Consumer Banking of Standard Chartered Bank

PREFACE

On completion of requisite courses and a comprehensive examination of M.B.A of Chittagong University are required to undertake an internship program. In order to implement this program, each of them is attached with an organization. After the completion of internship program every student is required to prepare a report on a selected topic on the organization where he/she has been attached. The basic purpose of this attachment is to expose the student to the real Business world and acquaint himself/herself with the current operations & practices in modern Business. This exposure is very helpful in comprehending how things move on and to find the gap between theory and practical operation. This report also originates from that some perception about the practical situation as a fresh student. Actually this report comprises how a student has perceived the real situation in the business. As I am being attached with the Standard Chartered Bank, so I always tried of my best to observe how they deal with their Customer. I also studied about their working environment and how to process Credit and Collect outstanding. As a consequence, I have put theoretical glimpses of the key points wherever necessary and have tried to knit a relationship with this observation. Comments and suggestions for future development of the report or any concept will be appreciated.

EXECUTIVE SUMMARY

I here, who am a student of Accounting and Information System, have just appeared the MBA Examination. After completing my written examination and Viva, I started an internship program at Standard Chartered Bank. In attendance in this program, I have acquired practical knowledge. I have assembled an excellent and practical experience. Based of this program, I have prepared this report. Though there were several problems and limitations meanwhile the program I have tried to maintain level of best to make this report instructive and fledgling one Part 1:- Encompasses objective methodology and limitation the report Part 2:- Focus on An overview of SCB and Agrabad Branch. Part 3:- Focus on an overview of Credit & Collection of SCB. Part 4:- Focus on an overview of SCB Credit Card. Part 5:- Focus on the portfolio Part 6:- Focus on the other Bank. Part 7:- Various types of Packages and offered by SCB. Part 8:- I have elaborately discussed about my working experience in SCB and all of the things I have learned during my internship period. Part 9:- I focused on project part, which contains the analysis of the collection data. After analyzing the data I have identified the main problems faced by SCB and also provided some recommendations.

ACKNOWLEDGEMENT I have the immense pleasure and satisfaction in presenting report, which is termination of my project works at SCB. This is one pride to thank one and all who have helped me to take this project a great success. Most of my friends have heartily and cooperatively contributed to prepare this internship report. But scope and limitations prohibits the listing of all of them who have made significant contribution. I articulate my heartiest gratitude to my honorable supervisor Ranjit Kumar Chowdhury, Associate Professor, Department of Accounting and Information System, University of Chittagong for her significant advice and cooperative behavior.

The success of this report depend on the contribution of many people, especially those who spare time to share their mindful art of judging of merits and faults and have given valuable suggestions.
I would like to extend my thanks to the contributors of generous help from whom I have received much information about SCB. I am grateful to Syed Sanowarul Hoque, Credit Manager, Consumer Banking Division Chittagong and K.M. Bodroudoja, Collections Manager, Consumer Banking Division; Chittagong Who permitted us to perform our internship program and coordinated us sincerely. My gratitude also goes to Mr. Tanim Muntasir, Credit Analyst, Mr. Niaz Morshed, Officer, Collection And Mohammed Irfan Haidar Khan, Credit Analyst, Consumer Credit and Collections who have supplied necessary information and given valuable time to prepare my report. I offer my grateful thanks to Hasan Mohammad Iftekhar and Jahangir Iqbal, whose inspiration and kind assistance made my report successful. I could never forget the contribution of nor could express my gratitude fully to all that gave their heartiest effort in helping me. Thank you all.

Md. Kabir Uddin

LETTER OF TRANSMITAL

To The Associate Professor Department of Accounting & Information system University of Chittagong. Chittagong. Subject: Prayer to accept my internship report. Dear Sir, It gives me immense pleasure to submit the research report based on internship report entitled Consumer Banking of Standard Chartered Bank to fulfill the partial requirement of MBA program. I tried to make full use of this programmer through regular participation. I sincerely believe that the findings of this report will be of immense help to the academic and references and for any explanation and clarification of any aspect of this report. I would therefore pray and hope that your honor would be kind enough to accept my internship report and taking that limitation in account. I am thanking you. Sincerely Yours, ---------------------Md. Kabir Uddin Exam Roll: 82 (2001) Class Roll: 14507 M.B.A Department of Accounting &Information system University of Chittagong.

OBJECTIVE OF THE STUDY

The prime objective of this report is to learn practical knowledge along with our Institutional study; also I acquire knowledge and evaluate Credit and Collection Policies. The broad of this internship programmed is to get familiarity with Standard Chartered Bank and its marketing activities. To achieve this, the following objectives have been considered for the internship programmed. The main objectives of the study are as follow: 1. To focus on the product policy of the Bank under study. 2. To highlight on the CCU (Credit and Collection Unit) 3. To examine the Credit and collection system of the Bank. 4. To identify the problem of SCB. 5. To evaluate the promotional policy of SCB. 6. For identifying the prospect of the SCB. 7. To know the knowledge about Assessment of Various Statement.

8. To identify desire package of SCB Customer. 9. To identify the Credit and Collection problem and to suggest
remedial measures in order to help and solve those problems.

Origin of the report This time come of necessity to submit an internship report in partial fulfillment of MBA program. After the completion of final written examination of MBA, a student is supposed to have a weeklong internship program to be conducted in any business or service organization and submit a report on it. The report then evaluated by the judicious teaches & supervisor of the department of Accounting accordingly. Being guided by Ranjit Kumar Dey, Associate Professor Department of Accounting, C.U. The author conducted his internship on Consumer Banking of SCB. And produced this report as per requirement.

RESEARCH METHODOLOGY This report is prepared according to the practical experience achieved during the period of internee. All this materials are given below. The relevant information is collected from primary sources as well as secondary sources. PRIMARY DATA: 1. Group discussion with SCB Employee. 2. Primary information has been collected from the advertisement. 3. By meeting with responsible Officer. SECONDARY SOURCES: 1. Secondary information has been collected from articles; journal, paper and different textbook are also used when necessary. 2. SCB annual report. 3. Data from different official source and records.

4. Internet. RESEARCH PROBLEM

In my study I mainly depended on primary data which was collected through direct survey. I developed a questionnaire that consisted close ended questions and on open ended question. Data collection based is done on a random basis. The results are represented through bar charts. My research findings come out through analyzing those data. I also collected data and necessary information by interviewing employees of SCB which can be treated as secondary data. Another important dimension of the problem may arise from confidential Bank policy and lack of other internal and external sources. In view of above problems, I feel interest to know about it through SCB which would be a useful academic experience.

RATIONALITY OF THE STUDY Bank sector in the present environment has become subject to growing importance and interest with the emergence of giant industrial undertaking. In todays Bank is the prime mover of most social and market activities and delivery of standard of living to the society. This report is mainly focused on that. Bank is one of the most suitable sectors for Bangladesh having a good demand and market growth rate. Banking is the part of MBA program. The research is one of the important parts of the course. The purpose of the study is to assist the report writer to find out the Banking activities and also the opinion of the Customer about the existing system of SCB and other Bank. In the present world a progressive firm always looks forward to make the best utilization and allocation of their resources and make the best use of the scopes and opportunities in order to maintain their position in this competitive market, SCB is no exception to it. The research communicates with the consumer, customer and public to the marketer through information. In this report I have tried to present about different pertinent parties can be benefited researcher involved with Bank can get an over view to find out potential competitive advantages, It will be also helpful for the policy maker of the Bank to make quick decisions. The marketing professional can consume less time to express their valuable opinion by going through this report. Coming entrepreneur of Banking Sector will be benefited by this report by analyzing the findings of this report and evaluating potential threats and opportunities, its market position and facilities to customer and other Banking activities. This report will help to know how SCB maintains their Credit and Collection system by managing competition with different Banks. Although the study may be useful for the Banking sector in formulating different policies on Credit and Collection and thereby in future decision making. The potential entrepreneur, professional, the students of business and young learners will be benefited and search their knowledge in this report. These are all the rational of the study.

LIMITATION OF THE REPORT Time Constraints: In preparing the report time was the principal constraint. As my internship program was only for three months it was difficult for me to figure out the report with absolute information and required data. For the report and proper presentation after internship program in needs much time for preparation. Data Constraints: Last few decades our banking system developed much with its resources and collaborations. But comparison to Western countries we have the different of few more decades realized (by me) when I attempted to collect essential required data. These are still scarce in our country. Whether it is primary or secondary data. With the best available data this report is illustrated. Experience constraints: To prepare and produce such kind of report properly it is needed previous experiences. In the faculty we have produced some reports but not as great as it is. In preparations of the internship report I also used my previous faculty experience although it is needed much more. I think experienced could have differed a great deal. Organization constraints: As a financial organization SCB has a great deal of hidden information that is not possible to present in the report. As organizations permanent employee one can know it but not so this is also one of the limitation of my report.

About the Report In this report I have tried to expose a total picture of my activities in SCB. This report is basically divided into three parts and these are: Part A Part B Part C Part D The first part contains an observation of my work. This is the part where I have tried to present an overview of the total SCB. I have worked on with an introduction to the study. The second part contains Credit, Credit Cards and Project of SCB, in the third part I have drawn on Collection criteria and last part Conclusion. The first part, which would be, mentioned as an observation part, the second part which has been named as Consumer CREDIT and statistical analysis part, the third one has mentioned as Collection and last, the conclusion and recommendation part.

INTRODUCTION Overview

Standard Chartered leading the way in Asia, Africa and the Middle East Standard Chartered employs 30,000 people in over 500 locations in more than 50 countries in the Asia Pacific Region, South Asia, the Middle East, Africa, The United Kingdom and the Americas. It is one of the world's most international banks, with a management team comprising 70 nationalities. Standard Chartered is listed on both the London Stock Exchange and the Stock Exchange of Hong Kong and is in the top 25 FTSE100 companies, by market capitalization.
It serves both Consumer and Wholesale Banking customers. Consumer Banking provides credit cards, personal loans, mortgages, deposit taking and wealth management services to individuals and small to medium sized enterprises. Wholesale Banking provides corporate and institutional clients with services in trade finance, cash management, lending, custody, foreign exchange, debt capital markets and corporate finance. Standard Chartered is well-established in growth markets and aims to be the right partner for its customers. The Bank combines deep local knowledge with global capability.

The Bank is trusted across its network for its standard of governance and its commitment to making a difference in the communities in which it operates. Our History:-A brief history of Standard Chartered Standard Chartered is the world's leading emerging markets bank headquartered in London. Its businesses however, have always been overwhelmingly international. This is summary of the main events in the history of Standard Chartered and some of the organizations with which it merged.
Launch the interactive timeline to learn about remarkable people, events and discoveries that have shaped the world we live in, through out the history of Standard Chartered.

The early years

Standard Chartered is named after two banks which merged in 1969. They were originally known as the Standard Bank of British South Africa and the Chartered Bank of India, Australia and China. Of the two banks, the Chartered Bank is the older having been founded in 1853 following the grant of a Royal Charter from Queen Victoria. The moving force behind the Chartered Bank was a Scot, James Wilson, who made his fortune in London making hats. James Wilson went on to start The Economist, still one of the world's preeminent publications. Nine years later, in 1862, the Standard Bank was founded by a group of businessmen led by another Scot, John Paterson, who had immigrated to the Cape Province in South Africa and had become a successful merchant. Both banks were keen to capitalize on the huge expansion of trade between Europe, Asia and Africa and to reap the handsome profits to be made from financing that trade. The Chartered Bank opened its first branches in 1858 in Calcutta and Mumbai. A branch opened in Shanghai that summer beginning Standard Chartered unbroken presence in China. The following year the Chartered Bank opened a branch in Hong Kong and an agency was opened in Singapore. In 1861 the Singapore agency was upgraded to a branch which helped provide finance for the rapidly developing rubber and tin industries in Malaysia. In 1862 the Chartered Bank was authorized to issue bank notes in Hong Kong. Subsequently it was also authorized to issue bank notes in Singapore, a privilege it continued to exercise up until the end of the 19th Century. Over the following decades both the Standard Bank and the Chartered Bank printed bank notes in a variety of countries including China, South Africa, Zimbabwe, Malaysia and even during the siege of Marketing in South Africa. Today Standard Chartered is still one of the three banks which print Hong Kong's bank notes.

Expansion in Africa and Asia

The Standard Bank opened for business in Port Elizabeth, South Africa, in 1863. It pursued a policy of expansion and soon amalgamated with several other banks including the Commercial Bank of Port Elizabeth, the Colesberg Bank, the British Kaffarian Bank and the Fauresmith Bank. The Standard Bank was prominent in the financing and development of the diamond fields of Kimberly in 1867 and later extended its network further north to the new town of Johannesburg when gold was discovered there in 1885. Over time, half the output of the second largest goldfield in the world passed through the Standard Bank on its way to London. In 1892 the Standard Bank opened for business in Zimbabwe, and expanded into Mozambique in 1894, Botswana in 1897, Malawi in 1901, Zambia in 1906, Kenya, Zanzibar and the Democratic Republic of Congo (D.R.C.), in 1911 and Uganda in 1912. Of these new businesses, Botswana, Zanzibar and the D.R.C. proved the most difficult and the branches soon closed. A branch in Botswana opened again in 1934 but lasted for only a year and it was not until 1950 that the Bank re-opened for business in Botswana. In Asia the Chartered Bank expanded opening offices in, Myanmar in 1862, what is now Pakistan and Indonesia in 1863, the Philippines in 1872, Malaysia in 1875, Japan in 1880 and Thailand in 1894. Some 34 years after the Chartered Bank appointed an agent in Sri Lanka it opened a branch in 1892 to take advantage of business from the tea and rubber industries. During 1904 a branch opened in Vietnam. Both the Chartered and the Standard Bank opened offices in New York and Hamburg in the early 1900s. The Chartered Bank gaining the first branch license to be issued to a foreign bank in New York. The impact of war Even the First World War offered opportunities for expansion when the Standard Bank set up a branch in Tanzania shortly after British troops occupied the formerly German administered Dar es Salaam in September 1916. Both banks survived the inter-war years but the world trade slump led to the closure of operations in the Canary Islands, Liberia, the Netherlands, and Equatorial Guinea. Disaster struck the Chartered Bank's office in Yokohama, Japan, when it was destroyed by an earthquake in

1923 killing a number of staff. The Chartered Bank was particularly affected by the Second World War when numerous Asian countries were occupied by Japan.

The post war years After the Second World War many countries in Asia and Africa gained their independence. This led to local incorporation in some countries, particularly in Africa. Other operations such as those in Iraq, Angola, Myanmar and Libya were nationalized, while in Indonesia the Jakarta office was destroyed in an attempted coup d'etat. In 1948 the Chartered Bank opened in Bangladesh and during 1957 it acquired the Eastern Bank. The Eastern Bank gave the Chartered Bank a network of branches including Aden, Bahrain, Beirut, Cyprus, Lebanon, Qatar and the United Arab Emirates. The Chartered Bank also entered into a joint venture to form the Irano-British Bank which opened for business in 1959. The bank grew rapidly and had 24 branches when it was nationalized in 1981. By the mid 1950s the Standard Bank had around 600 offices in Southern, Central and Eastern Africa. Its network grew substantially in 1965 when it merged with the former Bank of British West Africa which had some 60 branches in Nigeria, 40 branches in Ghana and eleven branches in Sierra Leone in addition to operations in Cameroon and Gambia. Despite these acquisitions and expansion into new countries such as Mexico, South Korea and Oman (1968), both the Standard and Chartered Bank networks were comparatively small. Both viewed the future with some trepidation as the need to protect them from acquisition became ever more apparent. Standard Chartered PLC In 1969 the decision was made by the Standard Bank and the Chartered Bank to undergo a friendly merger thus forming Standard Chartered PLC. It was one year later that the descendants of the "Chartered Bank of India, Australia and China" were finally permitted to open a representative office in Sydney, Australia. Standard Chartered subsequently acquired the UK based Hodge Group, in which it already had a minority shareholding, and the Wallace Brothers Group. The Hodge Group brought to Standard Chartered an extensive network of UK offices

specializing in installment credit and industrial leasing, and after a period of rationalization its name was changed to Chartered Trust Limited. Standard Chartered operations in Jersey emerged from the integration of other Hodge Group businesses with those of Wallace Brothers Bank (Jersey), Limited. Standard Chartered decided, after the merger, to expand the Group outside its traditional markets. In Europe a number of offices were opened including Austria, Belgium, Denmark, and Ireland, Spain and Sweden as well as several major cities in the UK. Standard Chartered also opened offices in Argentina, Canada, Colombia, the Falkland Islands, Panama and Nepal. In the USA a number of offices were opened and three banks were acquired. These included the Union Bank of California which gave Standard Chartered a presence in Brazil and Venezuela. The opening of a branch in Istanbul in 1986 was overshadowed by a far more dramatic event when Lloyds Bank of the UK made a hostile take-over bid for Standard Chartered. Standard Chartered won its right to remain independent but entered into a period of considerable change. By the late 1980s Standard Chartered already had considerable exposure to third world debt. To this were added provisions against loans to corporations and entrepreneurs who could not meet their commitments. Standard Chartered reviewed its operations and decided to focus on its core strengths of Consumer Banking, Corporate & Institutional Banking and Treasury in its well established operations in Asia, Africa and the Middle East. This led to a series of divestments notably in Europe, the United States and Africa. During this time staff numbers were reduced; businesses not considered core were sold or closed; associate holdings disposed of; unprofitable branches closed and back office functions consolidated. In addition expensive buildings were sold with the proceeds reinvested in the business, and the senior management team was radically changed and strengthened. Standard Chartered in the 1990s Even within this period of apparent retrenchment Standard Chartered expanded its network, re-opening in Vietnam in 1990, Cambodia and Iran

in 1992, Tanzania in 1993 and Myanmar in 1995. With the opening of branches in Macau and Taiwan in 1983 and 1985 plus a representative office in Laos (1996), Standard Chartered now has an office in every country in the Asia Pacific Region with the exception of North Korea. In 1998 Standard Chartered concluded the purchase of a controlling interest in Banco Exterior de Los Andes (Extebandes), an Andean Region bank involved primarily in trade finance. With this purchase Standard Chartered now offers full banking services in Colombia, Peru and Venezuela. In 1999, Standard Chartered acquired the global trade finance business of Union Bank of Switzerland. This acquisition makes Standard Chartered one of the leading clearers of dollar payments in the USA. Standard Chartered also opened a new subsidiary, Standard Chartered Nigeria Limited in Lagos, acquired 75 per cent of the equity of Nakornthon Bank, Thailand; and agreed terms to acquire 89 per cent of the share capital of Metropolitan Bank of the Lebanon. Standard Chartered todays Today Standard Chartered is the world's leading emerging markets bank employing 30,000 people in over 500 offices in more than 50 countries primarily in countries in the Asia Pacific Region, South Asia, the Middle East, Africa and the Americas. The new millennium has brought with it two of the largest acquisitions in the history of the bank with the purchase of Grindlays Bank from the ANZ Group and the acquisition of the Chase Consumer Banking operations in Hong Kong in 2000. These acquisitions demonstrate Standard Chartered firm committed to the emerging markets, where we have a strong and established presence and where we see our future growth.

STANDARD CHARTERED BANK IN BANGLASESH Standard Chartered Bank started its operation in Bangladesh back in 1948. Standard Chartered Bank network facilitates fast and convenient connection for foreign trade, bonding and remittance business as well as market ad business intelligence. Besides, the Bank is serving a large number of local corporate and Government organizations. Acquisition of ANZ Grindlays Bank by Standard Chartered Bank was completed on 31st July 2000. The transaction represents a major for both the sides. In Bangladesh Standard Chartered Bank is operating 17 offices in 6(six) divisional cities and towns including Dhaka, Chittagong, Khulna, Sylhet, Bogra, and Narayangong. The standard Chartered Banking activities around the country within the divisional cities and towns can be traced from the following table: Divisional Cities & Points of representation Towns Dhaka Dilkhusa, Banani, Chittagong Khulna Sylhet Motijhel, Kawrna No. of Branches/Cas h office (s) Dhanmondi, 10 Kakrail,

Bazar,

Gulshan, Hotel Sheraton, Uttara Agrabad C/A, Nasirabad, Station 3 Road Khulna Sylhet 1 1

More over, the Bank is now operating its ATM (Automatic Teller Machine) service from 23 individual locations in Dhaka, Chittagong, Khulna, Sylhet, Bogra, and Narayangong.

STANDARD CHARTERED BANK (CHITTAGONG MAIN) IN CHITTAGONG AN OVERVIEW LOCATION: Standard Chartered (Ctg. Main) is located at Agrabad, the commercial location of Chittagong. The area Agrabad has grown over the years to a prime commercial location with the development of the port and the tr5ade based business. CUSTOMERS: The customers of Standard Chartered Chittagong main comprises mainly of professionals, service holders, businessmen who are involved in trading, manufacturing and service oriented entrepreneurs and limited extent of housewives. Besides, these customers, it also caters to the needs of people who are operating different company accounts. The average age of the customers of Standard Chartered Chittagong main ranges from 30 to 45 years. Among the professionals maintaining accounts in this branch, 45% are service holders where as the rest i.e. 55% are businessmen. More than 60% of the businessmen are involved in trading or other related business. Among the service holders a significant portion are working in different corporate organization. However, it is observable that the account holders are not usually present at the Bank for Cash Transaction. LOCATION CONDITION: The economic condition of the area is developing rapidly. Because of the possibility of gas and oil exploration, the influxes of people from different overseas countries are increasing day by day. Awareness among the people foreign Banks is increasing gradually and people are becoming more confident in dealing with reputed foreign Banks. These changes and improvements of the overall economic and social condition have significantly changed the mindset of the general

people, which will ultimately help to improve the entire scenario in case of foreign Banks. PART B: Account Opening A/c Opening To open an account the party has to duly fill up A/c opening form, S.S. card and then has to submit the necessary particulars according to account nature. All kinds of account require two photograph of party except three stages savings scheme. One form is used to open all kinds of savings accounts. Another form is used for limited Company, Autonomous Corporation and societies club etc. Yet another for current account for individual joint or proprietorship the opening form of partnership is a bite different. Three types of accounts such as: -For SB account -For CD account -For term Deposit. Name of Accounts are Savings account Extra Value Savings Scheme Current deposit account STD (Short Term Deposit Account) Limited Company, Autonomous Corporation account Three stage savings scheme Marriage savings Scheme Millionaire Savings Scheme Children Education Scheme Rainy Day Savings Scheme

For Different type of account the following papers are required: Savings Account: 1. 2. Duly filled up account opening form with introduction from an existing account Nominee with photo. 3. Party has to submit two copy passport size photographs. in case of a minor. Partnership Account: 1. Partnership deed is needed which is attested by notary public. holder.

2. Who will operate the account must be written in the partnership deed. 3. 4. A notarys certificate of partnership deed is also required. Each page of partnership deed is to be attested by notary public. 5. In case of decease of any partner, his family member or a nominated person can operate the account if there is any instruction if the account. 6. Individually every partner has to sign in the partnership letter formatted by the bank. Current Account 1. 2. 3. Collecting current deposit a/c opening form from the bank counter.] Filling up the form with required information. Enclosing photographs attested by introducer. 4. Full signature and specimen signature in the application form as well as in the SS (specimen signature) card. 5. Minimum required cash deposited to the cash counter. 6. Checking of the required information and introducer a/c no. by the authorized officer. Limited Company/ Semi Govt. Autonomous Corp. A/C True certified copy of memorandum and articles of association. Board resolution True certified copy of certificate of incorporation. Attested Signature by the board of directors. In case of public limited company certificate of commencement is required.

Proprietorship Accounts The common procedure of current deposit account opening is followed. In addition one needs to enclose:Photocopy of trade license given by the City

corporation/Pourashava. - Sign and seal of proprietor in the application form as well as in the SS (Specimen Signature) card to be given properly.

STD A/C - The A/C opening procedure is same as C/D A/C opening. - 5.5% interest is given against this deposit A/C - Minimum 7 days notice is needed in earlier cases but, it has now become a practice to withdraw money by the clients with immediate prior written notice or Telephone contact. Cheque Book Issuance: The chequebook is a security stationary used for transactions by the account holders. Chequebook is issued through a requisition form/slip which acts as an application from the respective A/C holder. The requisition slip comes into action at two stages (a) At the time of account opening. (b) For new chequebook when the slip is located nearly at the end of the old one (e.g.-three leaves before the end of the 10leaf chequebook). The requisition form contains (a) The date of issuing. (b) The serial number of the leaves (c) Signature of the applicant. Procedure (1) Authorized officer verifies the applicants signature. (2) A/C no is mentioned on each leaf of the new chequebook. (3) Two officers initials are put on every leaf, usually one beside the A/C. no and the other beside the cheque series no.

(4) A register is maintained for this purpose, where the- A/C holders name - A/C no. - Serial no. Of cheque leaves are written. The A/C holder signs the register before the new chequebook is issued to his name. Both S/B and C/D A/C cheque books are issued through this procedure though the particulars are recorded on different registers. Again S/B A/C usually needs ten or twenty-five leaf cheque books while due to its frequent nature of transaction, C/D A/C usually requires more leavesfifty or hundred leaf cheque books. Issuing duplicate cheque book Due to various reasons, a cheque book may be damaged or missing, which rouses the need for a duplicate cheque book. Procedure (1) The A/C holder submits a written application for a duplicate chequebook. (2) Inquiry is made whether any unused leaf of the

chequebook was signed. (3) Payment is stopped on the missing serials of the chequebook after the serials of the missing leaves are matched on the register. (4) With the permission of the In-charge, a duplicate

chequebook is issued whose serial numbers are not the same as that of the previous one. I.B.C. & O.B.C. I

Inward & Outward Transfer Delivery Transfer delivery takes place when the cheque of one branch of the SCB is presented to another branch for collection. Receiving the cheque, branch authority sends it for collection to the payee branch, without sending it to principal office. If they honor the cheque of the respective branch, the payee branch issues an IBCA in favor of the collecting branch. Responding the IBCA the collecting branch debits the payee branch and credits the parties account. This is the procedure for outward transfer delivery. If the other branch collects the cheque of our branch, then it is called inward transfer delivery. Collecting branch send the cheque to us. Verifying the signature, branch authority examines whether there is sufficient money available or not in the account. If the cheque is honored the branch authority issues an IBCA debiting the party account in favor of the collecting branch. A credit voucher is prepared against. Which the IBCA is issued as under: Party A/C Dr. Gen. A/c Collecting Branch Cr. Out ward Bills for Collecting (OBC) Besides clearing house and transfer delivery, we have to send cheques to other district for collection. Basically OBC is required when the cheque is not of a same clearinghouse. Steps required for collecting outward bills are as follows: 1) Register entry of the cheque.

2) Stamping OBC seal on the face of the cheque and writing the OBC No. As such given in the OBC register and endorsing (Payees account will be credited after realization) the cheque with the signature, of authorized officer. 3) Writing two copies of OBC forwarding letter, of which one copy will be Sent to the collecting branch along with the cheque and another will beI kept in the OBC outstanding file. The contra voucher for OBC collection is as such: Outward Bills lodged Dr. Outward bills for collection Cr. After collecting the amount of cheque the originating branch will send an IBCA. Responding the IBCA, collecting branch debits the originating branch and credits the party account through the pay-in-slip that is kept with the forwarding letter of OBC. If the cheque is drawn on a bank other than ours, a D.D is sent in U response to the OBC with the commission & postage charge of the D.D deducted from the amount of the cheque. The D.D is issued in favor of our branch, therefore the endorsement Received Payment is put on the reverse of the D.D before sending it for collection through clearing. The amount is credited to partys NC though party credit voucher. Reverse contra voucher is prepared for positing. Outward bills for collection A/C Outward Bills lodge Cr. Dr.

Besides this, commission and postage will be charged to the party for collection of the cheque. Accounting procedure will be as such: Party A/C Dr. I /A Comm. on OBC Cr. I/Postage on OBC Cr.

After posting commission and postage charge in the register along with the IBCA No. a signature of the authorized office is taken and after signing the vouchers by the officers these are posted in computer. Inward Bills for Collection (IBC) .The branch through dispatch receives instrument with a forwarding letter. 2. Entry is passed to the register of I.B.C. 3. A simple credit voucher is prepared under the title: SCB Gen. NC Respective Branch (O.B.C. issuing branch) with the following date in that voucher O.B.C no. With the corresponding O.B.C no is recorded. 4. In the reverse side of the instrument Our Branch endorsement confirmed endorsement with the authorized officers signature is given. 5. The instrument is then sent for collection through the clearinghouse according to the procedure. 6. After collection of amount/proceeds an I.B.C.A. is prepared favoring the instrument-sending branch.

In this way the proceeds of honored O.B.C is sent to the O.B.C issuing branch. The following are subsidiary works, done at the OBC desk ACCOUNT TRANSFER: Account transfer implies the transfer of account of a party from one branch to another of the same bank. Steps of account transfer are as follows - At first, the party submits an application to the branch manager for transferring his account. - In the application, party mentions the branch name to which party intends to transfer his/her account. - Party surrenders his/her chequebook with unused cheque leaves. - Then cheque series no are checked with the record. - Authorized officer verifies the party signature on application. - Unused cheque leaves are destroyed in front of the party. - An inquiry is made in every department of the branch whether the party is maintaining a loan account or not. - If everything is all right, balance position of the account is taken from the computer. - Bank debits party account to make the balance nit. Then the following vouchers are prepared: Party A/C. Dr. Income A/C transfer charge Cr.

SCB General A/C. (New branch) Cr.

An IBCA is prepared and sent to the new branch with a

forwarding letter. Account opening form and S.S. card are marked

Transferred from X Branch to Y branch. - Transferring branch keeps application, balance statement, photocopy of account opening form and S.S. Card. - A/C opening form, S.S. card and balance statements are sent to new branch. - Party account is marked Transferred in the account opening register. - No. of A/C is deducted by one in the account opening register. - A transferring note has to be taken in the A/C opening register. FUND TRANSFER Fund transfer implies transfer of fund from one account to another in the same branch. It is a simple process. Bank just debits the account, which would be transferred and credits the account that would get the deposit. Two vouchers are prepared in this regard. Party (Drawer) account. Party (Payee) Cr. Dr.

CLOSING OF DIFFERENT TYPES OF ACCOUNTS: SB A/C Step of SB A/C, closing are as follows:

- At first, the party will submit an application to the branch manager for closing his/her account. - Party will surrender his chequebook with unused cheque leaves. - Cheque leaf serial no. will be checked with the record. - Authorized officer will verify the partys signature on application. - Unused cheque leaves are to destroy in front of party. - An inquiry is to be made in every department of the branch whether the party is maintaining a loan account or not. If every thing is all right, balance position of the account has to be taken from the computer. Bank will debit party account to make the balance nil. Then the following vouchers are to be prepared Party A/C. Dr. Income A/C charges on account closing Cr. Bills payable pay slips issued. Cr. Two authorized officer will approve voucher. S.S. card and account opening form will be marked Closed.Party account is to be marked Closed in the account opening register.No. of account will be deducted by one in the account opening register. A closing note has to be taken in the account opening register. CD/AC Same as savings A/C except charging the interest. Closing of schemes

Different schemes are at work or were maintained in the branch such as Three Stage Saving Scheme, SCB Savings Scheme etc. Clients may choose to close this A/C before or after maturity. Party submits application along with his/her pay-in-slip book. CESS A/C closing: Before maturity There are three terms of maturity for C.S.S A/Cs 4 years, 7 years and 10 years. No interest in given if a C.E.S.S A/C is closed before 6 months. If anyone chooses to close the A/C after 6 month but before 4 years, the accounting procedure is as follows: 1. Balance up to previous month +( Interest Provision for the month (Adj. A/C Balance up to the date=================== -( Amount of installation given by party each month Interest @ 11 % [the closing is premature, interest will be given at Savings rate instead of C.E.S.S rate of 11%] The vouchers a) Adjusting A/C: Interest. Payable on C.S.S (provision for current
month) -Dr.

C.S.S. A/C Cr. b) C.S.S A/C Dr.

Expenditure A/C: Interest. Paid on C.S.S (excess interest) Cr. Income A/C: closing charge Cr.

Other liabilities: 10% Source tax Cr. Bills payable: Pay slip issued cr. Deceased A/C. While working at the desk I had an opportunity to see the closing of a deceased account. - One nominee on behalf of all nominees and successors submit an application to the bank mentioning the death of his/her relative. - All kinds of transactions are made stopped by the bank then. The Bank follows the following procedures to make payment - Submission of an application reporting the death of A/C holder by the nominee on behalf of all nominees and successors to with draw the balance amount maintained with the Bank. - The authorized nominee then has to submit the following documents. - Death certificate of the account holder - Gorosthan Certificate. - One copy of successor certificate given by the district Judge, mentioning the proportionate amount to be distributed to each of the successors & nominees of deceased A/C holder from various accounts of various Banks. (I.e. various Bank balance). Word commissioner identification certificate with

photographs. Then the Bank collects balance conformation sheet from the computer department internally duly signed by authorized

Officer of the branch. Account opening form with SS card collected by the authorized officer internally. After conformation a forwarding letter is sent to the H.O. (Law dept.) mentioning the deceased account holders particulars to make arrangement of payment of the account. The H.O. (CAD) sends an approval letter after judgment of the documents with the forwarding. At the time of final settlement of disbursement of the fund of the A/C after receiving the confirmation letter from H.O. one indemnity bond on a non-judicial stamp (150/-) is signed by the authorized nominee and by other nominees and successors. After the payment of the proceeds Deceased A/C closed is marked both on the A/C opening form and on the S. S. card.

CLEARING Clearing activities are of two types: (I) (ii) outward clearing. Inward clearing.

Outward clearing Cheques, DD, Pay order SDR Treasury Challan etc. Instruments are deposited by various customers of different A/C Of Principal Office (P.O.) for collection through writing in

the

pay-slips

and

credit

vouchers

in

case

of

IBC.

Or

instruments received from Head Office (H.O.) and F. Exchange Dept. of P.O. As to provide customer service Bank acts as an intermediary to collect proceeds of instruments through the Bangladesh Bank clearing house. It is to be mentioned here that collected instruments are of other than the SCB. When the cheque or other instruments come for collection, the clearing officer receive the instruments from the customer by giving Received seal and initials On the foil of the pay-inSlips. Immediate after receiving the instruments special crossing/recipient Branch. Crossing is given on the instrument. Clearing seal with the next date is given on both the instruments and pay-in-slips. Proper endorsement and the authorized officers signature are given on the back side of the instruments. The clearing officer then keeps the instruments in his custody. Except these different instruments received the P.O. from HO, IBC of P.O. sent by various branches of the SCB for collection through their OBC which are out side the clearing zone, and different instruments sent by other branches received by them from their own customers for collection inside the clearing zone are also collected by P.O. through clearing house. Cheque and other instruments detailed information are recorded in the outward clearing register (date validation sheet _ house). Statements of Bank wise delivery details and Branch wise delivery details/cheque totals are prepared. In the first house of the next day, Principal Office sends the instruments to the issuing branch./originating branch. Of various Banks for collection through the clearing house.

Inward clearing Under this mechanism Principal Office collects the cheque and instruments issued by different branches and P.O. of the SCB for collection. One representative officer of the SCB collects the instruments from other Banks through clearing house. Our inward clearing instruments are the outward clearing instruments of other Banks. The instrument are then sorted out and sent to the respective issuing branches after proper recording to the register. After receiving the inward clearing instruments, the

instruments issuing branch/originating branch makes entry in the inward clearing register. The authorized officer of the branch then examines the instruments. The officer then checks the balance of respective NC in the computer whether sufficient balance available or not to honor the instrument. After the instruments have been passed, an IBCA is prepared fig. P.O. for the total honored fig. The dishonored instruments are returned to the P.O. with return memo. Accounting procedure of different Branch is as under (For honored instrument) 1. Party Dr.

(Instrument it self) 2. SCB General NC: P.O Cr.

Accounting procedure of P.O. as under 1. Respective Branch. A/C Dr.

(Responded IBCA sent by different (Branch for honored fig.) 2. SCB General NC: HO Cr.

(For honored fig of instruments Of P.O. & other branch) For total honored fig. of instruments of P.O. and other branches inside the clearing zone an IBCA is prepared for. H.O. and sent to H.O.The dishonored instruments of P.O. and other Branches are sent to second clearinghouse of B.B with Bank wise delivery cheque totals to return the instruments to the respective collecting banks for final settlement of transactions among the various Banks for that day. The dishonored fig. is also recorded in the inward clearing reg. of P.O. In this way clearing function occurred. Endorsement for clearing. While receiving any kind of cheques or instruments, which will be deposited in the customers A/C, SPL crossing is given by the Branch. Then the following endorsement is usually put on the reverse side of the instruments. 1. Received payment for the SCB - When there is no payees name in the cheque but only instruction that pays to self, cash, you, or SCB P.O., The SCB, then this is the appropriate endorsement. 2. Payees A/C credited for the SCB - When the name of the payee is given on the cheque and the drawee Bank is in that clearing house then this is the appropriate endorsement. 3. Payees A/C will be credited on realization for the SCB

- When the drawee Bank is not in that clearing House, This endorsement is given by the OBC sending Branch. In Case of IBC of this branch for collection. 4. Our branch endorsement confirmed for the SCB - The collecting branch gives when an instrument is received as IBC sent by other branch of the Bank for Collection then this endorsement. in side clearing house. DEPARTMENT: SANCHAYAPATRA: Sanchaya Patra is the instrument against which both

institutional and non institutional customers/people make investment of their idle money. It is a mode of investment against which the customers in terms of Bank or/and the people who have no legal relationship with the Bank as customer make risk free investment though the instruments (S.P). It is the system of collecting idle money from people/institutions whose money will be considered to be of no use for a minimum period time (i.e. 1 year or above). The Jatiya Sanchaya Bureau is the only authorized organization of the Bangladesh Govt. to print out the instrument and arrange to collect the sales proceeds of S.P for deposit mobilization from the public. Bangladesh Bank is the only authorized dealer to arrange the mechanism/collect the sales proceeds of S.P. disbursement of Interest payable to the S.P. purchaser thereof. Since all NCBs, Automous and private Banks are the agents of B.B. to provide public service, So NCBs, Autonomous and private Bank and some govt. organizations (selected) performs the activities of selling S.P. and payment of interest. thereof to the S.P. purchaser as per

the instructions of Bangladesh Bank (B.B). Against these services NCB5,. Autonomous and private Banks receive commission through B.B. from Jatiya Sanchaya Bureau. Jatiya Sanchaya Bureau utilizes the collected proceeds in the best possible way that keeps risk at the lowest level and earns more profit agt. which Interest is paid to the customer of S.P. The process of selling S.P. & payment of Interest thereof are out of General Banking activities, but a specific section under General Banking Department does these activities. Issuing Procedure 1. Duly filled up application form submitted by the customers (the form provided by the Bank). 2. Customers may make payment to purchase SP in the following ways (i) In cash (ii) By cheque through clearing or transfer. (iii) Via other branch. Of the same bank. Preparation of Vouchers for the above payment procedure: (i) If a customer makes payment in cash A customer makes payment in cash through cash counter. Cash dept. gives Cash received seal on the credit voucher. Cash (if self) Dr. Sundry deposit A/C. S.P issued Cr. (ii) a. If a customers make payment by cheque of the same branch

The submitted cheque is considered as debit voucher by duly passing it by the Authorized officer of the branch. Party A/C (Cheque if self) Dr. Sundry deposit A/C S.P. issued Cr.

(ii) b. If a customer makes payment by cheque of the other bank - Received cheque is deposited to the customers A/C in the branch with the pay-in-slip. - Proceeds are collected through clearing house /O.B.C mechanism. - The customer then draws a cheque on his/her A/C agt. S.P. purchase purpose. - This cheque is then considered as debit voucher by duly passing it by the authorized Officer of the Branch. (iii) If a customer maintains an A/C with other branch, of the same bank and intends to purchase S.P by that branch - The customer can make payment in cash or issues a cheque on his/her A/C maintaining with that branch. - After passing if by the A. Officers of that branch. An IBCA is prepared And sent to the S.P. issuing branch. (P.O.) The application form (filled up) of the customer after

verification of his/her sign thereby an A. Officer, with a forwarding letter mentioning A/C holders same, A/C No. S.P. Name & value therein sent to the S.P. issuing branch. With the IBCA.

S.P. issuing branch. Then responds the IBCA, which in turn becomes a debit voucher then. Dr. Sundry Deposit A/C S. P. issued Cr. SCB Gen. A/C. (respective branch. IBCA issuing branch.)

3. Then entry is passed to the S.P. issuing Register. 4. Instruments are prepared and issued to the customer. 5. A.S.P. Sales statement with a forwarding letter sent to B.B. within 72 hours of sales, stating therein to collect the proceeds from S.P. Selling Bank, from the A/C of the Bank (HO) maintained with B.B. One photocopy of the statement with a forwarding Letter is sent to the CAD of HO of S.P. issuing Branch. 7. Agt. this statement, B.B. sends a debit advice to S.P. issuing branch. After collection of proceeds from the A/C of H. 0. > S.P. issuing branch. Then makes reconciliation with the

advice and S.P. selling statement & forwarding letter. > After confirmed Ok, one photocopy of debit advice B.B. is sent to CAD of HO.CAD of HO then prepares and sends an IBDA to S.P. issuing branch. for the proceeds to collect on behalf of B.B. Voucher preparation by HO 1. 2. SCB Gen A/c S.P. issuing branch Dr. Bangladesh Bank Cr.

After receiving IBDA, S.P. issuing Branch. Makes the following treatment. 1. 2. Sundry deposit A/C S.P. issued Dr. SCB Gen A/C H.O Cr.

(Responded IBDA) This is how the complete process of sales and reimbursement of sales proceeds occurs. Encashment procedure of Inset, of Interest or and F.V. of S.P (A) In order to encash Instt. of Interest or and F.V. of S.P. customers bring coupons or and S.P. instrument directly to the S.P. issuing Bank. 1. 2. -Sus. A/C Encashment of F.V/lnt Dr. Bills payable A/C pay Slip issued Cr.

(With net payable amount after deduction). Or -Customers A/C Cr.

(With net payable amount after deduction.) 3. Other Liabilities A/C S. tax Cr.

(B) When other branch. of the Bank sends the Int. coupon/and S.P. instrument of their own customer with a hand written application from the customer and a forwarding letter by the branch. The following steps are done by the S.P. issuing Branch. 1. 2. Sus. A/C Encashment FV/lnt. Dr. Other Liabilities A/C Source Tax Cr.

(if applicable)

3.

SCB Gen A/C respective branch Cr. is

(Net payable amount after deduction of S. Tax if it applicable).

- The net payable amount is then sent by preparing an IBCA fvg. That branch. Reimbursement procedure of Interest /and F.V. of S.P. paid to the customer from B.B - After encashment of lnt./and F.V. of S.P. a statement is sent to B.B. with a forwarding letter. - Against this statement B.B. sends a credit advice to the branch. The S.P. issuing branch. Then makes reconciliation with the Cr. advice of B.B. and encashment statement sent earlier to B.B. Found every thing Ok and marking SCB Ok on the Cr. advice of B.B., S.P. issuing branch. (P.O.) then sends one photo copy of the advice to the CAD of HO. Then CAD of HO prepares the following vouchers: 1. Bangladesh Bank Dr.

2. SCB Gen A/C S.P. issuing branch Cr. An IBCA fvg. S.P. issuing branch, is then prepared and sent to the branch. After receiving the IBCA from Ho, S.P. issuing branch. Then responds the IBCA. The Responded IBCA then becomes the debit voucher of the branch. Treatment is as under SCBGen.AICHO Dr. (Responded IBCA)

2.

Suspense. A/C Encashment FV/lnt Cr.

Rate of Commission Sales: Tk. 1,000/- per sales of S.P worth Tk. 1, 00,000/Encashment: Tk. 0.25 per instrument. In this way the process of encashment of lnt./and F.V. of S.P. and reimbursement of the proceeds from B.B. on this behalf completed. Remittance is a very important section of General Banking Dept. In general, Remittance refers to Transfer of Funds. Remittances are of two types: 1. 2. Cash Remittance. Fund Remittance.

Generally, the remittance section of the General Banking Department does fund remittance. All kinds of issue and payment of 1. P.S. (PAY SLIP) 2. P.O. (PAY ORDER) 3. S.D.R. (SICURITY DEPOSIT RECEIPT) 4. D.D. (DEMAND DRAFT) 5. T.T, (TELEGRAPHIC TRANSFER) 6. F.D.R, (FIXED DEPOSIT RECEIPT) Etc is done through this section. This section also does transfer of funds from one A/C to another A/C and from one branch to other branch of the Bank or to other Banks.

Payment The PS instrument ultimately returns to the issuing branch of the bank for payment. The payee must affix a revenue stamp (signed or sealed by individual or company respectively) on the instrument before submitting it. The payee may submit the pay Slip to any bank. Though the process of clearing, it arrives at the issuing branch of the bank. The revenue stamp is checked and the date of payment is mentioned on the instrument and then the beneficiary account is credited accordingly. 2. Pay Order (P.O.): This is an instrument widely used by the customers for payment to a beneficiary for many different reasons. Issuance: The application form The customer has to apply through a duly filled up form after the banks chosen format where necessary information are mentioned. - Name and A/C no, bank and branch name of the beneficiary. - The amount. - The purchasers name and address. The instrument After the customer makes the payment (through cheque or cash) along with commission and after the payment is duly

acknowledged by the bank, an instrument containing three parts is issued. The first part is for the bank. The second part is for the purchaser. The third part is for beneficiary. After signing on the reverse side of the counterfoil, the purchaser receives the last two parts of the instrument which are duly authorized by the bank officials before the hand over. All the parts contain the P0 number and date. However the first and second part contains the purchasers & beneficiarys name and the amount but in the third part the purchasers name is not mentioned. Commission For every P.O., the bank gets a commission according to the rate mentioned below: For P.O. between Tk. 1/- 10,000/For P.O between Tk. 10001/- 1.00 lac/For P.O between Tk. 100001/- 5.00 lac/For P.O between Tk. 50000/- above : : : : Tk. 10/Tk. 25/Tk. 50/Tk. 100/-

A cost memo showing the amount of commission is issued for the purchaser. The amount of the P.O. is recorded under the title of account Bills payable pay order issued. The commission goes under Commission on remittance. Payment

Like the P.S. the P.O. instrument also ultimately returns to the issuing branch for payment.The third part of the instrument is given to the beneficiary by the purchaser.The beneficiary then submits this part to any bank and through the process of clearing payment is confirmed. Cancellation A P.O. may be cancelled in two waysa. The beneficiary may refund it (with released sign on the reverse side) in which case no cancellation charge in required. b. Otherwise, where the purchaser who has not given it to the beneficiary at all, has to submit an application along with the instrument with his sign on the reverse side and a cancellation charge of Tk. 15/3. Security deposit receipt (S.D.R) This instrument has the same function as the P.O. except that it is considered as deposit by the bank. Issuance The same application form for the P.O. is valid for S.D.R. The difference lies in the actual instrument which has two parts: for the bank and the beneficiary, where in the second part the purchaser name is is mentioned. Again it may be generated through crediting Sundry deposit A/C: SDR issued through simple credit voucher. Commission The rate of commission is same as P.O. Payment

Payment procedure is again same as that of P.O. But the beneficiary has to affix a revenue stamp on the reverse side of the instrument (signed or sealed) before submitting it. 4. Demand Draft (D.D.): The application form , which the customers must fill up

properly, contains the following information: - Name and address of applicant - Amount - In whose favor it is being drawn - Drawn on which branch. The instrument After the payment by the customer (though cheque or cash) is duly acknowledged by the bank, an instrument is prepared with- D.D. number - Date - Amount - Which branch it is drawn on According to the branch the D.D is being drawn on, a branchwise issuing serial number is put beside the printed D.D. no of the instrument. This is the controlling number. The Register An issuing register is maintained where the particulars of the D.D issued are recorded. The test number test number, having two parts, is given for the D.D by two authorized officers. A

serial number starts the test message. The other part contains a compendium of Branch code Day code Date code Currency code Amount code (If the amount of D.D. is less than Tk. 20,000/-, then no testNumber is needed) This number is very much an important secret. The responding branch will transfer the amount to the party A/C only if. When the test no. is agreed. Advice The D.D. payable proceeds are sent by post the payee branch by preparing an IBCA favoring the payee branch. The amount, test no. the P.A no of the two authorized officers is mentioned there. Charges & Commission The purchaser has to pay a fixed amount of Tk. 40! - As telex charge but if the Amount for the D.D. is below Tk. 20,000/- (up to 19,999!-) no telex charge is needed. A minimum commission of Tk. 25/- or Tk. 1/-per Tk. 1000/has to be paid as commission for the purchase of each D.D. A cash memo showing the amount of charges & commissions is issued for the purchaser. The commission is recorded under

the title of account I/A Commission on remittance. Payment (Inward D.D).Two kinds of situation may arise in case of payment of D.D. a. The advice from the issuing branch has not yet reached the responding Branch. In that case the D.D. is paid from the suspense A/C. Suspense A/C: D.D. paid without advice Party A/C. Cr. After advice reaches the responding branch. SCB General A/C (issuing br.) Suspense A/C: D.D. Paid W.A. Dr. Cr. Dr.

b. If advice is received before payment of proceeds to the customer: SCB General A/C (issuing branch.) Bill Payable: D.D. Payable Cr. Bills Payable: D.D. Payable Dr. Party A/C. Cr. A receiving register records all the particulars of a received D.D. Cancellation The branch receives application from the customer along with the instrument. Since the advice has been issued to the responding branch, if the purchaser wants to cancel the D.D. the issuing branch has to inform the receiving branch. That the instrument is in the possession of the issuing branch. Then the Dr. (Responded IBCA)

party may be paid from the suspense A/C. before the advice is returned. Suspense A/C: D.D. cancelled Party A/C. Cr. The payee branch is requested to send an IBCA to refund the amount debited from the suspense A/C. Responded IBCA from payee branch. -Dr. Suspense A/C. Cr. Again if the payee releases the D.D. no cancellation charge is required. Otherwise a cancellation charge of Tk. 30/- has to be paid by the purchaser. 5. Society For World Interbank Financial Transactions (T.T) This is another profoundly used means for fund transfer between countries. In this case, however, the customer must maintain an account with the branch. The application form: The first step is the submission of a duly filled up form (by the purchaser) ContainingName of the payee A/C and address Place, Amount Name of applicant, address, phone number. Commission & charges. Dr.

After the payment, the bank officials duly authorize the form.

The register Entry is passed to the SWIFT register, which records all particulars an outgoing T.T. Controlling and test number A responding branch-wise T.T number is put on the application form as well as a test number, like that of the D.D., which bears the same importance. Conveying the message The T.T. information- the test number, T. T. number, the amount, the power of attorney number of the authorized officers are conveyed over phone or through telex message by the authorized officer. T. T. Confirmation The T.T. confirmation is sent to the payee branch (by post) mentioning T.T. no., date, Test no., amount, beneficiarys name and A/C no. The authorized officers duly sign this. One copy of the T.T. confirmation is kept as the office copy. Charges & Commission The rate and procedure of charges & commission are same as that of D. D. except that the telex charge has to be paid at all times. Payment: (Inward T.T) After receiving branch, agrees with the T.T. test number only then it credits the party NC accordingly. The title of account that records the transaction for the receiving branch. are as follows :SCB General NC-issuing branch. Dr.

Bills Payable: T.T. Payable Bills Payable: T.T. Payable Dr. Party NC Cr.

Cr.

Entry is passed to the inward (receiving) T.T. register with all particulars. IBCA through T.T Inter Branch Credit advice are also sent and received by telegraphic transfer, mainly for quick fund transfer. Issuance of IBCA: Party NC/cash/cheque Dr. SCB General NC (responding branch) ..Cr. IBCA the responding branch is prepared and the IBCA no, date and test is conveyed over phone or telex. The accounting procedure for the responding branch It is the same as that of T.T. The only difference is when the actual IBCA reaches the branch it is not responded (since it has already been responded on the day it was received over phone) but marked as Vouched as on . . . This procedure is followed to save time and offer better client service. 6.Fixed deposit Receipt (F.D.R): FDR is a contact based deposit where the amount is deposited for a fixed period of time: I month, 3 months, 6 months, 1 year and so on. For each period of time a certain rate of interest (annual) is allocated. Issuance

Application the customer has to fill up the FDR application form to open an FDR A/C. The procedure is same as that of C/A or SIB A/C opening. Instrument After the application is authorized properly an instrument is issued where the date of issuing, the date of maturity, the name or names of the party are mentioned. Register A register is maintained for the issuance of FDR where particulars are recorder. Rate of interest I month -7.5% 1 year2 year3 year8.5% 9% 9.5%

3 month -8% 6 month 8.25%

Conditions of Encashment Two different situation may arise : on Maturity and before maturity. -Maturity in 3 months, will get no interest. - Maturity in 6 months, If encashed before it, the customer If encashed before it, the customer

will get interest at savings rate. -Maturity in 1 year, The customer may collect the interest

After the completion of every 6 months, if encashed after 3 months, he will get

Interest at SB rate. Or FDR rate Whichever is lower. -Maturity in 2 year, Again the customer may opt to collect

Interest of every six month, if enchased Between 1 year to maturity, he will get Interest at the rate of the period the Amount remained deposited. No interest Will be paid for fraction period. -Maturity in 3 year, If encashed before 6 months party will

get no Interest If encashed after that 6 month mt @ SB/FDR rate is given, whichever is lower. A daily maturity sheet accounts for all maturity and six months interest payment for FDR A/C. These are also accounted on monthly basis. If the customer fails to encash on maturity, the FDR is automatically renewed for the same period of time at the same rate, the previous. Principal amount along with the interest now considered as the new principle amount for the renewed FDR. Source tax At every withdrawal, 10% source tax if deducted the interest. Excise duty At any stage of transaction if the total amount (Principal + Interest) touches the range of excise duty cut, then at the time of encashment, excise duty is deducted from the whole amount of the F.D.R., usually at the end of the year.

FDR value Ex. duty

FDR Value

10,000/-I .00 lac Tk. 120 10,00,001/ 1.00 crore Tk. -500 1,00,001/- 10,00,000/-250 5,00,00,001/- above -5000 Payment of interest At first interest will be credited to FDR A/C. Then the excess amount (on deduction of 10% source tax) will be deducted from party A/C. The title of account is as follows:Adjusting A/C: Interest Payable on F.D.F. Dr. Expenditure A/C: Interest Paid on F.D.R. F.D.R. A/C Cr. (The interest for the complete Calendar months is recorded under Adjusting A/C and that of the fraction Calendar month remains under the expenditure A/C. Though actually the expenditure A/C. is debited and the adjusting A/C is credited at the completion of every month.) For deduction of 10% tax on interest F.D.R. A/C Dr. Other liabilities A/C. 10% Tax (deducted at source) Cr. For deduction of excise duty F.D.R. A/C Dr. Other liabilities: excise duty on deposit Cr. Encashment of F.D.R. Instrument (F.D.R.) Dr. Dr. 250 1,00,00,001/-5.00 crore Tk.

(For Principal amount) F.D.R. A/C Dr. (Total Int. deposited to F.D.R. A/C after Deduction of Source Tax and excise duty) Bills Payable P.O. /P.S. issued Cr. (Total amount payable to customer) Or Party A/C Cr. Every Instrument issued by the remittance section is crossed NC payee only. INSTRUMENT LOST: DUPLICATE ISSUED If any of the above-mentioned instruments gets lost or damaged, duplicate may be issued in its place. The process is as follows The issuing branches, after being notified by the purchaser of the loss/damage, informs the responding branch and the Head Office about the particulars of the lost instrument and request them to stop payment of that instrument. Head office then issues a circular to each branch for stopping payment of that particular instrument. After the confirmation reaches the Head office that no payment has been made for the lost instrument by any of the branch, it gives permission to issue duplicate. The purchaser has to pay duplicate issuing charge of 1k. 100/and sign an indemnity Bond, declaring that he/she will be liable for any damage due to the lost instrument, on a Tk. 150/- non-judicial stamp. Two witnesses also have to sign this

document. The Duplicate remains almost the same as the previous instrument. For example, the controlling number of the duplicate. D.D. remains the same though the printed serial on the block is changed. The duplicate issued will be marked Duplicate issued in lieu of original D. D. No. Registers that are maintained with the cash department are: 1. Cash Receive Register. 2. Cash Payment Register 3. Vault Register 4. Cash Balance Book. After going through the registers, I saw how the bills of Grameen Phone are received. There are three parts in a bill. After receiving the money from the customer, the cash officer transfers the bill receipt to the cash In-charge. The cash Incharge then signs and endorses the bill. One part of the bill is given to the customer; one part is kept to the bank and the other part in sent to the Grameen Phone. Then I observed how to make payment of cheque, the procedure is as such: at first the customer presents his cheque to computer counter and the computer operator then check the balance, send it to the Cash In-charge for checking of specimen signature. Cancellation of the cheque is necessary for the safety measure. If the amount of the cheque is more than five thousand then two power of Attorney (P.A) holder officers cancellation is required. After passing, the cheque is sent to the cash counter for payment; there the cash officer takes a signature on the reverse of the cheque and then makes payment to the customer. At the time of payment, the cash officer keeps the denomination of the

money paid to the customer. At the end of Banking hour closing of cash is done. Different steps of cash closing are as follows: Finalization of the daily transaction in (a) Cash Receive registers (b) Cash Payment register: v Cash balancing. v Preparation of the cash position. (Writing in the Vault register according to the denomination of note and maintaining the Vault Register. Cash Receive: Cash in received for the following there ways: 1. Different types of Bills like T & T, Grameen Phone. 2. Receipts of different accounts like SB., CD. and STD etc. In this case cash is received either in Pay in Slip or in Simple Credit Voucher (Only for FDR, BCD and PSP). 3. Different types remittance like TT, DD, SDR and P0 etc are received in their prescribed application form. + Cash Remittance Inward In Simple Credit Voucher SCB General P.O and cash received seal is put. This acts as the responding of IBCA sent by Head office. Lottery tickets are also sold by branch and thus the branch also receives cash. It can be done by two ways: 1. By the instruction of Head office, a new A/C can be opened with the organizations name and thus deposit in sale Proceeds goes to the opened A/C.

2. By the instruction of Head Office, the sales proceeds can be kept in Sundry creditor and after a certain time the total amount will be transferred to Head Office where HO will later send the commission amount by IBCA. Payment: Cash is paid in the counter by the following three ways: 1. Cheque of different types. 2. Cash Debit Voucher and 3. Pay slip. . A different type of Banks expenses that is made to Banks officials or staffs is made through cash debit voucher. Banks expenses and other payments other than cheques (such as NC is closed but the client is to be paid), which is paid to outsiders, is made through pay slip.

Consumer Loans
Three channels usually source the loan proposal. These channels are Share Distribution (Branches), Direct Sales and Priority Banking. If the applicant seems to be eligible, the channel sources the proposal and with complete documents forwards to Credit Unit provided by the RMs recommendation. Assessment CREDIT LINE PROPOSAL In this step of the term loan, the branch sends a credit line proposal to the head office for approval of term loan. The credit line proposal contains the following particulars:

Fresh/renewal/revision of the term loan Borrowers name Types of business Capital structure Particulars of previous transaction Existing vis--vis proposed credit limits Movement of the accounts Liabilities of sister concerns Particulars of proposed facilities, etc.

PROJECT APPRAISAL It is the reinvestment analysis done by the banker before a project he approved. Project appraisal in the banking sector needed for the following reasons: To justify the soundness of an investment To endure repayment of bank finance To achieve organizational goals To recommend if the project is not designed properly

TECHNIQUES OF PROJECT APPRAISAL An appraisal is a systematic exercise to establish that the proposed project is a viable preposition. The appraising officer checks the various details submitted by the promoter in first information sheet credit application form, feasibility report.SCB [PO] consider the following aspects in appraising.

A. Entrepreneur
Entrepreneur/promoter has to be creditworthy and competent enough to run the proposed industry.

Preference given for educated/knowledgeable sponsors, who know about their business concern, technical expertise and expertise in the line of proposed industry.

Who have own land and building for running the project? Have experience in working abroad. Sponsors with innovative ideas Sponsors must have net worth more then 2.5 times of the equity required for investment in the project. Who have good dealings with the bankers/out side parties and has social contacts and standings. Have an account in SCB Sponsors requiring group findings may be given financial assistance provided for each other etc.

B. Viability of the project

The project should be viable from organizational, technical,

commercial, financial and economic points of view. a) Technical viability: it implies the assessment of various requirements of actual production process. It involves a critical study of following factors. 1. Location and site of the project: selection of the optimum location, therefore, revolves around the joint consideration and evaluation of the following factors: Raw materials supplies Transportation facilities Power and fuel supply] Water and supply of manpower Nature and climate factor

2. Size of the project/plan: Size of the project/plan depends on the area covered by the project. It varies on project to project. 3. Technology, plant & equipment:

MAJOR PROBLEMS OF LRA IMPLEMENTATION: Inadequate or inaccurate data proved by the applicants. Unwilling to disclose information. Lack of auditors performance. Lack of experienced assessor. Credit appraisal: To assess the creditability of a borrower the bank must monitor the following things of the applicants: 6Cs: Character, Capacity, Cash, Collateral, Conditions, Controls 3Rs: Reliability, Resource, Responsibility Three questions that must be satisfactory answered in each credit application: 1. Is the borrower creditworthy? 2. Can the credit agreement be properly structured and documented so that the bank and its depositors are adequately protected? 3. Can the bank perfect its claim against the assets and earnings of the customer, so that, in the event of default, bank can be recovered? HEAD OFFICE APPROVAL

Up on receipt of the credit line proposal from the branch the head office appraises the project. If it seems to be viable one, the HO sends it to the Head office credit committee (HOCC) for the approval of the loan. The head office credit committee (HOCC) considers the proposal and tasks decision whether to approve the loan or not. If the loan is approved by the HOCC, the HO sends the approval to the concerned branch. SANCTION LETTER After getting the head, office approval the branch issues the sanction letter to the borrower. A sanction letter consist the following particulars amongst other details: Name of borrower. Facility allowed. Purpose Rate of interest Margin Period of the loan and mode of repayment. Security Other terms and conditions that is required.

The borrower received the latter and returns a copy of this letter duly signed by the borrower as a token of having understood and acceptance of the terms and conditions above. DOCUMENT If the borrower accepts the sanction letter, the documentation starts. Documents is a written statement of fact evidencing certain transaction covering the, legal aspects duly signed by the authorized persons having the legal status. For the term loan, documents should be obtained: Joint promissory note Certificate copy of memorandum and articles of association.

Latter of agreement Letter of disbursement Latter of installment Letter of continuity Latter of revival Letter of request Latter of counter guarantee Letter of lien Letter of hypothecation Letter of guarantee Stock report Thrust report Documents relating to mortgage

OBTAINING

CIB

REPORT

AND

OTHER

CONFIDENTIAL

REPORT FROM FINANCIAL INSTITUTIONS: The CIB report and other credit report from financial institutions is necessary to know about the borrowers, if he taken any loan facility from any financial institutions and if he taken then what is condition of previous transactions. It is helpful to judge the borrowers status. It can be known through Confidential report from other bank Credit information bureau report from Bangladesh bank Personal investigation
MORTGAGE What is mortgage? A mortgage is the transfer of an interest in specific immovable property for the purpose of the payment of money advanced or to the purpose of securing the payment of money advanced or to be advanced by way of loan, existing or future debt or performance of an

engagement, which may give raise to pecuniary liability. The transferors called a mortgagor and the transferee is called mortgagee. The principal money and the interest of which payment is secured for the time being are called the mortgage money and instrument (if any) by which the transfer is effected is called the mortgage deed. The term immovable property includes land, building and similar other assets.

The main characteristic of a mortgage is the mortgagor does not transfer the ownership of the property to the mortgagee. He transfers only some of his rights as an owner that means he cannot now sell the properly without the consent of the mortgagee. There are six types of mortgage, such as: 1. Simple mortgage 2. Mortgage by conditional sale 3. Unregistered mortgage 4. English MORTGAGE 5. Equitable mortgage 6. Registered mortgage The SCB generally practiced the equitable mortgage and the register (legal) mortgage in the branch. EQITABLE MORTGAGE In case of an equitable mortgage, the mortgagor deposits the title deeds with the mortgagee with the intention of giving the mortgagee an equitable interesting the property. It does not require the registration. It is only for the reliable clients of the bank. Procedure for equitable mortgage: 1. The mortgagor or his agent should deposit the title deeds relating to the property with the bank at a notified place. In case the advanced is made is made by a bank which is not situated at a

notified place, the title deeds may be deposited with the branch of the properly at a notified place is not required. 2. The mortgagor is required to send a covering latter with the title deeds acknowledging the deposit of title deeds with the intenation to create an equitable mortgage there on to secure a specific debt or debts. 3. The bank should accept documents only in original. Usually the bank gets a list of documents from its lawyer, which the mortgagor has to deposit with the bank. 4. The mortgagor has to furnish periodically an encumbrance

certificate declaring that no charge has been created against the mortgaged property subsequent to the date of the mortgage. 5. Periodical tax receipts shall also be verified. 6. In case the mortgage happens to be a limited company, the mortgage must be registered with in 30 days of execution of the mortgage. The disadvantages for this mortgage are property mortgaged can be realized, when required, only through the courts orders. This is a time consuming as well as expensive process.

REGISTER MORTGAGE OR LEGAL MORTGAGE In a mortgage, the mortgagor transfers to the mortgage the legal title to the property. The sub registry office must register it. On repayment of loan, the mortgage transfers the title to the mortgagor. Procedure of a legal mortgage: 1. An instrument mortgaging the property is executed. it is signed by the mortgagor and two witnesses.

2. The mortgage is complete as soon as the deed is registered but it will be effective from the date of execution. In case the instrument is not only duly attested and registered when it is so required, the mortgage will be void.However,he may use the instruments to establish personal convenient to pay. DISBURSMENT After verify all the documents the client disburses the loan to the borrower by issuing a cheque book. A loan is repayment schedule also prepared by the bank and given to the borrower. FOLLOW-UP After the disbursement of the loan, the bank follows the borrower in the following manner: Continuous supervision Working capital Stock report Break even analysis Rescheduling of repayment RECOVERY In general, the loans are repaid in installment. This installment is according to bank directives. Some loans are repaid all at a time. If any loan is not repaid then notices served to the customer. Sometimes legal actions also taken for recover the loan.

For the case of recover money by selling mortgage property.

For the case of recover liquid money

LEGAL ACTIONS If legal actions are need to take for recover the loan, the following procedure is followed,

Money suit (No security)

title suit

Decreed

Decreed

Money execution ..for the seize of property movable and immovable property

Title execution .Case .Advertisement sale for to sell

auction

.arrest on dewani court (for30/60) days party .Bidder .Sell at highest rate given

LOAN CLASSIFICATIONS AND PROVISIONING The loan classification procedure for all type of loan is governed by the guidelines contained in BCD circular by Bangladesh bank, in 1989 and a subsequently revised partially through BRPD circular no.16,issued in 1989.according to this circular the loan are classified on the basis of the following: CLASSIFIED STATUS TERM Unclassified Less then 11 Less then 6 Less then 6 months CC/OD MID-TERM TERM LOAN LONG-

months months Substandard months 6 to 8 months 6 to 11 months 9 to 11 months 12 24 and above 12 to 17 and above

12 to 17 months Doubtful 18 and above INTEREST CHARGE:

18 to 23 months Bad and loss

a) If any loan becomes classified like substandard [SS] and doubtful[DF]the charged interest should be preserved in interest suspense a/c b) Bed debt/loss a/c cannot be charged interest but in order to operate such or to mitigate the outstanding interest can be shown on interest suspense a/c. c) Only after the receiving the loan money the loan a/c can be shown on interest suspense a/c can be adjusted. PROVISION: TYPES OF CLASSIFICATION Unclassified Substandard Doubtful Bad/Loss RATE OF PROVISION 1% 20% 50% 100%

CARD PRODUCTS CREDIT CATDS What is a Credit Card? A credit Card is a piece of plastic used for purchasing goods & service and for obtaining cash disbursements on credit terms.

It is an unsecured credit, i.e. credit without collateral of security. Each cardholder is assigned a revolving credit limit by the issuing financial institution. Cardholders can purchase goods/services up to the credit limit and can re-use the credit facility upon repayment.

The

cardholder

is

billed

periodically

(usually

monthly)

for

repayment of the credit extended. The transactions during the period are summarized in the bill. Credit Card allows partial payments for purchases, but charges interest on the amount owed. Interest rates are traditionally higher than those charged on consumer loans. Cardholders can pay outstanding in full to avoid interest payments. Credit card is a safer substitute to cash and is the major made of payment worldwide. HISTORY OF CARDIT CARD The use of plastic money originated in the united states during the 1920s, when individual companies, such as hotel chains and oil companies, began issuing them to customers for purchases made at those business. This use increased significantly after World War II. In 1951, Diners club issued the first Charge Card to 200 customers who could use it at 27 restaurants in New York. With this system, the Credit Card Company charged cardholders an annual free and billed them on a monthly of yearly basis. Another major charge card was established in 1958 as the American Express Card by the American Express company. Later in the late 50, the Credit Card concept emerged where the Bank credits the account of the merchant as sales slips are received and assembles charges to be billed to the cardholder at the end of the billing period. The cardholder, in turn, pays the bank either the entire balance or in monthly installments with interest. The first Credit Card Bank Americard was issued by Bank of America in last 1958 in California, USA. This system was licensed in other states starting in 1966 in California, USA. This system was licensed in other states starting in 1966, and was renamed as VISA in 1976. At the some time, three different groups of

banks that were not franchisees of Bank of America began activities that would later merge to become todays MasterCard International. Both organizations originally set out signing up member banks to issue cards, enroll merchants, and /or both. Competition was fierce. Banks that offered one card could not handle the other, thus losing money. More importantly, the merchants themselves were being forced to turn down sales from customers who did no carry the same card the merchant accepted. In 1978 the Master Card International and VISA International organizations agreed to a concept of duality, in other words, banks could honor and issue Credit Cards. KEY BENEFITS OF STANDARD CHARTERED CREDIT CARD Wide Acceptance

Standard Chartered Bank (SCB) issues both VISA and MasterCard Credit Cards, the two renowned Credit Card brands. Standard Chartered Taka Credit cards are accepted at more than 4000 outlets across Bangladesh. Cardholders can use their cards in Hotels, Restaurants, Airlines, Travel Agents, Departmental Stores, Supermarkets, Hospitals & Diagnostic Centers, Jewelry Shop, Electronic & Computer Shops, Mobile & Internet Service outlets. Petrol pumps etc. Easy Facility Standard Chartered Credit Cardholders have the flexibility to make payment of as little as 5% of the outstanding balance and carry forward the rest of the balance. Supplementary Card Standard Chartered Credit Cardholders can enjoy the convenience of having supplementary cards for cardholders spouse, children over 10 years of age of family members of friends. The primary cardholder can set a spending limit for the supplementary card which limits the maximum amount that the supplementary cardholder can spend in one billing cycle. Cash Advance Facility Repayment

SCB Credit Cardholders can get instant cash advance up to 50% of card limit from of the SCB ATMs, thus having access to cash 24 hours a day. Besides, from any of the SCB ATMs, thus having access to cash 24 hours a day, besides, All Coverage SCB Taka (both primary & supplementary) Credit Cardholders are automatically enrolled into all accident insurance coverage. Silver cardholder are insured for BDT 100, 00/- and Gold cardholders are Covered for BDT 500,000. Safety Net Permanent Disability Insurance ((TPD) of the primary cardholder, Scheme the total Accident insurance

This is a unique offer of SCB Credit Card. In case of death or Total outstanding balance on the card in waived by the bank. All cardholders are automatically enrolled into the program and are charged a nominal free of 0.35 on their monthly balance for availing this facility. Insta Buys This exclusive feature allows SCB Taka Credit Cardholders to enjoy installment loan facility on their Credit Card at an interest rate of 16.95% under this plan, Cardholders can transfer any purchase greater than BDT 5000/- into instalment loan and repay in Equal monthly installments (EMI).cardholders have the flexibility to pay-off in 6,12,18,24,30, or 36 Monthly installments. Moreover, special promotions are run with specific merchants where customers can Insta Buys Facility at 0% Interest. Rewards Program

Under this plan SCB Taka cardholders are rewarded for using their cards at merchant outlets. For every 50 Taka spent, cardholders earn 1 treasure points can be redeemed at any time to against with variety of gifts offered by Standard Chartered Bank. Auto pay Bills

This exclusive feature allows SCB Credit Cardholders to pay their Monthly utility bills through Credit Card by a Standing instruction. Cardholders can avail this facility to pay their monthly mobile phone bills of Grameen Phone / AKTEL / City Cell / Banglalink or Internet bills of Agni / BOL / Access Tel or Cable TV bill of Prisma Digital. Besides electricity bill of DESA / DESCO can also be settled through this facility. SMS Facility This feature provides cardholders as easy 24-hour direct access to their Credit Card balance information through their Grameen Phone Mobile, Cardholders availing this service will also receive a monthly ministatement through SMS, absolutely free of charge. E-Statements This is a secure and prompt way to receive Credit Cards monthly statement through e-mail address instead of receiving a paper statement. Cardholders can choose a maximum of 3-e-mail address for receiving their statements. In case delivery failure (for any reason), paper statement will be sent to the cardholders mailing address. Banking

Procession of Credit Card Applications Step Applications submitted to any SCB branch or credit card sales team are forwarded to the Credit Card operation (CCO) unit for capturing data into card application processing system (CAPS). This process usually takes one working day. Step Applications are then forwarded to the consumer credit unit (CCU) for necessary credit assessment. After credit review, all approved application specifying credit limits are sent back to

card Operations. The rejected applications are forwarded to sales teams for review of comments. Step Approved applications received at CCO are sent for contact point verification (CPV) by outsource agencies. The agency verifies the telephone no. residence and business address of the applicant and forwards a report on each applicant to CCO. Step After receiving all CPV report, CCO forwards the approved applications along with CPV report to CCU for further review. CCU revisits applications and any application with negative CPV is declined. Previously set credit limit may be reviewed at this point based on CPV report. Step After this final review from CCU, approved applications are sent back to CCO for opening card accounts and producing plastics and PINS. CCO sends a system generated intimation to the applicants whose Credit Card applications are declined. Step CCO arranges to deliver the Card and PIN at customers mailing address.

Common Reasons for declining a credit card application

Incomplete documentation: - Less than 3/6 months bank statements - More than 2 months old bank statement

- Documents not duly authenticated

Financial capacity of the Customer: - Debt Burden Ratio > 50% - Poor delinquency History of any other loan account with SCB - Earnings not meeting minimum required income.

Others: - Negative contact pint verification (CPV) report - Non-availability of telephone (Off/Res.) - Existing credit cardholders

Credit Card Statement Cardholders are sent monthly bills/ statements detailing transactions and outstanding on their Credit Card accounts during the b9illing cycle. Cardholders have the option to choose paper statement or estatements, whichever they find convenient. All card accounts are assigned a billing/ statement date at the time of accounts opening. Customer accounts can have billing dates from 1st to 22nd of every month. Staff accounts statement date is 23rd of every month. All Bank Charges like finance charges/ late fee/ over-limit fee etc. are applied on the billing/ statement date.

 Payment due date mentioned on the statement is set as 15 days after the statement date. Current Balance on the statement is the total outstanding balance of the account as of eh statement date. Minimum Amount due is calculated as 5% of Current Balance of BDT 500 (local cards)/ USD 10 (International cards), whichever is higher. Cardholders must pay the minimum due amount by the payment due date to keep card account regular.

PART- C: Collection
Collection unit results: Improve the effectiveness of my results by using proven collection Contribute to the quality of each telephone call and provide a high Maintain productivity standards by understanding how to use proven Main process: Verify information. Obtain Reasons For Delinquency-RFD. Explain benefits to pay. Get kept promise. Account Documentation: Concise summary and abbreviated negotiation skill. level of customer service to the customers. collection techniques. o notes. A. Verify information Mailing Address day time and evening number Mobile phone, relative etc

B. Obtain Reasons For Delinquency-RFD. *Why is the account past due? *What is the customers present financial situation? * Is the customer and/ or spouse working? *Explain benefits to payaccording to the severity of the delinquency. Delinquency 1st Month 2nd Month 3rd month C. Get kept promise. *How much? -Always being the negation requesting the total amount due. *When? -A specific date. *How? -payment at the branch -money order - Payment by mail. *Where? -at the branch -ATM *What are the sources of funds? -cash on hand -commission cheque -bonus cheque -relatives -borrowing the money from a friend -loan -selling a possession Questioning techniques: Benefit= Avoiding a consequence. . .. .

Collection is a sales job. Some mission is to convince the customer to pay him the total amount due today. Use motivation and persuasion to create urgency and to overcome the customers objections. Questioning is a critical tool in the counseling process. Questions are tools toA. B. a) b) c) Determine ability and willingness to pay. Identify the customers needs and expectations. 1. If we are looking toUnderstand the customers position about the specific situation. Confirm that the information provided was understood. Verify an agreement During the counseling process, we need to ask different types of questions to get various results. Closed questions are used to verify specific information and can only be answered with No or Yes. -Did you receive your statement? -Have you changed job? -Do you have a pen to take down my number? -Would you take a message? -Is he at work? 2. If we are looking to a) Obtain information about customers current financial situation. b) Understand alternatives to make short term payment arrangement. c) What programs does the customer quality for? d) Know which actions the customer is considering to resolve the situation. An open-ended question seeks information and allows for a wide range of answers and often requires a several sentence response or longer explanations. Some examples are Why did you miss the payment? How can you feel behind? What obstacles prevent you from paying today? When will you make the payment? Where will you pay? Where are you getting the money to pay? Who is responsible for the account? Who can take a message?

How often do you speak to him?

The use of open-ended questions will help eliminate faculty assumptions and bring about more effective communications.

Collection Negotiation techniques Approach and Attitudes Characteristics of effective sales people I. II. III. Good product knowledge Understand where be wounds Communication skills IV. Negotiation skill

CHARACTERISTICS OF COLLECTORS Effective collectors snare qualities: 1. Inquisitive(ask good question)-Effective collectors ask the right questions to find out why customers arent paying and get the information they need to obtain a firm promise to pay. 2. Good listeners-Effective collectors ask appropriate questions, and listen to the answers so that they develop a payment arrangement that is tailored to the customers situation. 3. Clear communicators- Effective collectors phrase their questions and comments in ways that are readily understood and realize that customers want clear communicators. They also have good voice qualities-tone, volume, and rate. 4. Use Good judgment- Effective collectors know how to balance being firm, air and friendly. They also know when to bring a call

to a conclusion (i.e. they dont let a customer ramble on after a promise to pay has been agreed upon), and they know when to stress the urgency of paying immediately. 5. Knowledgeable-Effective collectors know how to follow the negotiation sequence and which remedies to select to resolve the account situation. They also know what they can and cannot do within the policies of the bank, as well as legally. 6. Self-confident-Effective collectors words communicate the

impression that they are in control. They are firm and fair.They know how to do their jobs and are prepared to negotiate a mutually satisfactory payment arrangement. 7. Motivated/Persistent-Effective collectors have lots of drive and persistence to keep going, call after call and customer after. This helps them achieve effectiveness, quality and productivity goals. They measure their success by their results and strive to be the best at what they do. 8. Positive attitude-Effective collectors react positively to objections and resistance to making or keeping a promise. They are not stopped by the first no or excuse that they encounter. When customers start giving excuses for not paying, these collectors go to work to overcome the objections to pay. 9. Persuasive-Effective collectors motivate customers to act on the importance of honoring their commitments and maintaining a good credit rating. They personalize their approach to the customer and gain the customers commitment. That helps in negotiating better payment arrangements. 10. Imaginative-Effective collectors are creative in tailoring

solutions to fit customers circumstances. They adapt readily to

different customer types and have lots of good techniques at their fingertips. An excellent collector needs to: 1. Consistently perform the basics-Excellent collectors are good at the basics and put them into practice every day, on every account and during every contact. 2. Use their time effectively-Excellent collectors dont waste time. They review account information and notes quickly and correctly so they can get right to the point when talking to customers. 3. Adapt their approach to the customers- Excellent collectors realize that people are different and react differently to collection situation. When they try to educate and motivate, they tailor their approach to the customer. 4. Adapt their strategy to the customers situation- Excellent collectors realize that situations are different and call for different approaches and remedies. Although they may have an initial strategy for resolving a problem, they are flexible enough to change their approach as they surface additional information during a call. 5. Obtain good promises to pay and firm commitments- Excellent collectors can detect insincere agreements and ask the customer enough questions to determine whether a particular solution is truly workable. 6. Turn broken promises into kept promises- Excellent collectors know how to identify the customers problem through effective questioning and listening and then how to address it with the customer.

7. Learn from past experience- Excellent collectors always assume that they can do the various parts of their job better, and actively look for ways to improve. They learn from their mistakes, as well as their successes. 8. Team players- Excellent collectors share ideas and contribute suggestions, help train other collectors and make recommendations to improve the process.

Establish

the

importance AND

and

relationship as

of

MONITORING, tools for

MEASUREMENT

MOTIVATION

fundamental

effective supervision in a collection call center. Define the need for call MONITORING and understand WHEN, WHY, HOW, MUCH and HOW to monitor telephone collectors. Learn COACHING and FEEDBACK techniques to improve the performance of telephone collectors performing below job standards and motivate high performers to perform at optimum levels. Define and develop consistent FORMATS and PROCEDURES to review telephone collectors performance.

THE 3 MS OF COLLECTION MANAGEMENT An effective supervisor should practice and become an expert on the 3 Ms to meet business goals and objectives. MONITORING Permanent/Ongoing Call Monitoring-is one of the most important responsibilities of collection supervision to reinforce effective performance.

Call Monitoring is a very useful technique to evaluate and improve collectors skill and is, undoubtedly, the foundation to structure productive feedback in individual or group sessions. The primary objectives of call monitoring in a collections operation are: Identifying opportunities-for collectors to improve their

communication skills in order to get firm commitments to pay from customers Ensuring that collectors are following company policies Verifying compliance-with laws and regulations

Secondary objectives may include improving the quality of customer service, identifying training needs, recognizing good performance, and improving the relationship between supervisors and collectors. MONITORING CATEGORIES There are different ways to implement Monitoring. They are

complementary and using different combinations of techniques results in an objective and precise evaluation of collectors performance. When monitoring calls, a supervisor should evaluate certain characteristics including: Content .The content of the call is determined by listening to the telephone conversation between the collector and the customer. A supervisor observes the collectors speaking and listening skills, the duration of the call, how the collector identifies the situation, and the way the collector makes decisions. A supervisor will distinguish the type of call and analyze the collectors ability to address the situation quickly and appropriately. Call Duration. Call duration may be impacted by how quickly collectors can access system information. It is not unusual for a

collector to need to view at least three screens to handle a call: the predictive-dialing interface screen which is the initial screen a collector may view that displays basic account information, the collection database which may include historical and financial information and real-time payment information from host system, for example. Collectors frequently spend a lot of time flipping through screens to get information. This time can be greatly reduced by using specialize tools such as workflow and customerrelationship management software. After-Call Work Time-A critical factor that infects productivity in a predictive-dialing environment is after-call work time or update time, the time a collector spends updating the customers record with the call results. Experienced collectors usually update the customers recode during the conversation. Best practices indicate that in an early delinquency collection operation, optimum time usage is at least 85% talking to customers and 15% or less updating the record. To minimize after-call work time many collection operations use abbreviations and codes to recode call results. Performance Feedback. There is strong value in giving immediate performance feedback to the collector about the handling of calls monitored. Giving corrective feedback by positively coaching collectors assists them in making immediate improvements. Managing the call and controlling the Conversation 1. 2. Puts the facts on the table Explain the status of the account. State the last activity on the account. keep it in the present Ask for the money. Information Gathering Use open- close questioning technique. Extract information without jumping to conclusions.

 and ability to pay. 3. Bridging interrupt. Chapter

Find out RFD. Classifying the customers response to identify willingness Develop the sales strategy. Listen Get on the customers side. Acknowledge. Overcome the emotions. Lead the customers back to the negotiation. 4 Tips for the managing angry customers Need to avoid charged words like-Problem. Instead use Let the customer vent his or her frustrations and do not If a customer use obscene language, advice him /her Do not take what the customer says personally. Delinquency, Provisioning and Legal Action: The level of delinquencies is determined based on the number of days loan installment(s) is/ are missed by the customer. more neutral language, such as situation; occurrence, etc.

you will disconnect the call if he or she continues.

SWOT ANALYSIS OF SCB Strength: 1. Usage of poster PC banking software cards 400 2. Efficient administration 3. Fewer default loan in credit card 4. Co-operation with each other

5. Good banker- customer relationship 6. Strong Financial Position 7. Energetic as well as smart work force. Weakness: 1. Shortage of Branches & ATM machine 2. Customer awareness 3. Shortage of men 4. Shortage of Merchant Opportunity: 1. Huge fairness area credit card. 2. Growth of sales volume 3. introducing new facilities for credit 4. Introducing ATM & Branch in our rural area. Threats: 1. Different classic services of other Banks. 2. Political unrest 3. Entrance of new private Bank. CUSTOMER VIEW Customer satisfaction is the extent to which a product or services received performance matches a buyers expectations. If the product or services performance falls short of expectations, the buyer is dissatisfied or delighted. SATISFACTION: FROM THEORETICAL

Expectations are based on customers past buying experiences, the opinion friends and associates, and marketer and competitor

information and promises Marketer must be careful to set the right level of expectations I they set expectations too low, they may satisfy those who buy but fail to tract enough buyers In contrast they raise expectations too high, iyers are likely to be disappointed can arise either from a crease in product and service quality or from a increase in customer pectations. In either case, it presents an opportunity for companies that rn deliver superior customer value and satisfactions

Todays most successful companies rising, expectations and delivering rformance to match. Such companies track their customer expectations, rceived company performance and customer satisfaction

Highly satisfied istomers produce several benefits for the company Satisfied customers

e less price sensitive, remain customers for a long period and talk vorably to others about the company and its products and services

Although the customer-centered firm seeks to deliver high customer satisfaction relative to its competitors, it does not attempt to maximize customer satisfaction. A company an always increase customer satisfaction by lowering its price increasing its services, but it may result in lower profits. Thus, the purpose of marketing is to generate customer value profitably. This requires a very delicate balance, the marketer must continue to generate more customer value and satisfaction but not give away house. Now, we have a very good idea regarding the importance of customer satisfaction. So, it is also important for the company to know about the satisfaction level of the customers. When any problem is identified, it becomes easier to solve the problem. In the next part of my paper I have focused on the customer satisfaction factors of. That has been followed by my primary research; a survey to find out the customer satisfaction level of Credit Card.

Concluding Remarks As a first generation private bank, Standard Chartered Bank has come a long way to reach its present stature. In addition, we are proud to be a part of this pioneer of private sector banking. However; every organization has its brighter side as well as a few difficult ones. In order

to minimize the difficulties, we should be careful in reshaping our venture and efforts to obtain the goal. The meaning of Service for the banking sector is constantly being reshaped. Most international banks and some local private banks have already introduced all-time-case-line, telephone banking, and On-line banking in their service fleet. Therefore; we also should try to revitalize the quality and quantity of service. We must say, the initiative taken to introduce the Various Cards Issued by SCB combining A.T.M. Card, Credit Card, Debit Card and Utility Bills payment Card all in a single card is a great step on part of the Bank to improve its customer service. In this way, we should reshape our products and introduce innovative ones in such a competitive market composition in which we stand. Since the prime concern of a bank is to impress its client not only through financial service but also through a cordial environment, our attention should always be focused on this subject. The Bank has decorated it officers beautifully, but in the present decor, the shortage of sitting arrangement for clients remains a conspicuous weakness, despite the very cordial and efficient service offered by the employees. While our experience will serve as the pre-amble for future success, we should also try to gain a perfect and dynamic vision for the future, since an imperfect past can make the future tense. In addition, we are the ones to make the tension-free and bright future-a future that must necessarily be better than today. Thank you all for your patient perusal.

WORKS CITED 1. ZEITHAML, VALARIE, BITNER, MARY. SERVICE MARKETING MACRAW-HILL, 1996

2. www.stardandchartered.com Standard Chartered web site. 3. Credit Card Procedure Manual. 4. RESEARCH MEIHODOLOGY METHODS & TECHNI QUES - BY CR KOTHART. 5. METHODOLOGY OF RESEARCH IN SOCIAL SCENCE -BY DR. O. R. KRISHNAWAMY