How to Conduct a Successful RFP for a Financial Service Provider

  • By AFP Staff
  • Published: 2/6/2024

How to Conduct a Successful RFP for a Financial Service ProviderFind the right financial service provider for your organization.

A financial service provider (FSP) is a business that manages funds on behalf of customers. This entity plays a crucial role in money management and the facilitation of transactions in today's digital and interconnected world. FSPs include traditional banks, credit unions, consumer finance companies, credit card companies, e-money issuers and other payment institutions.

With so many options available, it's not always easy to figure out which FSP is the best fit for your organization. Plus, the decision to engage a specific FSP for one service or product can have ripple effects on how you manage your relationship with them, especially when considering the appointment of a new banking partner.

Whether an organization opts for a formal selection process depends on its procurement policy and the decision-maker's inclination to involve other departments and document responses from alternative providers. One common selection method is the request for proposal (RFP) process.

An RFP is a formal document outlining an organization's objectives, needs and service requirements. An RFP is employed to solicit bids from providers capable of fulfilling those requirements.

How to Write an RFP

An RFP should outline the organization's basic operating structure, lay out the RFP’s objectives, detail the information needed for the product/service, and define what the organization expects from the product/service — initially and throughout the life of the contract. It should also mention any administrative requirements. What the company wants should be clear to everyone inside the company and to potential responders.

You will need to determine three important pieces of information before drafting the RFP: business objective, business requirements and the project plan.

  • Objective: This means figuring out what is influencing the products or services you need. The reasons could be related to big-picture strategies or daily operations. Spelling out the goal and identifying the main factors lays the foundation for a higher-quality selection process.
  • Business requirements: Spell out what the organization hopes to accomplish, including the needs of the various stakeholders. You’ll start out with a list, which will need to be condensed into a formal definition of the organization’s requirements for the selection process. What is sometimes helpful in paring the list down is to rank the requirements as must-haves, nice-to-haves and neutral.
  • Project plan: This pinpoints the tasks for the project, sets deadlines, assigns resources and notes task dependencies. The plan should also list the people involved at each step and specify who will make the important decisions.

Finally, you need to decide on the form in which the RFP is delivered. The form determines how the RFP will be received by the potential FSPs and the way you’ll compare the responses. The simpler the RFP, the simpler the form can be. It can be as uninvolved as a structured response by email, or as complex as a workbook, PDF file, or RFP template hosted through a secured website.

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Five Steps of the RFP Process

Once the RFP document has been finalized, there are five steps to the process that follows:

1. Develop a List of Potential FSPs

The first step is for treasury managers to identify the potential FSPs for needed products/services using a request for information (RFI). The RFI helps create a list of potential service providers, excluding non-responders, who are willing and able to provide specific products and services. If the list is too long, additional criteria can help refine it.

Deciding on the length of potential providers is crucial; too many RFPs can slow the evaluation stage and give the impression that you’re seeking ideas rather than specific proposals. Depending on the project, sending RFPs to a few key providers may suffice. Regardless, it's advisable to inform potential providers of the upcoming RFP once the longlist is complete.

2. Issuance of the RFP

After issuing the RFP to the list of providers, your organization and the providers share a timeline. Your team should communicate the rules and timeline, preferably at a pre-bid meeting for all interested parties. Providers are likely to seek clarification; it's advised to direct all questions to a single point of contact. Sharing all questions and answers with the entire bidder pool is recommended.

3. Evaluation of Responses and Creation of a Shortlist

Now it’s time for the review team to outline the evaluation categories (basic RFP sections) and establish a scoring method. The scores help create a shortlist and identify strengths or weaknesses. Once the shortlist is decided, due diligence reviews, including financial capacity, stability and legal considerations, can be conducted.

4. Meetings and Demonstrations

In this step, you can ask detailed questions about the FSPs’ proposed treasury solutions and find out how they would handle the implementation. The implementation timeline can be very important to achieving the overall project goals.

5. Selection and Contract Negotiation

In the final step, the evaluation committee reviews the updated scores and chooses the preferred FSP. Depending on company protocols, senior management may need to review and ratify the choice. Once an FSP is selected, all contract details and service requirements should be finalized. The RFP process isn’t complete until the final contracts are negotiated and signed, which means it’s a good idea to hold off on notifying the other contenders until that time (if the contracting process is relatively short).

RFP Timeline

Going into the RFP process, you should have a timeline for how long each major step should take. Here is an example to help with your RFP process.

Element   Time Required
 Define objectives and develop project plan.    1 week
 Assemble project team.  2 weeks
 Develop business requirements.  2 weeks
 Obtain relevant transaction/use data.  4 weeks
 Develop account/system architecture.  2 weeks
 Perform vendor scan.  2 weeks
 Create vendor longlist.  1 week
 Determine RFP format.  1 week
 Develop RFP questions.  1 week
 Issue and administer RFP.  4-6 weeks
 Review and score proposals and pricing.  2 weeks
 Host vendor presentations.  1-2 weeks
 Select vendor.  1 week
 Implement project.  3-12 months

What Happens After the RFP Process

The stage after the RFP process is completed is the implementation and review stage and includes the following:

  • Implementation. In terms of time and effort, putting the plan into action is usually the most intensive part of the project. Just as the selection process required it, implementing the project necessitates good planning and sufficient resources. For larger projects, it might be smart to break it into parts. This way, you can test new practices and procedures in one area before they are rolled out company-wide. For instance, if you are implementing a global banking solution, consider starting with one region to sort out any issues.
  • Post-project review. The goal of the post-project review is to identify successful steps and procedures and explore the reasons behind their success. It serves as a learning opportunity for both the company and the selected FSP, providing valuable insights for managing the ongoing relationship.


You might ask, why use an RFP instead of an RFQ? A request for quotation (RFQ) is a formal document used by organizations to invite providers to bid on specific products or services. The difference between an RFP and an RFQ is that an RFQ works well for products and services that are largely standardized, allowing for easy comparison of quotes from different providers.

   Request for Quotation (RFQ)  Request for Proposal (RFP)
Purpose Solicit binding price quotes from vendors on comparable products and services Solicit proposed solutions and proposed pricing from selected vendors
Project Type Commoditized all purchases of all sizes Large-scale purchase of products or services
Format Detailed product/service specifications Detailed description of company and product/service needs
Expected Result  Price quote Vendors' recommended solution(s), capabilities and proposed pricing
Final Outcome Purchase order Contract negotiations and implementation

For large-scale contracts or purchases, many organizations mandate a formal RFP because it guarantees that they have identified the right providers and supplied them with the necessary information to propose products and services specific to the needs of the organization.

Adopting an ad hoc approach may result in a convoluted network of providers, leading to inefficiencies and avoidable costs. In contrast, when complemented by sound strategic planning and design, the RFP process becomes a potent tool for effectively acquiring treasury products and services.

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