Business current account - business plan required?

[fab4]

I've just had a look at the major high street banks and the Cooperative bank. It seems some more f them (Coop) require a business plan from start- ups in order to open an account. Is this the same for all banks even if no overdraft or loan is needed? I just need an account to separate my personal from my business finances and pay suppliers and fees for marketplaces like eBay.

I know. I know. Failing to plan..... But I'm more drawn to the business canvas method, lean start up and a full blown business plan would be overkill at the moment.

 

[IanG]

Not in my experience, I went in and told them I needed one and for what sector and they opened it. That was HSBC in 2011.

 

[UK Contractor Accountant]

Why don't you just open another personal bank account and run all your business transaction through that one?

The banks might get wind some years down the line that you are using the account for business and might then try to switch you to a business account with all the tariffs.

Saves all the rigmorol of business plan & forecasts.

 

[@aiteoconsulting]

Out of interest, do they specify what kind of plan they are looking for. Just wondering if there's a market for minimum cost business plans where the customer only wants it done to support opening a bank account...

 

[MyAccountantOnline]

I've just had a look at the major high street banks and the Cooperative bank. It seems some more f them (Coop) require a business plan from start- ups in order to open an account. Is this the same for all banks even if no overdraft or loan is needed? I just need an account to separate my personal from my business finances and pay suppliers and fees for marketplaces like eBay.

I know. I know. Failing to plan..... But I'm more drawn to the business canvas method, lean start up and a full blown business plan would be overkill at the moment.

I bank with Barclays and am not aware its a requirement.

 

[UK Contractor Accountant]

The co-op buisness account application says it only needs a business plan if you have traded for less than 6 months.

 

[IanG]

I wasn't trading, in fact I went in during a lunch hour from a job I was getting made redundant from. That's how much of a plan I had.

 

[Mark T Jones]

The banks are obliged to 'tick the box' that you have adequately demonstrated that you are a serious and legitimate business.

For start-ups, a simple business plan should achieve this (that is a short, concise outline of how the business will operate, not 100 pages of B/S and waffle). They might accept other things, like a confirmed order of confirmation of contract.

 

[Rehan Durrani]

Over the last couple of years there have been some major changes in the way the banks are dealing with businesses when initially setting up - but as explained above, a lot of it is more "ticking the box" to ensure the bank has investigated the individual and business to some extent prior to setting up an account.

From experience, despite these changes written business plans have not been an issue or required. All of our UK based clients have been able to set up business bank accounts (be it self employed or limited companies) without a formal business plan, but rather a very simple verbal explanation of the nature of their trade or letter from ourselves explaining the same.

If you are non-resident in the UK, then there are a few more questions. A brief business plan has been necessary here, explaining the nature of the business, funding, clients and suppliers (if any). But again, it's brief.

 

[BigTree]

I opened a Business Account with Barclays last week. Didn't need a Business Plan just an interview.

However it helped I've banked with them personally for over 30 years and it's a Ltd company. As it was newly registered he waited until it showed up on his system before submitting the application as he said it then automatically ticked all the boxes.

He also advised to wait 12 months of trading before requesting an overdraft or loan as it'll be far easier to approve with a 1 year history. In fact he said a business credit card would likely be easier and cheaper in the short-term.

 

[Edith@TerraNetwork]

Never needed a business plan but my business account is with the same bank as my personal account, so the bank knew me. Maybe write a short 1 page summary just in case, but don't waste too much time on it.

 

[Scott@KarmaContent]

I started with Santander last year, no business plan required.

 

[Rehan Durrani]

Just to add: For all of our recent clients, whether they have been existing customers of the respective bank or first time customers - in all cases there was no business plan required.

 

[Nord20]

I wasn't trading, in fact I went in during a lunch hour from a job I was getting made redundant from. That's how much of a plan I had.

And this is precisely why they should ask to see a business plan, although they are not obliged to, to make sure you aren't just a numpty who is wasting their time and/or going to use the account for something other than what was originally specified, which in your case, was basically whatever you felt like.

Just do a business plan - a full blown plan can be as short as a paragraph, if that is all you need to explain what you intend to do. If you know what you plan to do, just write it down. If you don't know what you plan to do then....then I guess a fool and his money are easily parted.

 

[IanG]

I tend to prioritise things which are necessary and avoid those which are not.

If you want to waste time, crack on.

The question specifically relates to obtaining a bank account which is a distress activity and not something you want to be doing in the course of normal business. ie. spend as little time as you can on it.

By all means take it if you're really that short on confidence that you need someone who is paid to open you a fee paying account convince you that your idea is good enough to open you a fee paying account.

If you want business advice, write the plan and post it on here. Or take it to a professional somewhere. But some guy in a bank who hasn't even asked for it wouldn't be my first choice.

 

[Nord20]

Your business plan is first and foremost for you. If you think you can just plow ahead without thinking through the risks and opportunities, knock yourself out, you may get lucky. Most people recognise the value of a business plan.

 

[IanG]

I didn't say don't plan.

I said don't take it to the bank if the bank haven't asked for it.

Nothing to do with luck.

 

[Nord20]

I tend to prioritise things which are necessary and avoid those which are not.

If you want to waste time, crack on.

I read this as creating a business plan not being necessary and being a waste of time (so yes, it did appear that you said don't plan). Coming after your previous comment where you were basically gloating that you were starting your business in your lunch break having been made redundant with no plan, I don't think it was an unreasonable interpretation of your words, but if that is not what you meant, then obviously I have the wrong end of the stick.

The only point I wanted to make is that you really should have a business plan anyway, so it makes no difference if you have to show it to your bank or not. Getting your bank onside from day one and instilling a sense of confidence in them can be very useful further down the line when you inevitably need something from them, but again, entirely your call.

Believe it or not, 'that guy' in the bank who spends all day long reading business plans and deciding whether to approve new accounts or not probably does have quite a good eye for what has a chance of being successful and what doesn't and getting advise from your bank never hurt.

 

[Capple]

I'm in the middle of setting up my business and went with my bank (Barclays) for a business account. I met with an account manager and they'd asked loads of questions about the business. So I wouldn't say it was a business plan as such but there were plenty of questions asked

 

[Alex77789]

Useful information)

 

[lee246]

I've just set up a business account with NatWest for my start up Ltd Company. It involved filling out an online form, then having a 30 minute chat over the phone with a NatWest employee, then being emailed the documents, filling then in and emailing them back. A couple of days later I get confirmation it's all set up. Completely painless.