An NBFC business plan plays a vital role in augmenting the company’s credibility among stakeholders and potential investors. It is not merely a sneak peek into what the company is all about or what it offers, it is a brief roadmap, outlining key information such as its mission, vision, management hierarchy, objectives, marketing plan, etc. Let’s delve into how you can create a pragmatic 5-year NBFC Business Plan for gaining traction among potential investors and invaluable stakeholders.
Underlining the Significance of a 5-year NBFC Business Plan
The NBFC Business Plan outlines every possible detail about the business, giving a sneak peek into its potential, future, investment, marketing endeavors, financial projection, services on offers, risk mitigation strategies, strengths, and weaknesses.
Unlike a plain brochure, which primarily showcases the portfolio of services on offers and company information, it is all-encompassing and delivers more value; allowing more investors to get on board and reinforcing transparency among stakeholders.
Besides, it helps employees to know better about their company, its functionalities, core competencies, and management- alleviating ambiguity and amplifying performance.
Key Considerations for the 5-year NBFC Business Plan
Every business plan that lacks the gravity of the present scenario and market situation is just a plan with no tangible outcome. Considering the following parameters are vital to devise a successful NBFC business plan.
Technological Advancement
The banking sector has undergone significant technological advancements with blockchain and cloud banking being the primary contributors. The fundamental gaps that lead the poor banking performance no longer exist. Every NBFC must adapt to this game-changing transition to enhance their services and include the same in their business plan.
Digitization of services
Digitization of redundant banking activities has taken the performance to the next level. It overcomes menial chores and streamlines the entire operation with no scope for errors or security issues. Digitization is not an option anymore; it is an absolute necessity for banking and financial entities to cope with cut-throat competition.
Ever-changing Customer preferences
These days customers are increasingly using digitized services for their banking needs. They avoid visiting banks physically because it is tedious and time-consuming. The number of users for online banking is increasing like never before, therefore not considering this in a business plan would be unwise.
Illustrating Key Contents of 5-year NBFC Business Plan
NBFC Business Plan spans diversified information classified chronologically under different headings as shown below:
1. Executive Summary:
The executive summary talks about the business’s core aspects, rendering a sneak peek into the company’s mission, market consideration, offering, and management.
2. About Us:
This section provides general information such as what the company does, who are the founding members, and who are decision-makers, giving a glimpse of the legal structure.
3. Industry Information:
This section unveils details concerning the industry landscape, services on offer, market size, strength areas, and external threats.
4. Unique Selling Proposition (USP) of Business:
Defining what makes the company stand out, and how the company is ensuring top-notch customer support. Frame this section from the customer’s standpoint; ensuring the clarity on what value beneficiaries get from your services.
5. Organization Hierarchy:
This section elaborates on the organizational hierarchy, reflecting the chain of common, roles and and responsibilities in a logical order.
6. Products and Services:
This section primarily talks about the product portfolio, customer segmentation, risk mitigation strategies, loan disbursement, and management processes.
7. Sales Ecosystem:
Elaborating on factors contributing to sale generation, this section sheds light on the personnel and resources that bring the sales ecosystem to life.
8. Corporate Governance:
Corporate governance spans rules and guidelines that reinforce transparency, ensuring ethical business practices.
09. Risk Management and Mitigation:
Highlighting what risk and mitigation management is in place to stay ahead of the potential and imminent threats.
10. Policies:
Elaborating policies concerning internal affairs and service facilitation (including credit and underwriting policies), ensuring consistency and control.
11. Revenue Means:
This section covers revenue-generation methods, spanning sales, rents, interest on borrowings, and recurring payments.
12. Core Business Milestones:
Setting practical goals with specified deadlines, and business milestones include achievements like a proven business model and ensuring success in the market.
13. System Specifications:
Unveil details concerning the System Requirements Specification (SRS). It reflects the requirements, features, budget, and deadlines for critical project management.
14. Customer Acquisition:
This stage highlights customer acquisition strategies, including sale funnels in use. It must also show what is the overall cost of customer acquisition (CAC).
15. Proposed IT Infrastructure:
A sneak peek into the prevailing IT infrastructure, illustrating details relating to necessary equipment, applications, and staffing.
16. Business Launch Plan:
This plan showcases undertakings and due dates for launching new products or services.
17. 5-Year Financials:
Past, current, and projected financial states are provided in this section, rendering meaningful insights to determine the business’s future. This will enable potential investors to make informed decisions.
Conclusion:
The 5-Year NBFC Business Plan is not just a plan on paper; it is the comprehensive outlook of the company’s DNA, its goals, its weaknesses, its strategies, and everything in between. Its benefits transcend empowering investors or enhancing credibility; it can help build trust among employees and guide them to deliver their best performance.
