General Banking Activities of Banking System in Bangladesh.: 1. Account Opening Section

General banking activities of banking system in
Bangladesh.
 There are 57 unlisted bank have in Bangladesh. General banking is the
starting point of the banking operation. It is the department which provides day-
to-day services to the customers. Main functions of general banking department
are the following:
Accounts Opening Section.
Cash Section.
Clearing Section.
Remittance Section.
Accounts Section.
1. Account Opening Section:
The relationship between banker and customers begins with the opening of an
account by the customer. Opening accounts binds the banker and customers into
contractual relationship.
Islami Banking system: Gives special importance on savings. The objectives

and principles of the savings policy are:
To encourage people to save for self and for the country as a whole.
To develop a sustained savings habit among the people.
To mobilize deposits through the operation of the following accounts:

1. Al-Wadeeah Current Account
2. Mudaraba Savings Account
3. Mudaraba Term Deposit
4. Mudaraba Special Notice Account
5. Mudaraba Hajj Saving Scheme
6. Mudaraba Savings Bond Scheme
7. Mudaraba Foreign Currency Deposit (Savings) Scheme
8. Mudaraba Monthly Profit Deposit Scheme
To operate Current Account on Al-Wadeeah principle and all other deposit
accounts on Mudaraba principle of Islamic Shariah.
2. Cash Section:
Cash is the lifeblood of all financial activities. Cash section is a very sensitive
point of the branch. This section deals with all types of negotiable instruments
and it includes vault, used as the store of cash, instruments. Operation of this
section begins when the banking hour starts. Cash officer begins his transaction
with taking money from the vault, known as the opening cash balance. Vault is
kept in a more secured place. The amount of opening cash balance is entered
into a register. After whole days’ transaction, the surplus money remains in the
cash counter is put back in the vault and known as the closing balance. Main
branch. The main functions of this section are –
Cash Receipt
Cash Payment
2. Clearing sector:
According to the Article 37(2) of Bangladesh Bank Order, 1972, the banks
which are a member of the clearing house are called as Scheduled Banks. The
scheduled banks clear the cheques drawn upon one another through the clearing
house. This is an arrangement by the central bank where every day the
representative of the member banks sits to clear the cheques. For clearing there
is a department in every Bank. This department receives cheques, drafts and like
instruments from its customers for the purpose of collection with a deposit slip
over the counter crediting their accounts. Clearing of cheque is done through the
clearing house in Bangladesh Bank.
3. Remittance Section:
Cash remitting from one place to another is risky. So, Banks remit funds on
behalf of the customer(s) to save them from any awkward happening through
network of their branches. There are three modes of remitting funds. These are
–
Pay Order (PO)
Demand Draft (DD)
Telegraphic Transfer (TT)

4. Accounts Section:
This is obviously an independent and unique department, which works as the

composition of all the departments of the branch, but it is under the in charge of
the general banking in this branch.
Accounts department maintains all records of transactions and all types of

statement. At the end of transaction hour all concerned section sends vouchers
of transactions to this department. Accounts department compares all figures/
amount, contents of transactions with supplementary statement prepared by
computer. If any discrepancy arises regarding any transaction then this
department reports to the concerned department. Following are the activities of
accounts department:
To record all transaction in the cash book.
To prepare daily, weekly, monthly, half-yearly and yearly fund position.
To prepare all kinds of statements related to Bangladesh Bank, Head office

and National Board of Revenue (NBR).
To prepare monthly salary statement, provident fund statement and

administrative expenditure statement.
To make charges for different types of duty.
Statements Prepared by JBL:

1) Weekly fund position (CRR-4% and SLR-16%)
2) Monthly sector corporation
3) Monthly Schedule Bank Statements-1 (SBS-1)
4) Quarterly Schedule Bank Statements-2 (SBS-2)
5) Quarterly statement of exchange of torn/ dirty notes
6) Half-yearly Schedule Bank Statements-3 (SBS-3)
7) Half-yearly deposit insurance pension scheme.
Functions of Bangladesh Bank.
Introduction: After the liberation war and independence of Bangladesh the
government of Bangladesh reorganized the Dhaka branch of the State Bank of
Pakistan as the central bank of the country and named it Bangladesh Bank.
Location: Bangladesh Bank headquarter is in Motijheel. The bank has nine

physical branches in Bangladesh, in Motijheel, Sadarghat, Barishal, Khulna,
Sylhet, Bogra, Rajshahi, Rangpur and Chittagong.
Functions of Bangladesh Bank are:-
Supervision of the Banking System

Central Bank is the leader of all banks in Bangladesh. It supervises the banking
system of the country. Why not Central may be responsible for banking system.
They collect information from commercial bank and take necessary decision by
two ways- a) bank examine and b) bank regulation.
When a bank takes decision for customer or others, Central Bank examines it
and gives permission for implement or eliminates the project. Central Bank also
make project for customer and advice to implement in other Banks.
Monetary Policy
Monetary policy is a set of rules that aims at regulating the supply of money in
accordance with predetermined goals or objectives. Monetary policy plays a
very dominant role in altering the economic activity and the price level in a
country. So, it should be very carefully formulated and implemented in
achieving the goals and objectives as outlined in the Bangladesh Bank Order,
1972 below: (1) Price stability both internal and external; (2) Sustainable
growth and development; (3) High employment; (4) Economic and efficient use
of resources; (5) Stability of financial and payment system.
Core Function
Core functions BB as the central bank of Bangladesh executes all the functions
that a central bank traditionally performs as elsewhere in the world. The core
functions of BB are briefly discussed as follows: (1) BB formulates and
implements monetary policy aiming at stabilising domestic monetary value and
maintaining competitive external per value of taka for fostering growth and
development of country's productive resources in the best national interest; (2)
BB formulates and implements intervention policies in the domestic money
market and foreign exchange market.
Exchange rate policy

Exchange rate policy towards liberalisation of foreign exchange transactions, a
number of measures were adopted since 1990s. Bangladeshi currency, the taka,
was declared convertible on current account transactions (as on 24 March
1994), in terms of Article VIII of IMF Article of Agreement (1994). As Taka is
not convertible in capital account, resident owned capital is not freely
transferable abroad. Bangladesh adopted Floating Exchange Rate regime since
31 May 2003. Under the regime, BB does not interfere in the determination of
exchange rate, but operates the monetary policy prudently for minimising
extreme swings in exchange rate to avoid adverse repercussion on the domestic
economy. In the forex market banks are free to buy and sale foreign currency in
the spot and also in the forward markets.
Reserve management strategy

BB maintains its foreign exchange reserve in different currencies to minimize
the risk emerging from widespread fluctuation in exchange rate of major
currencies and very irregular movement in interest rates in the global money
market. BB has established Nostro account arrangements with different Central
Banks. Funds accumulated in these accounts are invested in Treasury bills,
repos and other government papers in the respective currencies. It also makes
investment in the form of short-term deposits with different high rated and
reputed commercial banks and purchase of high rated
sovereign/supranational/corporate bonds.
Deposit and insurance

The Deposit Insurance Scheme (DIS) was introduced in Bangladesh in August
1984 to act as a safety net for the depositors aiming at minimising the risks of
loss of depositors' fund with banks in which all the commercial banks including
foreign banks and the specialised banks operating in Bangladesh are the
member of this scheme by compulsion as provided under Article of Bank
Deposit Insurance Act 2000.
Research and publication

Bangladesh Bank brings out a number of research and statistical publications.
Among others, major publications include the Annual Report, the Monetary
Policy Review, the Financial Sector Review, the Bangladesh Bank Quarterly
Report, and Monthly Report- Major Economic Indicators, Monthly Economic
Trends intended to inform policy makers, market participants and general
public. Research, Policy Analysis Unit, IT, Monetary Policy and Statistics
Departments jointly prepare these reports, with support from the department of
Printing and Publications. And the Information and Public Relations Division
(IPRD) of Governor Secretariat, helps handling media briefings and liaison, and
issuance of press releases, etc. BB's websites (www.bangladesh-bank.org and
www.bangladeshbank.org.bd) now serve as important communication
platforms, allowing continuous instant access to information on roles,
responsibilities and policy approaches of the central bank. The websites contain
circulars issued by the BB, economic indicators, BB's publications and reports
including important speeches/presentations by the Governor.
Economic growth
BB's one of the key objectives is to promote and maintain a high level of
production, employment and real income of Bangladesh; and to foster growth
and development of the country's productive resources for national interests.
Therefore, BB as the regulator of country's financial system performs its
responsibilities with the view to achieve its objectives that impacts directly and
indirectly on country's financial growth, in particular, monetary, fiscal, and
economic growth
An Entrepreneurs life
Dr. Sabur Khan

Chairman of Daffodil International University.
A serial entrepreneur, Dr. Md. Sabur Khan, Chairman of Daffodil International

University (DIU) and, Daffodil Education Network (DEN) started his business
career in 1990 by an IT startup, naming Daffodil Computers Ltd., the 1st and
one of the leading public listed IT companies in Bangladesh. He has involved
himself with lot of challenges while he was the President of Dhaka Chamber of
Commerce and Industry (DCCI), the Bangladesh Computer Samity (BCS) and
the Member of Prime Minister’s ICT Task Force of the country. Bangladesh
government has awarded Dr. Md Sabur Khan, with the status of 'Commercially
Important Person’ (CIP) for his role.
His commitment has attached him as Visiting Professor with a lot of foreign
universities. He has been awarded Honorary Professorship, Honorary Doctorate,
and Honorary D. Litt from several foreign institutions. He has been conferred
with Honorary Fellowship from Said Business School, Oxford University by
ABRM for his contribution.
Dr. Md. Sabur Khan has been elected as the Second Vice President of
Association of Universities of Asia and the Pacific (AUAP). World Business
Angels Investment Forum (WBAF), the largest Angel investor’s forum
designated him as the High-Commissioner of WBAF for Bangladesh. Dr. Md.
Sabur Khan is the Chairman, Global Trade Committee and also Director of
World IT & Services Alliances (WITSA).
Dr. Khan initiated a challenging project to create 2000 new entrepreneurs,

written & published several books in two languages, and initiated business
incubator, startup, venture capital, Department of Entrepreneurship in the
university level to promote entrepreneurship.
Dr. Khan has achieved many awards nationally, and internationally.
He established ‘Daffodil Foundation’ & Daffodil Institute of Social Sciences

(DISS) for the well-being of underprivileged people.

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General banking activities of banking system in

Accounts Opening Section.

1. Account Opening Section:

Islami Banking system: Gives special importance on savings. The objectives

To develop a sustained savings habit among the people.

To mobilize deposits through the operation of the following accounts:

Pay Order (PO)

Demand Draft (DD)

Telegraphic Transfer (TT)

This is obviously an independent and unique department, which works as the

Accounts department maintains all records of transactions and all types of

To record all transaction in the cash book.

To prepare daily, weekly, monthly, half-yearly and yearly fund position.

To prepare all kinds of statements related to Bangladesh Bank, Head office

To prepare monthly salary statement, provident fund statement and

To make charges for different types of duty.

Statements Prepared by JBL:

Location: Bangladesh Bank headquarter is in Motijheel. The bank has nine

Functions of Bangladesh Bank are:-

Supervision of the Banking System

Exchange rate policy

Reserve management strategy

Deposit and insurance

Research and publication

Dr. Sabur Khan

A serial entrepreneur, Dr. Md. Sabur Khan, Chairman of Daffodil International

Dr. Khan initiated a challenging project to create 2000 new entrepreneurs,

He established ‘Daffodil Foundation’ & Daffodil Institute of Social Sciences

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