FUNCTION OF CUSTOMER SERVICE DEPARTMENT OF

AGRICULTURAL DEVELOPMENT BANK LIMITED

TANSEN BRANCH

BY
Sudha Nepal
Symbol No. 21790/18
T.U. Reg No. 7-2-49-205-2018

An Internship Report Submitted to

Faculty of Management, Tribhuvan University

in the partial fulfillment of the requirements for the degree of

Bachelor of Business Administration

at the

Tribhuvan Multiple Campus

Tribhuvan University

Tansen, Palpa
August, 2023
FUNCTION OF CUSTOMER SERVICE DEPARTMENT OF
AGRICULTURAL DEVELOPMENT BANK LIMITED,
TANSEN BRANCH

BY
Sudha Nepal
Symbol No. 21790/18
T.U. Reg No. 7-2-49-205-2018

An Internship Report Submitted to

Faculty of Management, Tribhuvan University

in the partial fulfillment of the requirements for the degree of

Bachelor of Business Administration

at the

Tribhuvan Multiple Campus

Tribhuvan University

Tansen, Palpa
August, 2023
 STUDENT’S DECLARATION
This is to certify that I have completed the Internship report entitled “Function of
Customer Service Department of Agriculture Development Bank Limited,
Tansen” under the guidance of Mahesh Bhattarai in the partial fulfillment of the
requirements for the degree of Bachelor of Business Administration at Faculty of
Management, Tribhuvan University. This is my original work which I have not
submitted earlier elsewhere.

-------------------
Sudha Nepal
July, 2023

ii
INTERNSHIP CERTIFICATE

iii
 APPROVAL SHEET

Submitted by:
SUDHA NEPAL

is an academic work submitted in partial fulfillment of the requirements for the degree
of Bachelor of Business Administrative (BBA), Tribhuvan University under my
guidance and supervision. To the best of our knowledge, the information presented in
the internship report has not been submitted earlier and the intern successfully
defended the report at Tribhuvan Multiple Campus, Tansen Palpa.

………………… ………………… ……………………..

Mahesh Bhattarai Keshav Ghimire Tanka Prasad Bhattarai
Supervisor Program Director Campus Chief

iv
 ACKNOWLEDGEMENTS

The entire effort of this report has been made simply to give the complete shape to the
partial fulfillment of the BBA 8th semester program of Tribhuvan University entitled
“Function of Customer Service Department of Agriculture Development Bank
Limited, Tansen Branch”. I have ardor a great deal to embellish the subject matter in a
most simple and easily understandable form.

Banks play vital role in any countries‟ economic boom so, I feel lucky for having a
chance of being involved in such a prestigious and beneficial privilege. Henceforth, I
like to show my huge gratitude to Tribhuvan Multiple campus and Tribhuvan
University as well for providing the students such a platform which helps them to
have insight of various aspects of banking sector.

I would like to extend my thankfulness to Mr.Yadav Prasad Bhattarai, Mrs. Anjana

Kafle, Mr.Dhurvatara Bashyal and other staff of ADBL for the support and co-
operation for making my internship period a memorable one and a big achievement in
my career.

I am greatly indebted to our Coordinator Keshav Ghimire for his support and
guidance towards completion of report and heartily thankful to instructor or
supervisor Mahesh Bhattarai for his supervision to bring out this project and for
providing necessary support and guidance and also to all of my friends who helped
me in the final completion of this report.

Sudha Nepal

August, 2023

v
 TABLE OF CONTENT

TITLE PAGE………………………………………………………………………….i

STUDENT’S DECLARATION ................................................................................. ii

INTERNSHIP CERTIFICATE ................................................................................. iii

APPROVAL SHEET ................................................................................................ iv

ACKNOWLEDGEMENTS ....................................................................................... v

TABLE OF CONTENT ............................................................................................ vi

LIST OF TABLE ...................................................................................................... ix

LIST OF ABBREVIATIONS .................................................................................... x

CHAPTER I .............................................................................................................. 1

INTRODUCTION ..................................................................................................... 1

1.1 Background ................................................................................................. 1

1.2 Objectives of the Study................................................................................ 2

1.3 Methodology ............................................................................................... 2

1.3.1 Organization selection .......................................................................... 3

1.3.2 Placement/Duration .............................................................................. 3

CHAPTER II ............................................................................................................. 4

INTRODUCTION OF THE BANKING INDUSTRY ............................................... 4

2.1 Overview of the banking industry .................................................................... 4

2.2 Evolution of bank............................................................................................. 5

2.4 Current situation of commercial bank in Nepal................................................. 7

2.4.1 Paid-up capital of bank .............................................................................. 7

2.4.2 Total deposits and loan of bank ................................................................. 7

2.4.3 Total profit of bank ................................................................................... 7

2.5 Opportunity and challenges .............................................................................. 8

2.5.1 Opportunities ............................................................................................ 8

vi
 2.5.2 Challenges ................................................................................................ 9

CHAPTER III.......................................................................................................... 10

INTRODUCTION OF ADBL.................................................................................. 10

3.1 An overview of Agriculture Development Bank ............................................. 10

3.1.1 Vision ..................................................................................................... 10

3.1.2 Mission ................................................................................................... 10

3.1.3 Objectives of ADBL................................................................................ 10

3.1.4 Capital Structure of ADBL ...................................................................... 11

Table 3.1.4 ....................................................................................................... 11

3.1.5 Organization structure of ADBL ............................................................. 11

Table 3.1.5 ....................................................................................................... 11

3.1.6 Product and service of ADBL .................................................................. 12

3.1.7 Financial highlights ................................................................................. 15

CHAPTER IV ......................................................................................................... 16

ANALYSIS OF ACTIVITIES DONE AND PROBLEM SOLVED ......................... 16

4.1 Activities performed in Customer Service Department ................................... 16

4.1.1 Account opening ..................................................................................... 16

4.1.2 Signature scanning .................................................................................. 17

4.1.3 Attending customers and dealing with their queries ................................. 17

4.1.4 Cheque book issuance ............................................................................. 18

4.1.5 Statement issuance .................................................................................. 18

4.1.6 Balance inquiry ....................................................................................... 18

4.1.7 KYC update ............................................................................................ 18

4.1.8 Help customer to fill up deposit voucher and cheque book ...................... 19

4.1.9 Filing and record keeping ........................................................................ 19

4.2Activities performed in credit department ....................................................... 19

4.2.1The procedure for granting loan ............................................................... 19

vii
 4.3Problem identified and solved ......................................................................... 20

4.4 Gap between theory and practice .................................................................... 21

CHAPTER V........................................................................................................... 23

CONCLUSION AND LESSION LEARNT ............................................................. 23

5.1 Conclusion ..................................................................................................... 23

5.2 Lesson learnt .................................................................................................. 24

REFRENCE

ANNEXURE A

ANNEXURE B

ANNEXURE C

viii
 LIST OF TABLE

Table 3.1.4 Capital Structure………………………………………..11

Table 3.1.5 List of board member……………................................11

Table 3.1.7 Financial Highlight ……………………………………14

ix
 LIST OF ABBREVIATIONS

ABBS: Any Bank Banking System

AOA: Article of Association

ASBA: Application Supported by Blocked Amount

ATM: Automated Teller Machine

BBA: Bachelor in Business Administration

CIB: Credit Information Bureau

CRN: Customer Reference Number

CSD: Customer Service Department

DMAT: Dematerialized

ECC: Electronic Clearing Cheque

FD: Fixed Deposit

KYC: Know Your Customer

LC: Letter of Credit

MOA: Memorandum of Association

MICR: Magnetic Ink Character Recognition Code

RTGS: Real Time Gross Settlement

SMS: Short Message Service

SWIFT: Society for Worldwide Interbank Financial Telecommunication

x
 1

CHAPTER I

INTRODUCTION

1.1 Background

Customer service department of the banking institution devotes its function towards
the satisfaction of the customers. It is oriented towards customers and basically
manages all the customers’ queries and if possible tries to solve at the front desk of
the organization. In this department the major tasks involved are videlicet: Dealing
with customers, opening and closing of accounts, handling incoming calls, providing
accounts statement, issuing check books, providing Debit Cards to the customers,
maintaining record of ATM card holders, providing e-banking facility, etc. Customer
service department deals with handing the various customers’ queries, and their
grievances. It also aims at gathering feedback about our banking financial services
and promptly responding to their raised problems. The customer service department
plays an important role in the survival and continued functioning of any company.
Although there are many different roles that a customer service department plays, two
major functions of the department that affect an entire business include public
relations and the creation of a positive company culture. The importance of quality
service is now well accepted, and service-based organizations are addressing
increasing attention to service excellence in their corporate strategy and planning, in
the anticipation of achieving a differential advantage over their competitors (Vincent
& Mitchell, 1990). The tasks and activities of customer service representatives are
directly related to these two major functions.

 Public relations

 Providing customer satisfaction

This internship report entitled functioning of customer service department at

agricultural development bank is prepared as per the partial fulfillment of the degree
of Bachelor in Business Administration (BBA), Tribhuvan University. Being the
student of BBA, the students are honored by the internship program under this
curriculum. It helps the students develop their inner ability or the confidence level and
the level of understanding to compete in this complex and sophisticated age. It also
increase the ability of the student to tackle the business problems, to take the
 2

opportunities and to face the threats. In its totality, internship program teaches us the
corporate culture, develops our public relationship skills, makes us competent and
provides us an excellent working experience. Internship programs help educational
institutions to get reputation by strengthening their bonds with business world,
availability of research grants, receive positive feedback from corporates on their
curriculum and increase job opportunities for their students (Beard, 1998).

1.2 Objectives of the Study

The purpose of the study statement helps the subject assess the importance of the
study relative to individual values. The main aim of study is to write a report about
the experiences and knowledge that had gain during the internship period. The
specific objectives of the report can be shortlisted as follows:

1. To know about the general activities that are undertaken in customer service desk.

2. To know the product and services offered by the ADBL.

3. To study about the overall banking system and banking processes.

4. To know about the functioning of the various departments.

1.3 Methodology

Methodology refers to the various sequential steps in the study. A systematic method
is required to pick out an actual result for any type of study. This report is based on
secondary sources of data.

The methods used for collecting information are:

Primary source
The primary data are collected from different methods like observations, interaction
and communication with the customers and staffs and also through guidelines from
staffs of different departments.

Secondary source
The secondary data are collected from website of the bank, brochures, published
reports and other related websites.
 3

1.3.1 Organization selection

As per the rule of Tribhuvan University (T.U.) every student of BBA 8 th semester has
to work as an internee at any chosen organization. The internee can select the type of
organization for his/her internship and submit a recommendation letter provided by
the campus to the organization.

1.3.2 Placement/Duration

The internee took a recommendation letter from the campus, and submitted it to the
branch manager of ADBL with a handwritten application along with curriculum vitae.
The ADBL approved the internee’s request to join the bank for the internship
programme and provide placement with the date to join the bank for the same.

During the eight week’s internship period, the internee was placed in the customer
service department. All the factors such as discipline, attendance, regularity, interest
towards the work, sincerity, behaviour, and the efforts that I made to understand the
banking functions were closely monitored.

As per the requirement of the Tribhuvan University’s BBA Curriculum, an internee

has to complete eight weeks’ internship period in the work place. The duration of
internship started from Falgun 1st 2079 and ended Jestha 7th in 2080 . During this
period, the internee came to learn about the working environment, working procedure,
culture and structure of the organization.
 4

CHAPTER II

INTRODUCTION OF THE BANKING INDUSTRY

2.1 Overview of the banking industry

The bank is a financial institution which deals with cash inflows, outflows, credits and
lends money to the needy, accepts the deposits and acts as intermediary between the
lenders and the borrowers (Prabhavathi & G, 2018). It is a financial institution which
deals with the monetary transactions. The major function of the bank is to accept
deposits and providing loans. The bank attract deposits from various investors by
providing certain rate of interest, and investing the accumulated funds as loans to
others who are in need of fund by charging slightly higher rate of interest than they
provide to the depositors. Bank acts as an intermediary who bridges the gap between
the savers of fund and the users of fund. Basically, banks are those financial
organization that offer the widest range of financial services especially credit, saving
and payment services and perform the widest range of financial functions of any
business firm in the economy.

According to Commercial Bank Act 2031 B.S, A commercial bank refers to such type
of bank which operates currency exchange transactions, accepts deposits, advances
loans, performs dealing relating to commerce except the banks which been specified
for the cooperative, agricultural, industry of the similar other specific objective.

A bank generates a profit from the differential between the level of interest it pays for
deposits and other sources of funds, and the level of interest it charges in its lending
activities. This difference is referred to as the spread between the cost of funds and
the loan interest rate. Historically, profitability from lending activities has been
cyclical and dependent on the needs and strengths of loan customers. In recent
history, investors have demanded a more stable revenue stream and banks have
therefore placed more emphasis on transaction fees, primarily loan fees but also
including service charges on an array of deposit activities and ancillary services
(international banking, foreign exchange, insurance, investments, wire transfers, etc.).
Lending activities, however, still provide the bulk of a commercial bank's income. As
the financial system plays an important role in modern economics and the
 5

intermediary function of the banking industry has a core role in influencing economic
growth (Klein, 1971).Central banks are normally government owned banks, which are
the authorized body to supervise commercial banks, or controlling the cash interest
rate. They generally provide liquidity to the banking system and act as Lender of last
resort in event of a crisis. Nepal Rastra Bank e central bank of Nepal.

2.2 Evolution of bank

The banking industry that we have today is the outcome of a series of stepwise
development that have occurred in the process of its evolution. The banking sector
went through the process of evolution due to the unceasing demand for the
improvements in service delivery and the increasing need and expectations of
customers as well the political reforms that have taken place over the decades. The
banking sector is the section of the economy devoted to the holding of financial assets
for others, investing those financial assets as leverage to create more wealth and the
regulation of those activities by government agencies (Hall, 2018).

The early bankers are the Lombard who was originally from the plains of Lombardy
of Northern Italy. They introduced banking practice in England. These Lombard were
eventually bankrupted because they lent money to kings who did not repay them.

After the Lombard, the goldsmiths practiced banking as a sideline to their normal
activities in the bullion and jewelers fields. The early goldsmiths used to have large
vaults, which were soundly built and heavily guarded. The person who deposited his
surplus funds with the goldsmith became a 'depositor' and naturally paid for the
privilege of having his money defended this way. These payments were called 'Bank
Charge'. The depositors who needed funds to pay wages or debts, could call at the
bank and collect such sums as required.

The very first banks were probably the religious temples of the ancient world where
gold was stored. Their owners justly felt that temples were the safest places to store
their gold as they were constantly attended, well built and were sacred, thus
dissuading the would-be thieves. There are existing records of loans from the
18th century BC in Babylon that were made by temple priests to merchants. Ancient
Greece holds further evidence of banking. Greek temples as well as private and civic
Greece holds further evidence of banking. Greek temples as well as private and civic
entities conducted financial transactions such as loans, deposit, currency exchange,
 6

and validation of coinage. Interestingly, there is evidence too of credit, whereby in

return for a payment from a client, a money lender in one Greek port would write a
credit note for the client who could “cash” the note in another city, saving the client
the danger of carrying coinage with him on his journey.

Ancient Rome perfected the administrative aspect of banking and saw greater
regulation of financial institution and financial practices. Charging interest on loans
and paying interest on deposits became more highly developed and competitive. The
bank of Venice, established in 1157A.D is supposed to be the ancient bank.
Originally, it was not a bank in real sense being simply an office for the transfer of the
public debt. Subsequently, Bank of Barcelona (1401) and Bank of Geneva (1407)
were established. The ‘Bank of England’, first English Bank, was established in 1694
A.D. The ancestors of modern day banks have been attributed to the merchants, the
goldsmiths and the moneylenders. Thus, todays bank are competitive and customer
too. Bank customers’ perceptions of the level of reliability, responsiveness, security
and reputation is significantly higher than those of conventional banks. (Saleh, Quazi,
& Gaur, 2017)

2.3 Introduction of banking industry in Nepal

The history of banking in Nepal is believed to be started from the time of Prime
Minister Ranoddip Singh in 1877 A.D. He established TejarathaAdda to provide
credit facilities to the general public at a very concessional interest rate. The Tejarath
Adda disbursed credit to the people on the basis of collateral of gold and silver. All
employees of government were also eligible for this type of loan, which was settled
by deducting from their salary. Tejaratha Adda extended credit only; it did not accept
deposits from the public.

But the modern banking started with the establishment of Nepal bank limited in 1994
B.S which was founded by Judda Shumsher. It was the first bank of Nepal. Its main
function was to provide loans and accept deposits. Similarly, Nepal Rastra Bank was
established as a central bank in 2013 B.S. The bank was completely government
ownership bank and it also started to issues notes since 2016 B.S. Additionally,
former Industrial development center established in 2013 was converted into Nepal
Industrial Development Centre in 2016 to support industrial development and
Agricultural Development Bank was established in 2024 B.S. to support agricultural
 7

development. Furthermore, Rastriya Banijya Bank was established in 2022 B.S. as a

government owned commercial bank. Furthermore the detail current situation of bank
in Nepal is described below.

2.4 Current situation of commercial bank in Nepal

Currently, all together 20 commercial banks are operating in Nepal. Among them,
some of the commercial banks have meet the capital requirement prescribed by NRB
some are not. Some have higher profitability some have low profitability. All the
commercial banks in Nepal is in Annexure A.

2.4.1 Paid-up capital of bank

Paid up capital is the money provided by the shareholder into the company since the
establishment. It includes the initial fund accumulated from the shareholder plus
additional capital injected through right/bonus shares or FPO as the company moves
forward. Higher the capital greater the financial strength and vice versa. As per
investopaper Global IME bank has the highest paid up capital of Rs 35.77 Arba
followed by NIMB bank has Rs 34.12 Arba and the least paid up capital bank is
Standard Chartered Bank with paid up capital of Rs 9.42 Arba. Paid up capital of all
commercial bank is in Annexure B.

2.4.2 Total deposits and loan of bank

In fiscal year 2079/80 total of Rs 50.04 Kharba has been collected by all 20 the
commercial banks .Among which Global IME Bank had collected highest amount of
deposit form the customer that is Rs 426.33 Arba followed by Nabil Bank with
deposit amount of Rs 396.84 Arba. And the least deposit is collected by Standard
Chartered Bank Rs 117.5 Arba. Similarly in fiscal year 2079/80 Global IME Bank has
provided the highest amount of loan that is Rs. 356.39 Arba and Standard Chartered
Bank as least amount of loan that is Rs. 77.86 Arba. Deposits and loan of the
commercial bank is in Annexure C.

2.4.3 Total profit of bank

The net profit of all the commercial banks of Nepal in fiscal year 2079/80was Rs.
70.17 Arba where Nabil Bank lead the chart with net income of Rs. 7.52 Arba and
 8

Machhapuchchhre Bank as least net profitable organization with net income of Rs.
1.854 Arba. Total profit of other commercial bank is in Annexure C

2.5 Opportunity and challenges

Since, Nepal is the developing country, banking and financing sector also evolving
itself in a quite good pace. There are various opportunities and challenges for banking
sector in Nepal. Some of them are mentioned below:

2.5.1 Opportunities

Some of the opportunities that the commercial banks can get in Nepal to maximize
their net income are:

2.5.1.1 Internationalization

In Nepal, there is large number of banking institutions including joint venture bank of
international bank, the competition in the financial market is very tough. So, the
decision taken by the NRB for increasing paid up capital is to make the banks and
financial institutions international standard and obtain the international competencies.

2.5.1.2 Political stability

With the advent of political stability in Nepal, the doors have been opened to safe and
lucrative investment opportunities. The commercial banks can disperse their fund and
invest the fund in various productive sector.

2.5.1.3 Technology advancement

With rapid change in technology, the commercial banks can gain first mover’s
advantage in the field and capture large number of customers. If they are able to
utilize this resource to their benefit, they can ensure premium customer service,
ensuring customer loyalty and thus, profitability.

2.5.1.4 Reach of banking service

There are still large numbers of people out of the door from banking services. As half
of the total area of nation is still out of the reach of banking service. It provides the
great opportunity for banking institution to expand its banking services across the
country.
 9

2.5.2 Challenges

Besides these opportunities, there are a number of challenges which might be face by
every banking institution.

2.5.2.1 Minimum paid up capital requirement

Nepal Rastra Bank, the central monetary authority has directed bank and financial
institutions to raise minimum paid up capital by up to four times to whopping 8000
million and 2500 million for commercial and development Bank respectively. Which
is kind of sweat dropper for banks because there are large number of banks and all of
them are not able to meet these criteria.

2.5.2.2 Liquidity crisis

One of the major challenges of banking sector is liquidity crisis which is directly
affecting the operation of bank the current scenario. People are not exactly using
banks for their financial activities. People have money but at the same time banks are
facing liquidity crisis.

2.5.2.3 Big merger concept

As there are news and talks about the concept of big merger in banking sectors. Lot of
financial experts are referring it as ‘Too Big Too Fail’. Therefore, this is one of the
current and serious challenges of banks of Nepal.

2.5.2.4 Federal system

NRB directs every commercial bank have to open at least one branch in municipality
of the state. As the operational cost of opening a branch and deploying employees in
various municipalities is more than the income or profit incurred from them, this
poses threat to the profitability to the bank.

So these are some of the major opportunities and challenges that the Nepalese
commercial banks and financial institutions face in performing their activities. By
making proper utilization of these activities bank and financial institutions can
increase their net income and reduce the operational costs. Not only the mentions
above there are move other factors that have positive as well as negative impact on
the performance of the bank and financial institutions which are not mentioned above.
 10

CHAPTER III

INTRODUCTION OF ADBL

3.1 An overview of Agriculture Development Bank

With the main objective of providing institutional credit for enhancing the production
and productivity of the agricultural sector in the country, the Agricultural
Development Bank, Nepal was established in 1968 under the ADBN Act 1967, as
successor to the cooperative Bank. The Land Reform Savings Corporation was
merged with ADBN in 1973. Subsequent amendments to the Act empowered the bank
to extend credit to small farmers under group liability and expand the scope of
financing to promote cottage industries. The amendments also permitted the bank to
engage in commercial banking activities for the mobilization of domestic resources.

Agricultural Development Bank Limited (ADBL) is an autonomous organization

largely owned by Government of Nepal. The bank has been working as a premier
rural credit institution since the last three decades, contributing substantial agricultural
credit supply in the country. Hence, rural finance is the principal operational area of
ADBL. Besides, it has also been executing Small Farmer Development Program
(SFDP), the major poverty alleviation program launched in the country. Furthermore,
the bank has also been involved in commercial banking operations since 1984.

3.1.1 Vision

To be a mass-based complete bank serving from urban to rural.

3.1.2 Mission

To deliver comprehensive banking solution strengthening its extensive network.

3.1.3 Objectives of ADBL

1. To provide quality banking services,

2. To adopt market driven strategy,

3. To obtain sustained and competitive return on investments.

 11

3.1.4 Capital Structure of ADBL

The capital structure of Agricultural Development Bank is shown in Table 3.1.4.

Table 3.1.4
Capital structure of ADBL
Capital Amount
Authorized capital Rs.25,000,000,000
Paid up capital Rs.18,884,386,078

(Source: www.adbl.com.np)

3.1.5 Organization structure of ADBL

Every organization has some kind of organizational structure in order to carry out the
functions. Organizational structure shows the hierarchy of authority and different
functional units in the organization. As ADBL is a government organization which is

Table 3.1.5

List of Board Member

S.N Name of directors Position in board
1 Ram Sharan Pudasaini Chairman
2 Mr. Uttar Kumar Khatri Member
3 Dr.Rajendra Prasad Mishra Member
4 Mr. Govinda Prasad Bhattarai Member
5 Mr. Sanjeev Paudel Member
6 Mr. Binod Kumar Guragain Member
7 Mrs. Rita Subedi Independent member
8 Mr. Himalal Paudyal Company Secretary
Source: www.adbl.gov.np
controlled by the government and carry out its transactions as per rules, regulations
and policies stated in Nepal Rastra Bank directives. So to perform the activities the
organization must have a effective organizational structure and the organizational
structure of Agriculture Development Bank is as followed by BOD and Management.
The organizational structure is depicted in Table 3.1.5.
 12

3.1.6 Product and service of ADBL

ADBL has offered various types of services to its customers. It's major commercial
banking products and services include

3.1.6.1 Deposit

ADBL collects deposits from individuals, institutions, business and different other
sources. It offers its customers various deposit accounts such as; current account,
simple saving account, fixed deposit account, ba-ama saving account and different
other deposit account schemes and provides certain interest rates in return as per the
account’s nature.

3.1.6.2 Loans and Advances

ADBL provides various loan products to its customers such as; auto loan, home loan,
education loan, agricultural production loan, livestock loan, small and cottage
industry loan and many other loan schemes in return of certain interest rates
depending on the nature of the loan.

3.1.6.2.1 Business loan

A business loan is debt that the company is obligated to repay according to the loan‟s
terms and conditions. It is given to the business enterprises. The business loans
provided by ADBL are:

3.1.6.2.1.1 Funded Loan

 Overdraft/ hypothecation loan

 Hydropower and alternative energy loan
 Bridge gap loan
 Tourism service loan
 Trust Receipt loan
 Export loan
 Industry loan
 Consortium loan

3.1.6.2.1.2 Non funded loan

 Letter of credit
 13

 Bank guarantee

3.1.6.2.2 Retail/ consumer Loan

Retail loan provides finance to fulfill personal needs of customers. The various retail
loan provided by Agriculture Development Bank to fulfill the need and satisfaction of
the customers are mentioned as follows.

 Household loan

 Home loan

 Education loan

 Gold and silver loan

 Loan against fixed deposit

 Agricultural loan

 Employee service loan

 Loan against government securities

 Vehicle loan and others

3.1.6.2.3 Agriculture Loan

ADBL welcome grower farmers, processors, traders, marketers (wholesalers,

retailers) to take advantage of prioritized credit services provided by the bank in
various sub-sectors of agriculture. As the main objective of the ADBL is to facilitate
the farmers by providing the loans and advance facilities at the minimal rate of
interest. The different type of the agricultural loans provided by the Agriculture
Development Bank is listed below:

 Livestock

 Horticulture

 Floriculture

 Aquaculture

 Apiculture
 14

3.1.6.2.4 Remittance

Remittance department is responsible for exchanging foreign currency with Nepalese

currency. ADBL provides remittance facility to its customers by performing various
transactions such as; fax transfer, pay order, money transfer through IME, Prabhu,
Himal, Siddartha, and Prithvi remit. Remitters from abroad can transfer Western
Union Money Transfer Services. Likewise, ADBL has been transferring
money(Indian currency) to major cities of India by ssuing draft which is payable
either by Standard Chartered Bank or ICICI Bank on the customer’s request.

3.1.6.2.5 SWIFT

Taking advantage of being an active member of SWIFT, ADBLoffers money transfer

service. Your account with us can be credited from any bank in the world via SWIFT.
The following simple information is required to help us for speedy credit of funds into
your account.

 SWIFT Code: ADBLANPKA

 16-digitaccount number with ADBL

 Name of accountholder

 Location of Branch Office

3.1.6.2.6 SMS/ Mobile Banking

ADBL Mobile Banking provides convenient mechanism and quick access to banking
services for Agriculture Development Bank customers from their mobile devices. The
main features of the Mobile Banking services are Balance enquiries, last transactions
details, transactions alerts, e-recharges/bill payments/top up etc. The customer can use
the mobile banking service through mobile by downloading ADBL Mobile Banking
application.

3.1.6.2.7 Any Branch Banking System (ABBS)

ADBL has been providing Any Branch Banking Service to the all branches across the
country to help the customers get the amount from anywhere and any place within
Nepal. This is the new innovative product that is introduced by the commercial banks
in Nepal. Previously ABBS is done by charging certain amount but now many bank
 15

have made ABBS free in Nepal. In this kind of facility, the sender can send the money
from any branch within Nepal and the receiver can receive the money from anywhere
within loan.

3.1.6.2.8 Trade Finance

Trade financing is the innovative way of doing the business as it facilitated the trading
of goods and services by making transactions through the banks and financial
institutions. Through the widespread and strong network of correspondent banking
relationships, ADBL is capable to offer various products related to international trade
suitable to the needs of customers. Some of the major products and services in this
regard are as follows

 Letters of Credit (local, import and export)

 Various types of Bonds/Guarantees (including counter guarantees)
3.1.7 Financial highlights

Being one of the trusted banks in Nepal, Agriculture Development Bank has been

Table 3.1.7
Financial highlights as on 31stAshad2080
Particulars Total Amount
Paid up capital Rs 18,884,386.08
Reserve and surplus Rs 11,729,718.40
Deposits from customers Rs199,486,613.57
Loans & advance to customers Rs171,699,191.33
Net interest income Rs 8,080,400.86
Operating profit Rs 4,544,214.35
Net profit Rs 3,099,337.08
Distributable profit Rs 2,007,156.98
Nonperforming loans 2.48%
Earnings per share Rs 20.62
Net worth per share Rs 211.6
(Source: https://www.sharesansar.com/newsdetail/agriculture -development-bank-fourth-quarterly-
report/)
Growing in all sectors along with the growth of the Nepalese financial market. The
financial highlights like deposits, loans and other of the bank as of 31 stAshad 2080 is
listed in Table 3.1.7Above table shows the detail of total cash inflow and outflow of
Agriculture Development Bank in 4th quarter of fiscal year 2079/80.
 16

CHAPTER IV

ANALYSIS OF ACTIVITIES DONE AND PROBLEM SOLVED

4.1 Activities performed in Customer Service Department

The involvement as an intern in the ADBL in Tansen branch, was very fruitful from
aspect of gaining the practical expose to the banking industry as well as to the
corporate world. Facing the various situations in the branch helped me develop a new
insight of the works performed in the banking industry. The analysis of the activities
performed in the various departments is given below:

4.1.1 Account opening

With the proper verification of all required documents, new account is opened. It is
very essential to know all the details of customers before opening of an account.
While opening the account, bank uses Know Your Customer policy. This policy helps
the bank to get all the related information of its customers. When a customer opens an
account in a bank, the bank and the customer enter into a contractual relationship.

The procedures for account opening are:

a) Any interested customers who wish to open an account in ADBL are inquired
about the type of account he/she wants open, then customer are provided with
account opening form and are requested to fill up account opening form and
attached all required documents. Documents required are:

For personal accounts:

 Citizenship certificate of both nominee and accountholder

 Utility bills

 Two passport size photos of account holder and one of nominee

For company accounts

 Certificate of incorporation

 Memorandum of Association (MOA) and Articles of Association (AOA)

 Minute

 Tax registration certificate (PAN)

 17

 Citizenship certificates of all signatories

 Tax clearance document

b) Then the information submitted by the proposed account holder is verified and
screening of the account holder and nominee is done through Trust Anti-Money
Laundering (AMLs) to see if they are fraudulent.

c) After screening, screening ID is generated and account holder are assigned with
low, medium or high risk and if all documents are satisfactory account opening
process is continued.

d) Account number is given as per registered sequence following computer system

rule to open the account in computer.

e) Then the customers are asked to deposit the minimum balance required as
prescribed in the assigned account number and directed to show the deposit slip
duly receipted by teller.

f) Then customers are provided with cheque book.

g) If customers want to avail them of debit card and mobile banking services then the
debit card and mobile banking application form is filled up and he /she told that
they will be informed through mobile SMS or a phone call after their service is
ready.

h) Signature is scanned for the computer access. The newly opened account is
recorded in account opening book for the future reference.

4.1.2 Signature scanning

Another task carried out in CSD was signature scanning of account holders. At first
account opening form is placed in the scanner and signature cards are scanned and
registered in their respective accounts. In the same way, I performed the task of
updating the signature, photo or logo of respective account holders in case customers
change their logo or signature and while doing KYC update.

4.1.3 Attending customers and dealing with their queries

The Customer Service department is the first department where the client pays a visit
at the beginning when they enter the bank. Customers are asked about their purpose of
visit. It mainly deals with individual customers to solve their question regarding the
 18

providing necessary information about the bank. Here the intern formally handles all
the account opening/closing, cards and complaints. It aims at satisfying customers by
queries of the customers by himself or with the help of supervisor in CSD. As a result
of which customers were properly supported by clarifying their queries in the
customer service department.

4.1.4 Cheque book issuance

When new account is opened or previous cheque book finishes, customers demand for
the new cheque book submitting the slip provided by the bank with authorized
signature. New cheque book should be given to the customers after proper inquiry and
verification of signature. Similar to statement issue, cheque books are not provided to
unknown person or even family member unless the accountholder makes written
request.

4.1.5 Statement issuance

It is the responsibility of the CSD to generate account statement of customer upon the
demand from the customer. The bank statement shows the transaction occurred during
certain time period as well as the remaining balance in the account. The bank
statement is given only to the accountholder and must be signed by them for validity.
Statements of accountholder are not provided to unknown person or even family
member unless the accountholder makes written request.

4.1.6 Balance inquiry

Whenever the client wishes to know balance in their account, the internee provided
the information to them. However, such private information is not provided to people
other than the accountholders even to the family members.

4.1.7 KYC update

KYC is an abbreviation for “Know your Customer”, a term used for customer
identification process. It involves making reasonable efforts to determine true identity
andbeneficialownershipofaccounts,sourceoffunds,thenatureofcustomer's business,
reasonableness of operations in the account in relation to the customer's business, etc.
which in turn helps the banks to manage their risks prudently. The objective of the
KYC guidelines is to prevent banks being used, intentionally or unintentionally
 19

criminal elements for money laundering. KYC has two components - Identity and
Address. While identity remains the same, the address may change and hence the
banks are required to periodically update their records.

4.1.8 Help customer to fill up deposit voucher and cheque book

Intern helped customer to fill up on the cheque and on deposit voucher incase
customers are illiterate and does not know how. Intern filled account number, amount,
accountholder's name, drawer's bank name for deposit voucher.

4.1.9 Filing and record keeping

As the operational duties of the CSD staff, all the documents related to customers
need to be properly recorded in the system and the hard copy is filed in a systematic
filing system for proper future reference. All the documents including that of account
opening form, cheque requisition, account close, renewal forms, mobile banking,
Internet banking, ATM request, pending documents, all are properly filed in their
respective files. Thus, the various activities performed by the intern are as follows:

 Collecting all account opening, E-banking, Mobile banking, DMAT forms.

 Prepare files for account opening, E-banking, Mobile banking, and DMAT
separately.

 Putting all forms according to their account number to their respective files.

 Put these files in the cabinet according to their number.

Here the intern learned about the vertical and horizontal filing methods.

4.2Activities performed in credit department

After seven weeks of placement in CSD, intern got a chance to learn about credit
department for remaining one-week period. Some of major activities performed in
credit department are as follows:

4.2.1The procedure for granting loan

The major department of a bank is the loan department. Generally, a loan can be
classified into two part: Funded loan and Non-funded loan. Home loan and Vehicle
loan are some examples of funded loan. Similarly, Letter of Credit and Guarantee are
 20

some example of non-funded loan. To get a loan, the customer has to follow some
steps which are as follows:

 Customer as to submit real and proved salary or income document to the bank.

 Valuation certificate of his/her collateral.

 Certificate from Credit Information Center LTD (CIB) should be submitted. The
chances of getting loan highly depend on this CIB certificate.

 Site visit (collateral visit) by the bank to check valuation is authentic or not.

 Loan application from the customer to the bank.

 Bank prepares a proposal and sends it to the head office.

 After verified by the bank, customer signs on loan agreement paper.

 Finally, the bank provides a loan to the customer according to the bank’s loan
disbursement criteria.

 The loan must repay in monthly installment within 5 to 15 years.

Intern has assisted customers for various documents required at various stage in this
procedure. From this loan procedure intern learned about importance of CIB
certificate and document required to get a various type of loan.

4.3Problem identified and solved

Throughout my internship, I managed to solve different problems as per my

capability, knowledge and with assistance from the staffs. Some of them includes:

Throughout the internship period, as an internee following are problem faced and
solved, some of the problems such as:

1. Lacks confident while communicating with senior level staffs.

2. Lack of proper knowledge to use the system in the bank.

3. Searching various files, documents and information of the customers when needed.

4. Difficulty in addressing customer’s enquiries and providing them relevant

information.

5. Internal data and financial transactions are checked time to time to solved the error
in data entry.
 21

The above problems that I faced during my internship period were solved with the
help of senior interns and other staff members of the bank.

4.4 Gap between theory and practice

The analysis of the gap between theory and practice given below which is based on
the experience gained during the performance of the activities and the observation
made during the period of performance:

1. Many small things are to be kept in mind along with the confidentiality of
information of the customers.

2. No particular theory can be developed regarding how to deal with

customers because each and every customer is different in perception and
attitudes.

3. Documents are kept without proper filing which make the work delay
while searching the file.

4. Since the entire activity of the bank is dependent upon the computer
network, any interruption or failure of network results in work delay and
customer dissatisfaction.

5. Different branches of same bank have different ways of working and

customer grievances can be seen on this nature of working.

6. Employee's performance is not seen as per the responsibilities given by the

bank, the performance is far than it has to be in fixed hours.

7. Bank has large number of documents of customer information in the written form
which needs to be managed systematically to gain information promptly whenever
required

8. Computerized system fully depends upon performance of the employees

so many errors were seen for example: in KYC update due to negligence of
the employees itself.

9. Formal line of communication among employees.

10. The task of dealing with the various natured customers is indeed a very difficult
task.
 22

11. The intern of dealing less tasks to be performed in the credit and cash department
by themselves as they need enough of the time to know the technical and legal aspects
of the tasks and its sensitivity.

12. The activities in the CSD are simple yet challenging and repetitive yet sensitive.
 23

CHAPTER V

CONCLUSION AND LESSION LEARNT

5.1 Conclusion

This period of internship in Agricultural Development Bank Limited was a very

fruitful experience. From this internship, the knowledge about the working
environment, the banking activities was gained and on-the-job experience of bank was
realized which shall prove to be a great experience. Due to the interaction with
different people, variety of skills were gained and the involvement in the activities of
different departments of a commercial bank, the experience gained will definitely be
very helpful for future career development.

The involvement of the intern in the activities of Customer Service Departments

(CSD), Loan Department and Cash Department provided a lot of knowledge about the
banking system, its working system, and communication and inter-personal skills to
deal with customers, senior employees and co-workers. The study helped the intern to
draw the outline about the working activity of Customer Service Department (CSD),
Loan department and cash department as well.

Thus, from this internship I gained the following lessons:

1. For any organization customers are the crucial part that determines the success or
failure of the institution. Satisfied customers are the reasons for any successful
organization.

2. The working process of dealing with customers while providing service and
handling complaints and queries should be satisfactory enough to retain the existing
customers and attracts new ones. Customers are ready to be linked to the branch if
they get satisfactory service.

3. Time management skill and its importance were learnt. One has to deal with
numbers of customer at once, so everyone should be equally treated.

4. Role of communication and inter-personal skill while handling the customer is very
crucial in CSD to motivate the customer and maintain healthy relationship with them.
 24

5. The employees in the CSD give first impression to the customers. So, they should
have a good level of self-confidence while dealing the customer along with the skill to
deal with them properly.

6. Patience is the key to handle the customers. One has to be calm in any kind of
situations while dealing to the customer.

5.2 Lesson learnt

It was great experience for me in ADBL as an internee. In those eight weeks I learnt
about the whole banking process and nature of bank functioning. In the period of
intern I get to know the various service and product offered by bank like various
deposit schemes and loan related schemes. I also learnt to deal with the customer and
making coordination among the staffs. Similarly I also found the knowledge regarding
functioning of banking department their coordination and team work to achieve the
organizational goal. Beside the organization, I learnt to enhance my personal qualities
and skill too. The major key skills I noticed and learnt were:

Communication skills

Daily interaction with the staffs and the customer has enhanced the communication
skills.

Teamwork skills

Almost all the activities during the internship period were performed in collaboration
with other interns and staffs which has helped in further understanding about
teamwork skills.

Negotiation skills

Dealing with customer complaints and their enquiries has further helped in building
up the negotiation skill.

Analytical skills

It was necessary and important to observe and analyze different scenarios within the
bank which has helped in enhancing the analytical capacity.

Problem-solving skills

Many challenges and problems were faced in course of the internship period and they
were solved with the help of supervisors.
 25

And one needs to have a strong attitude to complement these skills in order to perform
various tasks within an organization. Thus, the major attitudes that I learned during
the internship period were:

Initiative

One of the key attitudes one should hold is initiative ness and that’s developed
through the internship experience.

Punctuality

Punctuality is the indicator of professionalism. It was highly considered in the bank

by the officials and got to learn the same thing as well.

Self-confidence

The experience during the internship period helped a lot to boost the confidence
within myself.

Patience

Since I spent almost of my internship period in the CSD department where it was
most important to have patience while dealing with the customers.
 REFRENCE

Hall, M. (2018, January 28). Retrieved from What is banking sector?:. Investopedia.

Klein, M. (1971). A Theory of the Banking Firm. Journal of Money, Credit and
Banking. Congent Economics & Finance, 3(1), 205-218.

Prabhavathi, p., & G, D. D. (2018). Banking: Definition and Evolution. International

Journal of Scientific & Engineering Research, 9(8), 745-753.

Saleh, M., Quazi, A., & Gaur, S. (2017). Quality and image of banking services: a
comparative study of conventional and Islamic banks. International Journal of
Bank Marketing, 35(6), 17-24.

Beard, D. (1998). The status of internships/cooperative education experiences in

accounting education. Account Education, 16(3/4), 507-516.

Vincent, L., & Mitchell, W. (1990). Defining and Measuring the Quality of Customer
Service. Marketing Intillegence and Planning, 8(6), 11-17.
 ANNEXURE A
LIST OF COMMERCIAL BANKS IN NEPAL

S.No Name of Banks Establishment

1 Nepal Bank Ltd 1937
2 Rastriya Banijya Bank Ltd 1966
3 Agriculture Development Bank Ltd 1968
4 Nabil Bank Ltd 1984
5 Standard Chartered Bank Ltd 1987
6 Himalayan Bank Ltd 1993
7 Nepal SBI Bank Ltd 1993
8 Everest Bank Ltd 1994
9 Siddhartha Bank Ltd 2002
10 Citizens Bank International* 2007
11 Prime Commercial Bank Ltd 2007
12 NMB Bank Itd 2008
13 Machhapuchhre Bank Ltd 2012
14 Sanima Bank Ltd 2012
15 Global IME Bank Ltd* 2023
16 Laxmi Sunrise Bank Ltd* 2023
17 Nepal Investment Mega Bank Ltd* 2023
18 Citizens Bank International Bank Ltd* 2023
19 Prabhu Bank Ltd 2023
20 Kumari Bank Ltd 2023
(*Joint operation date after merger)
(Source: https://en.m.wikipedia.org/wiki/List-of-banks-in-Nepal)
 ANNEXURE B
PAID UP CAPITAL OF COMMERCIAL BANK

Second quarter Financial report 2079/80(Rs in Arba)

Name of Banks Paid-up Capital
Global IME Bank Ltd 35.77
Nepal Investment Mega Bank Ltd 34.12
Nabil Bank Ltd 27.05
Kumari Bank Ltd 26.22
Prabhu Bank Ltd 23.54
Laxmi Sunrise Bank Ltd 21.67
Himalayan Bank Ltd 21.65
Prime Bank Ltd 19.4
Agricultural Development Bank Ltd 18.88
NMB Bank Ltd 18.36
Rastriya Banijya Bank Ltd 15.63
Nepal Bank Ltd 14.69
Siddhartha Bank Ltd 14.08
Citizen Bank Ltd 14.2
Sanima Bank Ltd 12.46
NIC Asia Bank Ltd 11.56
Everest Bank Ltd 10.69
Mchhapuchchre Bank Ltd 10.25
Nepal SBI Bank Ltd 10.12
Standard Chartered Bank Nepal 9.05
(Source: https://www.investopaper.com/news/paid -up-capital-of-commercial-bank-in nepal/
 ANNEXURE C
Deposits, Loans and Net profit of commercial banks in fiscal year
2076/77(Rs in Arba)

Net
Deposit Loan
Name of Banks profit
2079/80 2079/80 2079/80
Global IME Bank Ltd 426.33 356.39 7.25
Agriculture Development Bank Ltd 199.49 171.7 3.1
Nepal Investment Mega Bank Ltd 354.41 303.7 4.29
Prime Commercial Bank Ltd 174.06 154.48 2.26
NMB Bank Ltd 210.3 189.32 3.41
Rastriya Banijya Bank Ltd 321.66 230.13 4.91
Kumari Bank Ltd 316.05 270.57 1.95
NIC Asia Bank Ltd 311.37 262.1 4.65
Prabhu Bank Ltd 289.09 238.21 2.82
Nabil Bank Ltd 396.84 332.7 7.52
Laxmi Sunrise Bank Ltd 296.24 253.7 2.26
Himalayan Bank Ltd 275.31 230.13 3.26
Nepal Bank Ltd 244.55 178.89 3.41
Siddhartha Bank Ltd 223.65 184.05 3.19
Everest Bank Ltd 197.93 160.21 3.39
Sanima Bank Ltd 175.93 145.4 2.61
Nepal SBI Bank Ltd 150.83 116.72 2.24
Machhapuchchhre Bank Ltd 154.18 126.47 1.85
Citizens Bank International Bank Ltd 168.84 140.4 2.21
Standard Chartered Bank Ltd 117.5 77.86 3.52
(Source: https://www.investopaper.com/news/net-profit-deposit-loan-commercial-banks-inNepal)