Confirmation of Employment Letter for Bank

The letter of confirmation of employment for the bank is written by the employer of an organization for his employee who is seeking a loan from a bank. The employee presents this letter, issued by the employer, to the bank to ensure that he is currently employed and has a constant source of income.

As lenders, this confirmation of employment letter is often a requirement of different banks when they are lending money to employees. The banks seek this letter for various reasons, such as:

  • The bank needs proof of the borrower’s employment status and the income source.
  • If the employer is issuing a letter to its employee, it means that the employee probably will not suffer from any financial issues in the future when it comes to repayment of the bank’s money.
  • The bank wants to minimize the chances of default by ensuring the person is capable of repaying the loan and interest.

There are many templates available online and in programs, such as Microsoft Word, that can be used for writing this letter after customization based on the requirements of the employee, employer, and bank. Otherwise, the HR department can prepare the template itself. The information and the details included in this letter may vary but the general format includes the following:

  • Date.
  • Details of the employer.
  • Details of the employee.
  • Employment status and income figures of the employee.
  • Reinforcement of the employee’s character.
  • Reinforcement of the employee’s job security and the importance of his role in the organization.
  • Signature.

This letter holds great significance as it may be used by the bank, as a base, to decide whether the loan would be granted to a specific employee or not. Sometimes, if the bank is not satisfied with the details provided in this letter, it may simply reject the loan request even if the employee fulfills all the other criteria. This means that due attention needs to be given when this letter is prepared.

The letter, being an official document and evidence of the employee’s job and income status, is kept in his employee file with the employer as well in the borrower’s file, which is kept by the bank.

Sample Letter




To whom it may concern,

I am writing this letter to verify that Mr. John Douglas has been working in our organization as an ‘Assistant Sales Manager’ for one year. He has a contract of two more years which, most likely, would extend, as he is a high performer.

He is not only a good performer but a very honest and responsible employee as well. He never fails to deliver any assigned task efficiently and effectively. We consider him as our great asset based on his hard work and the importance of his position.

His net salary for a year is $90,000/- and his gross salary is $73,000/-.

Feel free to contact me if you have any questions at [TEXT].


James Mike,

HR Manager,
XYZ limited.

Confirmation of Employment Letter for Bank

File: Word (.docx) 2007+ and iPad
Size 26 KB