Management Assessment (CRMS) on him.

The essence of this exercise is to ascertain that Mr. Donatus is not owing to any other Commercial, Microfinance bank, or credit institution in Nigeria, which is order wise referred to as integrity on his credit score.

This process will also expose any financial indictment on his person on the course of his monetary dealings with the Nigerian financial institutions.

This ranges from financial fraud, Money laundry and terrorism financing, you just name them.

How then will the bank know the financial history of Mr. Donatus since he probably has never been involved in any financial transaction with bank ABC in the past?

The answer lies in his BVN, BVN is a mirror that gives an insight into your financial history and involvement, irrespective of the bank.

Away from that, let’s get back to the main topic, still on BVN name correction.

You do not cure an ailment without recourse to its remote cause.

Related: Bank Verification Number (BVN): 7 things you should know

Why BVN Correction?

A number of factors gave birth to this trend, these include:

Ø  Wrong date of birth captured during account opening or BVN capturing

Ø  Wrong name used in either bank account or BVN

Ø  Change of name by marriage and personal reasons

The above are the major reasons that often times necessitate a correction on someone’s BVN details.

Wrong Date of Birth Captured During Account Opening or BVN Capturing

This is a common practice where customers go about opening accounts with fictitious dates of birth, they are ignorant of the impending or looming dangers of these practices ahead.

Funny enough, their accounts in three or more banks have different dates of births prior the BVN system in 2015, on the arrival of BVN, such accounts cannot be linked with their BVN which supposedly as well as a different date of birth.

Look at the below scenario:

Example 2

Mr. Ade Tokunbo, a customer of bank ABC, has a savings account with the aforementioned bank with his date of birth in the following order 09/05/1980.

He as well proceeds to bank DEF, opened a current account with his date of birth 12/16/1980 as well.

In view of the above, while being profiled for BVN, he issued 07/06/1980 as his date of birth as well.

From the scenarios under review, his genuine date of birth happens to be that with bank ABC.


Bank ABC cannot link his BVN to his account despite being his pioneer bank, irrespective of where the BVN was profiled.

Bank DEF as well cannot link the said BVN to Mr. Ade’s account either, why?

The date of birth on the account is different from that seen on the BVN.

This is usually discovered during BVN linkage, and according to CBN instruction, no such BVN with irregular details should be linked to an account, it’s considered details irregular and it stands at that.

This is a burning issue that customers like you are going through, sadly enough, a handful of customers are still doing this as I write this piece.

Learning point

Ensure to supply your genuine date of birth when feeling bank documents. That leads us to the next error.

The wrong Name Used in Either Bank Account or BVN

I haven’t just come to terms with why you should choose to provide half-baked information to the bank while opening an account or registering for your BVN. That on its own is suicidal and criminal.

If you have a thousand names, why not choose specific three or two to maintain your official information as this. It wouldn’t kill you or change your status whatsoever.

Whatever name you supplied to bank ABC should be applicable to bank DEF, every detailed instruction in the example 2 above should apply to this case.

Change of name by marriage or personal reasons

This is the most acceptable reason for the three, it’s direct and reasonable enough. Once a woman got married to a man, it’s customary that things will have to change, the surname to start with.

How to Avoid BVN Name Correction Issues

This is about the most fascinating aspect of this guide, I promised to show you how to avoid getting your fingers stuck in this BVN issues, it’s not a palatable one, ask a friend or family who’d gone through it. Only then can you appreciate the piece you’re reading right now.

You can avoid BVN issues by following these simple steps:

Ø  Before you visit a bank for account opening, kindly go with a valid ID card that contains the name you wish to be addressed with and the correct date of birth.

Ø  While filling the account opening form, ensure you enter your correct name as contained on your ID card and correct date of birth in the columns provided neatly and accurately.

Ø  As a note, remind the customer service officer of the need to capture your name exactly without missing any letter, as well the date of birth while inputting your details on the system. Some may feel embarrassed but you just have to, they most often go careless on customer details, which thereafter amounts to serious issues.

Ø  While enrolling for BVN, write your name and date of birth neatly and correctly on the BVN enrolment form.

Ø  While being captured by an officer on the BVN platform, remind them to pay special attention to your name and date of birth. They must not miss or interchange a single letter not even a number should be captured/inputted wrongly.

If you follow the above steps religiously, I assure you the possibility of having the BVN name correction issue will be next to zero. I hope you’re pleased to discover this simple but yet vital information.

However, in any case the deed has been done and you’re looking up to a way for possible correction on your BVN/date of birth or account name.

Follow the below steps

Ø  It’s assumed you’ve visited your bank and had been informed of the anomaly in your account and BVN.

Ø  Kindly seek advice from the customer service officer on the way forward which most probably will be

Ø  To get a court affidavit either for name correction/change or date of birth as the case may be

Ø  You are expected to publish same on a national daily except where stated order wise

Ø  Having acquired the affidavit, get back to the bank. This correction should be effected within 24 hours of meeting this requirement.

Ø  In some cases/banks, the correction is effected immediately in the bank if the discrepancy has meddled with the account name again if the bank is the BVN and account domiciled branch.

Ø  Once this correction is effected, it will be done across banks, where your accounts are domiciled.

How to change BVN phone number

Why exactly will a customer want to change his or her phone number, probably he/she no longer has access to the phone number associated with the BVN? To achieve this,

Ø  Kindly visit your enrolment bank

Ø  Communicate your intention to change your BVN phone number

Ø  You will have to fill a BVN correction form

Ø  Provide your valid ID card with your name and date of birth correctly written

Ø  Fill in your now preferred phone number correctly

Ø  Your BVN phone number will be changed within 24/48 hours at most

Ø  Some banks may require you to get an affidavit

How to change BVN phone number online

You cannot change your BVN phone number yourself, you can’t do that online. Only an authorized agent bank can start this process.

BVN linker

This is the practice in which you link BVN to your various accounts as domiciled with different banks. You can do this by visiting the bank branch, submit your BVN for linking after which you will be able to effect withdrawal on your account.

To link it yourself read: How to link BVN to your bank account


BVN name correction is not a herculean task as many customers would perceive, it, however, becomes a nightmare when you fail to adhere to the operational and correctional procedures.

I will always be here to entertain your questions, listen to your challenges as well as proffer solutions where applicable to ensure the issue of BVN name correction no longer makes you uneasy. In the mean-time, thank you for the audience.



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