financial franchise 2022

The Best Financial Franchise Opportunities in 2022

8 min read • Mar 18, 2022 • Barry Eitel

The economy is on everyone’s mind in 2022, with everything from the housing market to inflation making headlines. If this has you considering your first (or next) small business opportunity, this may also have you considering financial franchise opportunities. A financial franchise allows you to open a business with an established brand presence. Even if you aren’t a CPA or licensed bookkeeper, many franchisors provide the small business know-how you need to get started.  

What Is a Franchise?

You might think of a franchise agreement as allowing the franchisee to open up an outpost of the main business. McDonalds, 7-Eleven, Ace Hardware, and Marriott hotels are all very common franchises. But a franchise is really just a type of license agreement between a small business owner (called a “franchisee”) and a bigger company. As part of the agreement, the franchisee gains access to proprietary business knowledge, trademarks, processes, products, and branding of that bigger company or franchisor.

The franchisee gets to run a business with a recognizable brand and a track record of success. The franchisor is paid in return, usually in the form of initial startup fees and annual licensing fees, although agreements vary.

If “franchise” brings to mind McDonalds and Subway, know that there are other options too, including financial franchises.

What Is a Financial Franchise?

A financial franchise is a franchise that offers services within the financial service industry. There are franchise opportunities for entrepreneurs interested in small business financing, tax preparation, bookkeeping, and more. Some of the brand names in the financial sector you know well, including Lendio, Allstate, and H&R Block, have franchise opportunities—but there is a whole universe of options.

Categories of Financial Franchise

There are financial franchise opportunities across the financial-services spectrum—and ones that customers badly need. We pay taxes, we open businesses, we need financing, we pay employees, and we know everything should be insured—all opportunities for a financial franchise to assist us. 

Key Franchise Sectors in the Financial Services Industry

  1. Small business lending
  2. Tax preparation services
  3. Accounting, bookkeeping, and payroll
  4. ATMs
  5. Insurance

Financial franchise services can also be combined easily into a robust business appealing to a wide swath of customers. With a Lendio franchise, for example, you can offer financing help as well as bookkeeping services.  

1. Small Business Lending

A small business lending company is one of the most profitable types of financial franchise—and it’s relatively accessible to open as an entrepreneur. These types of franchises find loans and other funding for small businesses. In many cases, you don’t need to open a physical office, and you only need around $55,000–$65,000 in liquid capital to start.

2. Tax Preparation and Services

Tax preparation franchises are very common forms of financial franchises—you’ve probably seen H&R Block or Jackson Hewitt franchises in your area. Depending on the company, you do not need to be a CPA or tax professional to open a tax preparation franchise, because they put you through rigorous training. Since people and businesses will always need help with their taxes, these types of franchises remain popular.

3. Accounting, Bookkeeping, and Payroll

While many CPAs, accountants, and bookkeepers open their own solopreneur business or independent small storefront, there are several franchise opportunities for these roles as well. Since accounting is often the last thing entrepreneurs know how to handle, it’s logical that many will outsource this factor of operating a company. You may not need to be credentialed to open an accounting franchise, but it helps to be a licensed CPA, CFA, or another financial professional.

4. ATMs

Even in this digital age, we all need cash sometimes. You can open a franchise that installs and maintains ATMs—a great way to get into a financial franchise without a huge infusion of startup capital. This type of business can be a particularly strong fit for an entrepreneur looking for flexible hours. It’s also great if you want to be on the road more and in the office less, especially if your staff is small.

5. Insurance

Insurance is a big enough business to be considered its own field, but it is technically a part of the broader financial industry. Many insurers have franchise opportunities, like Allstate and Farmers. Oftentimes, the companies provide all the training—you don’t have to already be an insurance agent to get started. Because of the field’s product diversity, you can specialize in many forms of insurance, including life, home, auto, small business, rental, and event insurance.

Best Financial Franchise Opportunities in 2022

First, choosing the best franchise is about finding the right one for you within the market you intend to operate. Will you be serving mostly business clients or consumer clients? Is your market already teeming with accountants and insurance providers or are there only a few options available locally? Do you want to invest in a storefront or would you rather focus on something like small business lending, where you may not need a storefront, the initial fees are relatively low, and you can leverage your existing business network for success?

Because every situation is different, consider the following questions when deciding which franchise is best.

  • Why are you interested in starting a franchise? Do you want to be hands on with the business? If so, ensure it’s a franchise that you find interesting. If this is this your first and only business, you may be able to commit more time to it than if it’s another business you’re adding to your portfolio.
  • How much liquid capital do you have? Most franchise opportunities disclose up front the capital you’ll need to invest.
  • What does your market look like — particularly in terms of competition? The best franchise is usually the one with the best chance to succeed within the market you intend to operate.

FAQs

How Do You Get Franchise Financing?

To get financing for a franchise, you need to ensure that you qualify for both the franchisee agreement and the needed financing for such a business. There are online platforms to help you determine what financing you are eligible for.

What Is the Most Profitable Franchise to Open?

Fast food franchises, like McDonalds and Dunkin’, are often the most profitable for franchisees. The UPS Store or Anytime Fitness franchises are also known for being profitable. The most important factor, however, should be your interest: think about your passions, and let that lead you to a franchise opportunity that works for you. If your passion is helping people grow or run a business, a Lendio franchise may be a good option. If you’d prefer to work with vacationers, consider hotels, t-shirt shops, or restaurants. Like kids? You may be interested in a childcare franchise or a children’s boutique. In addition to aligning with your own interests, your franchise will be more likely to turn a profit if it fits the physical location (note that some franchises, particularly in the financial services sector, may not require a physical location).

What Is the Cheapest Franchise to Invest In?

While many of the most popular franchises require a hefty amount of capital to open, there are dozens of franchise opportunities that require an investment of fewer than $15,000 to open. Some only require an initial fee of $10,000. For about the cost of a used car, you can open up a Jazzercise, Complete Wedding and Events, or Building Stars franchise, for example.

How to Get Started With Your Own Lendio Franchise

If you’re passionate about opening  a small business that helps other businesses in your community to grow, a Lendio franchise is exactly what you’re looking for. Available in 48 states, a Lendio franchise requires around $55,000–$65,000 in liquid capital to begin, but you don’t need to open a physical location. Leverage your phenomenal networking skills and local-business ecosystem knowledge into a fantastic franchise opportunity. 

Disclaimer: The information provided in this post does not, and is not intended to, constitute business, legal, tax, or accounting advice and is provided for general informational purposes only. Readers should contact their attorney, business advisor, or tax advisor to obtain advice on any particular matter.

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Barry Eitel

Barry Eitel has written about business and technology for eight years, including working as a staff writer for Intuit's Small Business Center and as the Business Editor for the Piedmont Post, a weekly newspaper covering the city of Piedmont, California.