CREDIT AND CUSTOMER SERVICE DEPARTMENT

OF AGRICULTURAL DEVELOPMENT BANK LIMITED

MAINBRANCH PRITHIVICHOWK POKHARA

By:
Bhawana Subedi
Exam Roll No: 16871/15
T.U. Reg. No: 7-2-297-104-2015

An Internship Report

Submitted to:
Janapriya Multiple Campus
Faculty of Management,
Tribhuvan University

In Partial Fulfillment of the Requirement of the Degree of Bachelor of

Business Administration (BBA)

Pokhara
November, 2019
 DECLARATION

I hereby declare that the internship report entitled “Credit and Customer Service
Department of Agricultural Bank Limited, Main Branch Pokhara” under the
guidance of “Mr. Nabin Bahadur Adhikari” in partial fulfillment of the requirements
for the degree of Bachelor of Business Administration, submitted to Janapriya
Multiple Campus, Faculty of Management, Tribhuvan University, is my original work
and I have not submitted it earlier elsewhere.

November, 2019
...............………
Bhawana Subedi

ii
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 ACKNOWLEDGEMENT

It is difficult to draw up a list of persons to be thanked because several people have

helped in preparation of this report in diverse ways. Knowledge itself is cumulative
so, it is difficult to acknowledge intellectual ideas. It is impossible to acknowledge all
those who contributed to this study. But some persons need to be publicly
acknowledged.

I am grateful to Tribhuvan University for initiating the internship program as the

partial fulfillment of Bachelor of Business Administration that gives one the practical
experience of real working environment and the application of the theoretical
knowledge in the real work life. I am grateful to Mr. Nabin Bahadur Adhikari
supervisor of this internship report who provided me this opportunity, guided and
supported in every step of my report preparation.

It was wonderful experience to do internship in Agriculture Development Bank Ltd. I

would like to express my further gratitude to the branch manager of Agriculture
Development Bank Ltd, main branch Mr. Raghunath Neupane for letting me to
complete the internship for 8 weeks. Special thanks to Mr. Janak Baruwal sir and
Rajendra Subedi sir. I would also like to thank all the staffs of the organization from
different departments for being so kind and co-operative towards me during my
internship period and give support to learn much about the working area.Finally, I
would like to present my sincere thanks to my family members and my friends for
their co-operation, inspiration, guidance and support during all stages of the
preparation of this report. Thanks all for your support and warm co-operation.

Also I am pleased with our BBA program coordinator Mr. Mekh Raj Poudel and
internship report supervisor Mr Nabin Bahadur Adhikari, my teachers and whole
JMC family for mutual aid and assistance to complete this work.

November, 2019
Bhawana Subedi
JMC, Pokhara

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 TABLE OF CONTENTS

Title Page i
Declaration ii
Recommendation Letter of JMC iii
Recommendation Letter of ADBL iv
Acknowledgement v
Table of Contents vi
List of Tables viii
List of Figures ix
List of Abbreviations / Acronym x
Page
Chapter I: Introduction 1-5
1.1 Background of the Study 1
1.2 Objectives of the Study 2
1.3 Methodology of the study 2
1.4 Significance of the Study 4
1.5 Limitation of the Study 4
1.6 Organization of the Report 5
Chapter II: Introduction of the Industry 6-10
2.1 Meaning and Nature of Bank 6
2.2 Origin of Bank 7
2.3 Origin of Banks in Nepal 8
2.4 Nepalese Financial System 9
2.5 Commercial Banks in Nepal 9
2.6 Functions of Commercial Bank 10
Chapter III: Introduction of the Organization 11-19
3.1 Introduction about ADBL 11
3.2 Share Ownership 13
3.3 Board of Directors 14
3.4 Management Team 14
3.5 Organizational Structure of Pokhara Branch 14
3.6 Departments and their Functions 14

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 3.7 Product and Services 18
3.8 SWOT Analysis of ADBL 19
Chapter IV: Activities Done and Problem Solved 21-28
4.1 Introduction of Customer Service Department 21
4.2 Problem Solved During Internship on CSD 27
4.3 Introduction of Credit Department 27
4.4 Activities done during Internship 28
Chapter V: Summary and Conclusions 30-31
5.1 Summary 30
5.2 Conclusions 30
5.3 Lesson Learnt 31

Bibliography
Annexures

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 LIST OF TABLES

Table Page
1.1 Placement during Internship 4
2.1 List of Financial Institution in Nepal 9
3.3 Bank Guarantee Charges 17
3.4 Accounts and their interest rates 18
4.1 Activities Done During Internship 29

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 LIST OF FIGURES

Figure Page
3.1 Customer Service Department and its Function 15
3.2 Cash Department and its Function 16

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 ABBREVIATIONS/ ACRONYMS

ADBL Agricultural Development Bank Limited

CSD Costumers Service Department
BBA Bachelor of Business Administration
ECC Electronic Check Clearance
KYC Know Your Customer
NRB Nepal Rastra Bank
A/c Account
CEO Chief Executive Officer
DGM Deputy General Manager
SWIFT Society for Worldwide Interbank Financial Telecommunication
Rs. Rupees
JMC Janapriya Multiple Campus
NRs Nepali Rupees
FY Fiscal Year
IPO Initial Public Offering
ATM Automated Teller Machine
ROs Regional Offices

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 CHAPTER I
INTRODUCTION

1.1 Background of Study

An internship report of ADBL (Prithivi chowk Main Branch) Pokhara has been
performed and prepared for the partial fulfillment for requirement of the Degree of
Bachelor of Business Administration under faculty of management of Tribhuvan
University.

During the internship period, an individual learn what type of tasks are conducted,
how the problems are solved, how the decisions are made by analyzing different
alternatives, behavioral aspects like how to interact with other staffs working in an
organization and others outside the organizations as well the visitors visiting the
organizations.

Customer Service Department is one of the important departments of the bank.

Customers are first encounter with Customer Service Department when they enter
into bank. The personnel in the CSD should be cheerful, friendly and must be able to
handle each and every type of queries of customer. Probably, there is a saying “First
impression is the Last impression”. If the personnel in the CSD does not respond the
customer positively then it will create negative impact towards the organization.

Internship helps to eliminate the differences between theoretical knowledge and

practical knowledge. Internship not only makes the student well known about the job,
it also builds the managerial traits on the students. Internship also plays a vital role in
boosting the confidence level of students.

This internship helped internee to utilize the theoretical knowledge acquired in real
field while working as an internee in ADBL.

1.2 Objectives of the Study

The major objective of this internship program was to gain practical exposure of real
life work environment. Its aim was to accumulate learning as well as working
experience. The main objective of report, therefore is to explain the major facts
learnt during the internship period. At the same time it intends to highlight the
problems and provide recommendations for solving the problems faced by interns as
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well as the concerned departments’ staffs of the bank. The basic objective of the
study is to examine the CSD and Credit department. The study also focuses in
gaining knowledge related to the banking activities along with CSD and also to
fulfill the partial requirement of BBA program.

 To study the working procedure carried out by the credit and customer
service department of ADBL.
 To identify the various activities done under the CSD and Credit
department.
 To study the customer relationship management activities undertaken
at CSD of ADBL.

1.3 Methodology of the Study

This report is based mainly on observation of intern during the internship period. The
study is based on both primary and secondary data collection methods. The required
information for the study was taken mainly from the personal interview i.e. formal
and informal, website of ADBL, Annual reports and other published sources. Most of
the data required for this report were collected from the annual report of ADBL. Apart
from this, helpful information was collected from online sources.

1.3.1 Nature and Sources of Data

This report work is based on primary as well as secondary data and the nature of the
data is quantitative. Information required to prepare this report is collected from
primary and secondary sources.

I. Primary Sources

Primary source are the first hand source of gathering information. They are collected
in the work place. Methodology under primary source consists of:

 Discussion with officials of ADBL.

 Face to Face interaction with customer.
 Observation during the internship

II. Secondary Sources

Secondary sources are the second hand source of gathering information. Secondary
source of collecting information consists of:
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  Annual Report of ADBL
 Brochure, books and published articles of the bank
 Bank’s website pokharabanking@adbl.gov.np
 Internship Report of previous year students

1.3.2 Selection of the Organization

Selection of organization for internship program is always a crucial task. Being a

student of BBA, internee had to select a financial institution which could help to
broaden the knowledge about the banking, business and financial sectors. So internee
decided to choose ADBL for the internship. Internee thought that it would give an
opportunity to realize theoretical knowledge into practical field.

In order to approach, the requirements were the recommendation letter from the
college and curriculum vitae. After screening CV by the ADBL, Internee was selected
and placed in prithivi chowk branch from 23 Jestha 2076.

1.3.3 Duration

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 23 Jesth 2076 and ended in 10 th Sharwan 2076. During this
period, the internee came to learn about the working environment, working procedure
and culture of the organization. Internee’s working time was from10:00 AM to 5:00
PM except Friday. On Friday it was from 10:00 AM to 2:00 PM

1.3.4 Activities Performed

The activities internee did during the internship period are highlighted in the table:

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 Table: 1.1
Placement During Internship
Working Period First Second Third Fourth Fifth Sixth Seventh Eight
(Weeks) Week Week Week Week Week Week Week Week
Departments

Customer Service

Credit

Bank Guarantee

Administration

1.4 Significance of the Study

There are some significances of the study which are pointed as:

 Helps to know about the activities performed and product offered by the
bank.

 Helps to get knowledge about what sort of technologies are being used by the
bank.

 Helps to study about the customer behavior and how to deal with them.

 Helps to gain practical knowledge about the entire banking activities

1.5 Limitations of the Study

Since the internship period comprise only of eight weeks the information gather may
alter thereafter. There were some restrictions to study the entire process as per bank’s
rule for interns.

 Period was limited to only eight weeks. Therefore, it is not possible to have in
depth study of all the activities of all departments.

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  The bank’s policy of confidentiality in some matters prevented from analyzing
the various critical facts and issues.

 Rates and charges vary time to time. The rates included here are applicable
during the internship period.

 Since the internship is conducted in a single organization, cross-sectional

analysis and comparative study of different organizations of the industry is not
possible.

1.6 Organization of Study

The report entitled “Customer Service of Agricultural Development Bank Limited” is

prepared in the form of partial fulfillment of the requirement of BBA. This report is
organized as following:

 CHAPTER I : General Background

 CHAPTER II : Introduction of Industry
 CHAPTER III : Introduction of Organization
 CHAPTER IV : Activities performed under Customer Service Department
 CHAPTER V : Summary, Conclusion and Lesson Learned

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 CHAPTER II
INTRODUCTION OF THE INDUSTRY

2.1 Meaning and Nature of Bank

The word “Bank” has been derived from the Italian Banca which means a place for
keeping, lending and exchanging money. The bank is a financial institution, which
deals with money. It accepts deposits from individuals and organization that have
surplus fund and grants loans to deficit units of economic system. It allows interest on
the deposits and charges interest on the loans granted. Since it accepts deposits and
grants loans, it is regarded as the trader of money. It creates credit and supports for the
formation of capital and hence it is regarded as manufacturer of money (Sing, 2009).

Simply, a bank is an institution which deals with the money and credit. Nowadays, the
transaction in financial market heavily depends upon the banking system of the
country. Without the bank it would be impossible for the industrialists and
entrepreneurs to go directly to general public for getting their savings for investments.
So bank is very important for all aspects.

Nepal Rastra Act (2002) stated that a bank is a financial institution, which provides
financial services that may be in the form of accepting deposits, advancing loan,
providing necessary technical advices, dealing over foreign currencies, remitting
funds, etc.

Commercial Bank act of Nepal(2031) stated that a bank is an organization established

for the purpose of exchange money, deposits, lending money and participation
transactions.

From definitions, bank is an institution which accepts deposits from the public and
provides advance and loan to business and personal customers. The difference in
interest rate on lending and deposit, i.e. interest rate spread, is the major source of
income for the bank. Interest on lending is higher than the deposits. Bank may be
called the financial supermarket providing all kind of monetary service, which is
necessary for the industrialization and economic development of country. In present
days, industrial bank, commercial bank, agriculture bank, joint stock bank,

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cooperative bank, rural development bank and development bank. (Kandel and
Khatiwada, 2072)

Services Typically Offered by Banks

The type of services offered by a bank depends upon the type of the bank and the
country. Services usually provide by the bank include:

 Taking the deposits of the general public and keeping it safe in their
respective accounts. There are different types of accounts like savings
account, current account, etc. where the general public can keep their
deposits.

 Making loans to individuals and businesses

 Cashing cheques

 Facilitating money transactions such as wire transfers and cashier’s checks

 Issuing credit cards, ATM, and Debit Cards

 Storing valuables, particularly in a safe deposit box.

2.2 Origin of Bank

The history of banking is nearly as old as civilization. In the ancient Rome and
Greece, the practice of storing precious metals and coins at safe places and loaning
out money for public and private purpose on interest was prevalent. In England,
banking had its origin with the London goldsmith who in the 17 th century began to
accept deposits from merchants and others for safe keeping of money and other
valuables. As public enterprise, banking made its first appearance in Italy in 1157 A.D
when the “Bank of Venice” was founded (Singh, 2007).

Linguistic (the science of language) and etymology (the study of the origin of words)
suggest an interesting story about the origin of word “Bank “. Both the old French
word Banque and the Italian word Banca were used centuries ago to mean a “Bench”
or “Money changer’s table”. Banks are among the most important financial
institutions whose principle operation are concerned with accumulation of the
temporarily idle money with the general public for the purpose of advancing it to
others for expenditure. Thus, the word banking has been used to denote a certain kind

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of trading in money. A bank is therefore a corporation that deals in credit i.e. accepts
deposits from public, withdrawing by cheques and advances loans of various sorts.

The modern economic system cannot function without bank. According to the modern
concept, banking is a business that not only deals with borrowings, lending and
remittance of funds, but it is also important instruments for fostering economic
growth. Presently there are various types of banks established for instance, industrial
bank, commercial bank, agriculture bank, joint stock bank, cooperative bank, and
development bank with different purpose. (Source:Kande and Khatiwada,2072)

2.3 Origin of Bank in Nepal

The history of banking in Nepal can be traced back to 1877 A.D. when TejarathAdda
was established by the government to provide credit facilities to general public. These
unorganized institutions although quite underdeveloped could still mobilized fund
from wide range of different sources. Although the TejarathAdda was established, it
was not able to facilitate the growing trades with Tibet and India. Thus, a need for the
establishment of a modern bank had become essential to promote the trade of the
nation. In the year 1923, “Treaty of Peace and Friendship” were concluded between
the government of Britain and Government of Nepal. As per the treaty, Nepal could
carry on important trade free of duty via India.

Bhattarai (2013) stated that Nepal was going to diversify its foreign trade and for that
the country needed a modern bank but it could not until the UdhyogParishad
(Industrial Development Board) was set up with the following objectives:-

To promote and protect the trade, commerce, industries and manufacturer of Nepal,
and to consider and discuss questions connected with or affecting such trade,
commerce, industries and manufacturers, to register and incorporate joint stock
companies in conformity with Nepal Companies Act and also to examine and
supervise their workings and to assist and advise Government of Nepal in economic
and financial matters.

Before 1956 SadarMulukikhanaAdda(local treasury of the government) issued

currency notes and the foreign exchange reserves of Nepal were maintained by
Reserve bank of India. During that period the Indian currency along with Nepalese
currency was circulating in the economy. Thus, to manage the circulation of national
8
currency and to maintain exchange rate stability, there was an urgent need for the
establishment of central bank. In 1956, the Nepal Rastriya Act was formulated, and
Nepal Rastra Bank was established as a Central Bank on April 26, 1956. It took over
the functions of MulikikhanaAdda “Government Treasury” and started issuing
currency in 1956; and also thus relieved the various Mal Addas (Revenues Offices) of
their work. Thus, it helped the government to perform treasury functions and stabilize
the exchange rate (Avadhani, 2016).

In mid-1980s, three foreign commercial banks opened branches in Nepal. The Nepal
Arab Bank was co-owned by the Emirates Bank International Limited (Dubai), the
Nepalese government, and the Nepalese public. The Nepal Indosuez Bank was jointly
owned by the French Bank Indosuez, Rastriya Banijya Bank, Rastriya Beema
Sansthan (National Insurance Corporation), and Nepalese public. Nepal Grindlays
Bank was co-owned by a British firm called Grindlays Bank, local financial interests,
and the Nepalese public. (Kandel and Khatiwada,2072)

2.4 Nepalese Financial System

The financial system of Nepal consists of:
Table: 2.1
List of Financial Institution in Nepal
Organization Class Number of Institutions
Central Bank - 1

Commercial Bank A 28

Development Bank B 33

Finance Companies C 25

Micro Credit Development Banks D 65

(https://www.nrb.org.np/bfr/bfi_list/List of BFIs_July2018.pdf )

2.5 Commercial Banking System in Nepal

The commercial bank is the oldest form of bank. In general, bank that performs all
kinds of banking business and generally finances trade and commerce is called
commercial bank. It occupies quite an important place in the framework of every
economy. Commercial banks acquire funds from one group of surplus spending units
and making these funds available to other deficit units facilitating the effective

9
mobilization of resources, which in turn leads to sound economic growth of the
country. Commercial banks represent the largest group of financial institution
measured by asset size. The main aim of a commercial bank is to earn profit like any
other business entity. It lends a certain percentage of the cash lying in deposits on
higher interest rate than it pays on such deposits. The difference of interest on
deposits received and loans advanced are the main source of its income. Thus
commercial banks are merely a business firm engaged in financial intermediation as
well as perform additional functions under strict supervision and control of the central
bank (Peter, 1999).

In the context of Nepal, Nepal Bank limited is the first commercial bank of Nepal. It
was established in 1994 B.S. The second commercial bank is Rastriya Banjiya Bank.
It was established in 2022 B.S.

Nepal has opened its door to foreign commercial banks in the kingdom almost a
decade back. As the country followed economic liberalization, there was massive
entrance of foreign banks in Nepal. Consequently, Nepal Arab Bank was established
in 1985 A.D. Similarly, the Nepal Indosuez Bank was established as a joint venture
between Nepal and France in 1986 A.D. the legitimate entry of foreign commercial
banks with full-fledged banking. (Source: Kandel and Khatiwada,2072)

2.6 Functions of Commercial Banks

The functions of commercial banks are broader in scope, size and magnitudes.
Commercial banks are one of the major financial intermediaries whose primary
function is the transfer of monetary resources from the savers to the users. The
transfer is made at certain process and conditions governed by the broad policy
parameters stipulated by the central bank authorities. The spread between the prices
received by the bank on the funds lend and the price paid by them on the funds
mobilized is one of the crucial factors which determine the viability of banking
operations.

Its major functions are as follow:

 Accepting of deposits
 Granting loans
 Remittance or transfer of money

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 Exchanging of money
 Issue of credit instruments
 Government’s and Nepal Rastra Bank’s Agent
 Agency service functions
 Encouragement to trade

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 CHAPTER III
INTRODUCTION OF THE ORGANIZATION

3.1 Introduction of Agricultural Development Bank Limited

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 Corporative 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 a more than 67 percent
of institutional credit supply in the country. Hence, rural finance is the principal
operational area of ADBL. Furthermore, the bank has also been involved in
commercial banking operations since 1984.

The enactment of Bank and Financial Institution Act (BAFIA) abolished all Acts
related to financial institutions including the ADBN Act, 1967. In line with the
BAFIA, ADBL has been incorporated as a public limited company on July 14, 2005.
Thus, ADBL operates as a “A” category financial institution under the legal
framework of BAFIA and the Company Act, 2053. Agricultural Development Bank
Limited, has access to the correspondent network for fund/remittance transfer,
commercial payment, foreign exchange/money markets, letter of credit or any
banking business anywhere in the globe.( http://www.adbl.gov.np/brief_profile.html)

3.1.1 Organization’s Vision, Mission and Objectives

Vision
 To be a Mass- based Complete Bank serving from Urban to Rural

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Mission

 To deliver comprehensive banking solution strengthening its extensive

network

Objectives

 To provide quality banking services

 To adopt market driven strategy
 To obtain sustained and competitive return on investment

Corporate Conduct
In achieving its corporate objective in pursuit of its corporate mission and vision,
ADBL will:

 Comply with all relevant legislation, code of conduct and standards of good
corporate citizenship in Nepal while maintaining full autonomy in the
management of its operations;
 Conduct its operations in an open and transparent manner;
 Put local resources to work for local development, serving the rural
community and its aspirations;
 Provide a full and balanced range of financial products and services that
satisfies the needs of the rural population of Nepal, on a profitable and
sustainable basis;
 Strive consistently to provide improved products and services to its clients at
reasonable cost, using modern banking, information and communication
technology in the most appropriate form to its client needs;
 Be vigorous in building reputation for professionalism, competitive pricing,
reliability and quality of service innovation;
 Operate in accordance with best banking practice, acting with financial
prudence and keeping in mind the need to balance profitability with asset
preservation and liquidity and to safeguard depositor’s funds;
 Work together with its employees to develop their capabilities to contribute to
achievement of the bank’s objectives, promoting excellence, rewarding
achievement and providing them the opportunity to share in the bank’s
success;

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  Develop mutually acceptable relationship with government in the pursuit of
improvement in living standards in rural areas, while respecting best financial
practices;
 Ensure that its activities contribute to the environmental stability and overall
improvement of living standards in Nepal; and
 Judge the bank’s success against the measures that include profitability,
portfolio quality in terms of minimal arrears and non-performing loans,
portfolio worth, total deposits, geographic outreach and public image.
(http://www.adbl.gov.np/corporate_vision_mission.html)
3.2 Share Ownership
The share ownership in Agricultural Development Bank (ADB) is 51 %government
owned and 49% public owned, and the largest commercial bank in Nepal.

3.3 Board of Directors

The Board of Directors is the apex body of the bank. It formulates policies as well as
strategies and provides guidance to the management. The Board comprises a total of
nine members; four members representing Government of Nepal and four members
representing individual shareholders. Besides, one member is nominated by the Board
as per the BAFIA. The Board is supported by Audit Committee and Governance Sub-
Committee in the area of internal control and good governance respectively.

The day to day operation of the bank is executed by the Chief Executive Officer. The
Chief Executive Officer is closely assisted by four Deputy General Managers and 18
Division Chiefs. Moreover, Chief Executive Officer is supported by Assets and
Liabilities Management and Sub-Committee for various activities related to risk
management.

The bank has three-tier organization structure consisting of Head Office, Regional
Office (ROs) and field offices. Field offices are further categorized into three levels;
main branch, branch and sub-branch depending particularly upon their volume of
business. The head office is the policy making body at the top, field offices are

implementing units at the bottom and ROs with monitoring and supervisory role are
in between.

ADBL is also operating a Central Training Institute (CTI) at corporate level in Bode,
Bhaktapur under Head Office Structure and five Regional Training Centres (RTCs)
14
with residential facilities in five development regions. The CTI and RTCs conducts
training and seminars particularly for enhancing abilities and skills of organizational
members. (Annexure I) (http://www.adbl.gov.np/board_of_director.html)

3.4 Management Team

The ADBL management team comprises of experienced professionals with years of

experiences in different commercial bank and another financial sector of Nepal. The
Management team of the bank is committed towards the up liftmen of bank in the
height of success through customer satisfaction.

3.5 Organizational Structure of ADBL, Prthivichowk Branch

ADBL, Prithivichowk Branch has got flat organizational structure, which enable day-
to-day operation and decision making easy. To delegate the authority and
responsibility among the employees, the bank has developed the Organizational
Structure (See Annex II).

3.6 Departments and their Functions

There are basically three major departments in ADBL, Pokhara, i.e. Operation
department, Account section and Credit Department. Within operation department, it
has its customer service, remittance, clearing and cash department. Each department
has its own functions. The concerned department performs their duties and
responsibilities regarding the function of their departments.

3.6.1 Customer Service Department (CSD)

CSD is one of the important departments of the organization. The entire customer’s
related tasks are done in CSD like various account opening, providing correct
information about bank’s products and services, counseling and motivating them to

utilize the services offered by the bank and satisfying their queries regarding bank and
its services. Another task of this department is to print cheques, balance statement,
clearing statement and transaction statement of respective teller. This department is
also a reception of the bank where the functions such as: handling telephone,
transferring calls, receiving and sending mails, forwarding and maintaining files and
documents are carried out. This department looks after the ATM also by filling the

15
form and maintaining the card registered. The following figure shows the structure of
CSD:

Figure: 3.1 Customer Service Department and its Functions

3.6.2 Teller/Cash Department

Cash Department is one of the most important and risky departments as the
transaction are directly associated with real cash. Hence, the teller must be very
careful and must have great presence of mind while handling transaction. In ADBL,
Pokhara both teller works at one time as the bank will be back. The tellers are
responsible for the cash deposit and payment. They make payment against cheques,
managers’ check, and other payable instrument by verifying the signature of the
concerned person. Cash Department has other functions like counting, sorting cash
properly and bundling cash deposits according to demonstrations and currency. The
structure of cash department is given below:

16
Figure: 3.2 Cash Department and their Function

3.6.3 Account Section:

This department includes the work related to share, management of accounts and
authorization of ECC cheques. Accountant handles all the accounts the branch in
quarterly basis. Administrator carries out the financing activities of the concerned
branch as well as work related to shares like managing bonus certificate including
dividend cheque provided at the year to the shareholders of the organization. In the
year 2014 bank had provided 30% dividend to their shareholders whereas 15%
dividend including bonus share was provided to shareholders in 2018.

3.6.4 Credit Department

This department is one of the major departments of ADBL since the main objective of
bank is concerned with this department. This department has the major function of
mobilizing the funds that is created by the deposits through lending it in different
sectors. This department provides credit/loan to the customers, after looking and
analyzing at various necessary documents concerned with the loan demander such as
collaterals for the security purpose, financial background, legal documents etc. to
know the customers feasibility. This department sets various interest rates according
to the types of loans provided as per the policy formulated for credit creation.

17
Different types of funded loans provided by ADBL are shown in following table:
 Auto Loan
 Foreign Employment Loan
 Home Loan
 Residential Loan
 Agricultural Production Loan
 Livestock Loan
 Small and Cottage Industry Loan
 Products and Inputs Marketing loan
This department also handles different types of Bank Guarantee which is shown in
following table as:
Table 3.3
Bank Guarantee Charges
Every 3month fee (%)
Types of customers
S.N Types of New New Customers Customer Minimu
Guarantee customers Guarantee from last as loyal m fee for
without using limit 6 months customers all
using limit customer
1. Bid 0.375 0.350 0.300 0.250 500
2. Performance
3. Advance 0.500 0.375 0.350 0.300 1000
Payment
(Source:ADBL)

3.7 Product and Service Offered by ADBL

i. Deposits:
Deposits are the funds collected by the bank from account holders for the
security and transaction motives. Deposit accounts are the important product
offered by ADBL. It offers different kinds of account with different interest
rates:

18
Table: 3.4

Accounts and their Interest rate

S.No Descriptions Interest Rate

1 Saving accounts:  
Karmachari Nibritibaran Bachat 6.50
Khata
General Saving 5.50
ChetenshilNari Saving 6.00
Krishi Saving 6.50
Shareholder Saving 6.00
Sambriddhi Saving 6.00
Ba Ama Saving 6.50
2 Current accounts 0.00
3 Fixed Deposit:  
3.1 Corporate:  
3 months 8.50
6 months 8.50
1 year 8.60
Above 1 year up to 5 years 8.60
3.2 Individual:  
3 months 8.25
6 months 8.50
1 year 9.00
Above 1 year and up to 2 years 8.75
ADBL special 9.25
(Source: http://adbl.gov.np/adbl_interest-rate.html)

ii. Loans and Advances

The principle reason banks are chartered by state and federal authority is to
make loans to their customers. Banks are expected to support their local
communities with an adequate supply of credit for all legitimate business and
consumer financial needs rates. ADBL provides various types of loans to its
clients.
iii. Clearing Services:
In today’s competitive world, the bank cannot sustain until it provides better
service, facilities to its valued customers. ADBL provides easy access to
customers by helping them to deposit their money to the concerned bank
where their account is through clearing proceeds on online mode.

19
 iv. Any Branch Banking System:
ADBL is providing ABBS service within the country to provide convenience
to the customers.
v. Online Banking:
It is a free service that allows customers to avail online banking transaction
wherever and whenever required. It includes balance query, check
transactions, send and receive messages and bank statement.

3.8 SWOT Analysis of ADBL

SWOT Analysis is used to evaluate the Strengths, Weaknesses, Opportunities and

Threats involved in a project or in a business venture. It involves specifying the
objective of the business venture or project and identifying the internal and external
factors that are favorable and unfavorable to achieving that objective. SWOT analysis
of ADBL reveals various strengths, weakness it needs to work on and the
opportunities and threats present in the environment that it has to focus on.

Strength Analysis

i. Strong goodwill, brand name and company image at national level.

ii. Increasing public interest and confidence to transact in government ownership
banks.
iii. Introduction of new technology such as ATM, Visa Card, Remit, ABBS,
internet banking.
iv. Experienced and competent employees.
v. Provides friendly environment to work.
vi. Suitable and central place.
vii. Wide geographic coverage with maximum branches all over the nation.
viii. Routine work schedule increasing efficiency.

Weakness Analysis
i. Lacks the adequate number of staffs that causes overload in the existing staffs
ii. Bank’s layout is not too catchy and seems messy during critical time
iii. Less promotional activities.

20
 iv. Lack of adequate resources (i.e. technical resources to perform task easier and
faster).
Opportunity Analysis
i. Improving socio-economic scenario of the local public.
ii. Rate of increasing consumer loan demands.
iii. Improving banking technology and services.
iv. Favorable customer attitude.
v. Opportunity for the expansion through e-commerce development.
Threat Analysis
i. Discouraging nation’s political scenario/political instability.
ii. Intense competition due to increasing number of banks and financial
institutions.
iii. Changes in the banking technology.
iv. Decrease of share price in the market.

21
 CHAPTER IV
ACTIVITIES DONE AND PROBLEM SOLVED

During the internship period Internee was placed in different department in

Agricultural Development Bank Limited which is presented below.

4.1 Introduction of Customer Service Department:

Customer Service Department is considered as the most important department in a

bank. This department is also called as help or information desk as customer’s first
contacts in this department for their queries. Therefore, the image and status of bank
depends upon the effective functioning of this department. CSD deals with customers;
answering their queries, marketing of various bank products, opening new account
and responding to telephone calls, providing information about money transfer,
providing balance certificate, issuing bank statement, accepting cheque book request,
developing and issuing cheque book as per customer request, closing existing account
and many more.

The image and reputation of the bank depends upon the effective functioning of this
department, customers should be handled efficiently as it is said “First impression is
the Last impression”. The personnel deployed at this department should present
him/her in such a way that customer feel they are highly precious and their value
immense for the organization which result in building good relationship. The
department is mainly responsible for assisting customers to explore the services being
offered by the bank, explaining the process of receiving services and providing
various customers services during and after the purchase of the services. Although
each and every department is involved in providing specific services to customers
according to the nature of work carried by them, however operation department is
involved in providing customers with the surface level assistance which is the basic
function of the department. The major objectives of CSD are disseminating
information, listening and handling customer’s grievances, building good customer
relationship.

22
 Objectives of the CSD

i. Build long term relationship with customer.

ii. Contacting potential customers to learn their banking needs and explain bank
services.
iii. Listening and handling customers' grievances and sincerely reply the customer
queries.
iv. Motivate customer to take bank and products.

4.1.2 Analysis of Activities Done Under Customer Service

Department

The internship period was of eight weeks. During this period, day-to-day activities of
CSD is assigned and performed. Good customer service is the heart of banking. The
goal of the customer service is not only to help the customer having good experience
but also to offer them an experience that exceed their expectation.

Major activities done in CSD:

 Open all types of accounts: Saving, Current, Fixed accounts.

 Assist customers to fill out the account opening form correctly and also obtain
all the necessary documents related to his/her identification including KYC
form as regulated by NRB.
 Answer the queries put by customers face to face as well as on the phone.
 Issuance of cheque book and handover to the customers after completion of
required documentation formalities.
 Remind customers to receive their cheque books.
 Maintain all kinds of account opening related registers and filling the account
opening related documents in proper way in proper place.
 Closing accounts
 Maintain confidentiality of the bank
4.1.2.1 Providing General Information

Consumer raises various queries regarding bank’s services offered to them and
procedure for obtaining those services. These queries are answered in the form of
information to the customers. Internee provide general information to the customer

23
about the services offered by bank such as type of accounts, interest rates, procedure
of account opening, etc.

4.1.2.2 Account Opening:

Banks offer various types of accounts to the customers. An account is opened by a

customer in a bank to keep the deposit safely and earned some interest from their
savings. These collected deposits are provided to deficit units of the economy at a
higher rate compared to interest paid on deposits. Opening an account is entering into
a contract with the bank. Only the party eligible for contracting according to law can
open an account.

Account Opening Procedure:

While opening a new account, at first customers are informed about different accounts
offered by the bank along with their characteristics. After they are ready to open an
account, application form is given to the customers to fill up their information. After
receiving and examining the related documents of the customer, account is opened by
the help of T-24 operating system.

Main documents required for opening account are:

 A customer should have a photocopy of citizenship/passport.

 Number of passport size photographs according to the account type.
 Electricity\water supply Bill of own house and owners in case of rented home.
Different type of accounts requires different documents:

A) Personal Account:

1. Single Account:

 Identification of account holder

 Proper introduction by existing account holder of the bank
 Nominee should be compulsorily mentioned
 Passport size Photographs of both account holder and nominee
(2-2copies each)
2. Joint Account:
 Identification of account holder
 Proper introduction by existing account holder of the bank

24
  Photographs of account holder (2 copies)
3. Minor Account:
 Birth certificate of minor
 Identification of minor’s guardian i.e. Citizenship certificate
 Photographs of account operator as well as minor’s (2 copies)

B) Private limited/Public limited Company:

 Name, address of account operators with copy of citizenship certificate

 Memorandum and Articles of Association
 Registration certificate
 Two recent photographs of account operators
 Income tax clearance certificate
 Audited financial statement in case of existing firm
C) Partnership Firm:

 Firm registration certificate

 Income Tax Certificate
 Passport/Citizenship Certificate of partners
 Two recent photographs of each partner
 Partnership agreement deed
D) Joint Venture Company:

 Company registration
 Income tax receipt
 Board resolution
 Memorandum and article of association
 Identification of account operator
 Joint venture agreement
 Photographs (2 copies)
4.1.3 Closing an Existing Account

To close an account, first the customers have to fill up the account closing form where
they have to mention account number, name of the account holder and the reason to
close the account. If the nominee came to claim against the account and request to
close the account, then they should present citizenship photocopy compulsorily. In

25
case of companies account they should present letter with stamp of the company in it
including signature of concerned party. After filling up the form, it is taken to the
authorized employee where he/she verifies the account holders name and signatures.
When the account is verified, it is closed as per the policy of the bank and bank does
not charge for account closer from customers.

4.1.4 Printing and Issuing Checks

Customers are provided check book according to the account type and rules and
regulations of the bank so that customer can withdrawal money as they needed.
Cheque book is provided to the customer as soon as account is opened by submitting
all required document to open an account with minimum balance in their account as
per bank rules.

For printing cheques, first customer must submit requisition slip in case of existing
customer and if existing customer loose the slip then they have to pay 200 rupee
penalty for new cheque issuance. New customers get their cheque after they complete
all the requirements of opening new account. The account number should be entered,
and the name of the holder should be verified. Then the starting and ending number of
the cheque should be checked and verified before printing. Binding and writing the
name, account number and date of issuance in the slip of new cheque and in the cover,
authorize signature with stamp of Agricultural Bank is mentioned on cheque. For
issuing cheque to the account holders, starting and ending number of cheques, issue
date, account holders name and account number is to be entered in the cheque
issuance register and after verification of the signature, the cheque is given to the
respective person or account holder.

4.1.5 Account Balance Statement:

The account statement is a statement that shows the details of the transactions done by
the customer like cash deposit, cash transfer, cash withdraws, interest paid by bank,
etc. Account statement is provided but only upon demand basis free of cost. Statement
request must be brought by corporate customer in letter head and for single customer
specific slip must be filling up in bank mentioning duration of statement request.
After recording name, account number and signature of authorized person on
statement register, signature is verified, and statement issued. Statement should be
collected by the account holders or person assigned by account holder.

26
4.1.6 Mentioning Customer Files:

Documents and files relating to customer are properly recorded for future purpose.
Account opening forms are filed properly with check list if required document is
complete and follow up the customer for missing documents. Customer files should
be mentioned properly so that it could be available whenever it is needed. Requisition
slip is filed along with identification of receiver after issuing cheque.

4.1.7 Responding to Phone Calls:

Responding to phone calls is one of the important activities in CSD. Numerous phone
calls are received by the bank in a day. So, it is the duty of the CSD employee to
respond to phone calls. Some phone calls are done by the customer to check their
balance or for the queries. Some phone calls may be for the employees in the bank so
it should be transferred to the relevant person.

4.1.8 Problems faced during internship on CSD

The problems that were faced by internee during the internship period of eight weeks
are:

 The CSD department is understaffed. Too much responsibility lies on the

single person who faces a lot of problems during high traffic hours at the
bank.

 The customers frequently complain about the slow performance of the

organization staff and their irregular presence in bank. Staffs take leave
frequently that affect in the reputation of the organization.

 There was lack of adequate follows up with customer regarding distribution

of bonus share and dividend.

 Frequent system crash was a major problem in ADB

4.2 Problem Solved During Internship on CSD:

The problems solved by internee during internship are:

27
  Internee work as a helping hand on CSD by receiving phone, filling up the
vouchers, opening accounts by helping customers in filling form, answering
the queries of customers at the traffic hours.
 Internee helped customers by providing their bonus share and dividend with
the help of shareholders number.
 Internee review all the cheque and voucher filled by customers and inform
customer if anything has been missing on cheque. The returned cheques from
the concerned organization were handed to customers by calling them.
 Internee record several type of guarantee while performing in credit
department in computer.

4.3 Introduction of Credit Department

This department is one of the major departments of ADBL since the main objective of
bank is concerned with this department. This department has the major function of
mobilizing the funds that is created by the deposits through lending it in different
sectors. This department provides credit/loan to the customers, after looking and
analyzing at various necessary documents concerned with the loan demander such as
collaterals for the security purpose, financial background, legal documents etc. to
know the customers feasibility. This department sets various interest rates according
to the types of loans provided as per the policy formulated for credit creation. Under
credit department different types of credit services or loan services are provided.
Under credit department I have done intern in Bank Guarantee department.

4.3.1 Introduction of Bank Guarantee Department

A bank guarantee is a written contract given by a bank on behalf of a customer. By

issuing this guarantee, a bank takes responsibility for payment of a sum of money in
case, if it is not paid by the customer on whose behalf the guarantee has been issued.
In return, a bank gets some commission for issuing the guarantee. A guarantee is a
written undertaking issued by a bank in favor of the receiver of the goods or services,
whereby it pledges to make certain payments on behalf of its client, if the latter fails
to make a payment or to carry out specific functions in terms of the commercial
contract.

28
4.3.2 Procedure for Bank Guarantees

 Contact your bank advisor or visit your nearest bank branch office, where you
will be provided with basic information, including the Guarantee Issuance
Instruction form.
 Along with the Guarantee Issuance Instruction form, you will need to submit
additional supporting documents to permit.
 Evaluating the economic risk of the client
 Issuing a guarantee (such as a contract for work, terms of reference
documents, etc.)
 A bank guarantee must be secured

4.4 Activities Done During internship

During the eight weeks internship period internee has wonderful time and has great
experiences at ADBL- Pokhara. Intern experienced about working exposure in real
world business scenario. The intern had a clear understanding about the Customer
Service Department where intern got the opportunity to gain the experience regarding
dealing and handling customer with their complaints in the confidence way. During
internship, internee had opened total 51 types of different account. Internee closed 3
accounts. The total number of cheques issued in eight weeks was 50 and statement
issued was 25 by internee. The total number of phone calls received was 13 in eight
weeks of internship. And internee also handles some work on Bank Guarantee
department. During internship, internee had prepared 75 bid bond, 50 performance
bond, 60 advance payment guarantee, 4 deposit guarantee, 100 guarantees has been
renewed and 6 credit line. The internee was confined by only clerical activities during
internship period due to privacy policy and short time frame of internship.

The activities done by an intern during internship period are presented below:

29
Table 4.1
Activities Done (From Jestha 23 to Srawan 10)
S.N Activities Done Frequency of Activities
1. Account Opened
i. Sabai Nepali Saving 44
Account
ii. Current Account 03
iii. Fixed Account 04

2. Account Closed 03
3. Cheque Issuance 50
4. Statement Issuance 25
5. Responding to phone calls 13
6 Bank Guarantee issuance
i. Bid bond (BB) 75
ii. Performance bond (PB) 50
iii. Advance Payments (APG) 60
iv. Deposit Guarantee (DG) 04
v. Renew of Guarantee 100
vi. Credit Line 06

30
 CHAPTER V
SUMMARY CONCLUSIONS AND LESSON LEARNT

This chapter includes the conclusion of report and the lesson we have learn from the
internship.
5.1 Summary

The internship at ADBL helps internee to know about real work practice in banking
sector. During the internship period, there was substantially large inflow of the
customers in the bank for using various product and services of ADBL. Through
which internee got chance of promoting product and services to customers. This
experience was very new to the intern but enjoyed it greatly. All the knowledge,
experience and skills gained will be extremely beneficial to internee’s future career in
the banking sector.

Initially, Chapter I describes the background, objectives, methodology, significance

and limitation of the study. Additionally, the entire organization of report is
mentioned. In short, it elaborates the various aspects of the study.

Secondly, introduction of industry where the internee has done internship has been
explained in Chapter II. Since internship was done in bank, meaning and origin of
bank along with the brief elaboration of commercial bank has been included.

Thirdly, organization that had appointed interns has been prefaced in Chapter III. The
abstract insertion of ADBL alone with capital as well as organizational structure,
management team and product and services.

Finally, Chapter IV comprises the keen aspects of study i.e. the activities performed
by internee in bank. Internee has carried well in various function of ECC. Here,
internee tends to illustrate the problem faced and problem one had solved.

5.2 Conclusion

ADBL being forward in banking technology and has been contributing in the
economic development of the country. It has been trying to provide value added
services to its customers and to add a milestone in Nepalese banking industry.

Internship plays an important role in matching the knowledge gained from theoretical
perspective of education with the practical exposure at workplace. It also provides an
31
opportunity to learn about the activities of the bank and its corporate culture. Within a
short span of time an internee like me learned so many things like dedication,
commitment to meet targets, interpersonal and communication skills etc, which will
certainly help in coming days.

ADBL is focused on serving the agricultural needs of the rural as well as urban
peoples by providing various financial products and services to uplift the agricultural
sector. To meet this objective, ADBL has been aggressively expanding its branches
throughout the nation. ADBL, Prithivi chowk, aims at maintaining cordial and
lifelong relationship with its customers through responsive customer service
department. The CSD is very much responsive to satisfy the financial needs of its
valued customer. It provides three types of core account services videlicet: saving
accounts, current accounts and fixed deposit account. The CSD of ADBL offers other
additional services like printing monthly account statements, printing check books,
and handling customer queries. The Bank guarantee department also provides
different services that it provides guarantee to the beneficiary on the behalf of
customers.

The customer service department of Agricultural Development Bank deals with the
customers which are the most valuable assets to the bank. ADBL is constantly
attempting to provide better or quality financial services to its valued customers by
providing unique, customized and personalized products. The main aim of CSD is to
provide comfortable and friendly environment to its customers that ultimately adds up
to its goodwill in the long run.

5.3 Lesson Learnt

Involving as an intern at ADBL was truly an amazing experience. During internship

intern got a great opportunity to learn about so many things that have practical
implication in internee career. The term of two-month internship, paved the way to
learn new and specific things about the institution. The learning and knowledge were
based away work was done and observed. During the internship at ADBL, many
aspects of banking services were understood. The process and functioning of
customer service department was understood.

 Internee learned about the opening a/c, opening fixed deposit, required
document to open different account.

32
 It was learnt that the behavioral issue is most important inside the
organization.
 As the customer service department is the first point of contact of the
financial institution, the person at the front desk should be able to handle
different queries of the customers.
 The way of dealing with different types of customer with heterogeneous
needs and desires.
 Know the importance of relationship marketing for the promotion of the
organization.
 The importance of regularity towards work, duties and punctuality to satisfy
customers.
 All the departments are interlinked. Inefficiency of one department affects
the other departments and eventually the whole organization.
 The benefit of the good coordination with other member which helps to
minimize chances of fault and mistakes.
 The practice of friendly working environment that result in goal achievement.

33
 BIBLIOGRAPHY

Avadhani, V. A. (2009). Treasury Management In India, Himalayan Publishing

Houns. Capital Restructuring Plan: Current Capital Structure (September
2009). Karobar National Daily.

Hamal, P. (2015). Customer Service Department Civil Bank Limited. Unpublished

BBA Internship Report, Faculty of Management, JMC, TU

Kandel & Katiwada. (2072). RastriyaBanijya Bank Junior Assitant Guide, Pinacle
Publication, Pvt. Ltd.

Peter. S. (1999). Commercial Bank Management, McGraw-Hill

Manandhar, K.D. & Pokhrel, S.B. (2009). Marketing Financial Services.Kathmandu:

Asmita Books Publishers & Distributors (P) Ltd.

Singh, H.B. (2007). Banking and Insurance (Revised fourth edition). Kathmandu:
Asmita Publication.

Singh, H.B. (2009). Banking and Insurance (Reused and update). Kathmandu: Asmita
Publication.
Websites:
http://www.adbl.gov.np. Retrieved Date 2017/09/04. Retrieved Time: 1:00 P.M.

http://www.adbl.gov.np/adbl_capital_plan.html. Retrieved Date 2017/09/04. Retrieved Time:

1:30 P.M.
http://www.adbl.gov.np/brief_profile.html. Retrieved Date 2017/09/04.Retrieved Time: 2:30
P.M.
http://www.adbl.gov.np/board_of_director.html. Retrieved Date 2017/09/05. Retrieved Time:
12:30 P.M.
http://www.adbl.gov.np/management_team.html. Retrieved Date 2017/09/05. Retrieved
Time: 1:00 P.M.
http://www.adbl.gov.np/corporate_vision_mission.html. Retrieved Date 2017/09/06.
Retrieved Time: 10:00 P.M.
https://en.wikipedia.org/wiki/List_of_banks_in_Nepal .Retrieved Date 2017/09/07. Retrieved
Time: 12:00 P.M.
https://en.wikipedia.org/wiki/List_of_banks_in_Nepal. Retrieved Date 2017/09/07.
Retrieved Time: 1:00 P.M.
 Annexure: I

Board of Directors of ADBL

Positions Names
Chairman Mr. Chettra Bahadur Sejuwal
Member Mr. Bishnu Prasad Nepal
Member Mr. Yogendra Kumar Karki
Member Mr. Chandra BahadurAdhikari
Member Ms. Laxmi Devi Manandhar
Member Mr. Ramesh Kumar Mahat
Member Mr. Manoj Basnet
Member Mr. Govind Prasad Bhattari
Member Mr. Ghanshyam Awasthi
 Annexure: II
Organizational Structure of ADBL, Prithivi Chowk Branch