CHAPTER ONEINTRODUCTION

1.1 Background Bachelor in Business Administration (BBA) program is the undergraduate level program of Tribhuvan University (T.U). It is a four year course with 120 credit hours comprehensive bachelor degree program .It is further divided into eight semester(two semester in each year).It is mainly practical oriented which emphasizes to provide student a practical knowledge. It aims to prepare students to become competent, confident, skilled and socially responsive professional who can effectively support managerial, entrepreneurial and leadership role in business and social organization. It is student oriented course where students should be actively participated. Its syllabus has been designed in such a way that it has tried to give student knowledge from almost every field like psychology, sociology, business law, Information Technology(IT) etc. It has got grade system of marking in GPA. Due to this distinctiveness BBA program is getting popular among the students and is becoming the first choice of every students of management field.

In the course study of BBA program students are required to do the internship in their specialized field. Internship is simply the applied form of knowledge. It is  relatively short term in nature with the primary focus on getting some on the job training and taking what’s learned in the classroom and applying it to the real world. In the beginning of 7th semester students are provided an opportunity to choose one special field for the purpose of specialization. Finally in 8th semester they have to work minimum 8 weeks in that specialized field which is called internship.

This is a report on the Customer Service and Clearing Department of Everest Bank Limited as one of the leading Commercial Bank of Nepal, as mentioned earlier, and since I had completed my internship from the Thamel, Branch Office all the details related to the Customer Service and Clearing function is based on that particular branch.

1.2 Objective of the ReportThe general objective of the study is to fulfill the requirement for the degree if Bachelor in Business Administration. The major objective is to make the BBA student relevant in the real world situation. Besides this, the specific objectives are as follows:

         To present the practical insights about the banking activities.         To explain the knowledge about the financial institution and its daily workings in a practical

scenario.         To identify the various activities done under Customer Service and Clearing Department.         To explain the relation between the theoretical and practical knowledge of the bank in action.

         To fulfill the partial requirement of BBA program at Tribhuvan University.

1.3 MethodologyCompletion of internship is a combination of the different types of activities. It starts from the selection of the organization for the internship, performance of different kinds of activities and placement in different parts of the organization and at last collection of various primary and secondary data for the preparation of the report. In terms of data collection both primary as well as secondary source had been used. In case of primary source, observation and personal interview with the staffs are used and in case of secondary source, the brochures, published reports and documents, website of the bank and other related websites had been used.Following methodologies are used to study the organization:

1.3.1 Organization SelectionThe most important and the initial part in the internship program is the selection of the organization. It is the basis from which interns get the platform to learn something and analyze the practical implication of the theoretical aspects learnt in the academic session.In this competitive market it is not an easy task to find intern in the reputed organization. Campus provided recommendation letter which internee dropped in the Human Resource Department (HRD) of Everest Bank Limited along with the CV.There were other numerous applicants applying for their internship. So it was a tough job for HRD Head to select few amongst all. There was regular follow up calls to the HRD which revealed interest and enthusiasm to work in EBL. After a week internee was informed that internee was selected and could start internship period. Finally, internee joined the bank as an intern from June 13th 2012.

1.3.2 PlacementOn 13th June, 2012 internee was placed to EBL Thamel, Branch office to start her internship. There, the internee met branch manager and was asked to meet Officer In charge and as per her order internee was placed in customer service department for three weeks under the supervision of CSD supervisor. After the completion of three weeks in CSD, internee was referred to the Clearing department for rest remaining five weeks under the supervision of clearing supervisor.

1.3.3 Duration of internshipThe duration of internship period has been defined for 8 weeks by Tribhuvan University, so as per the specified period, intern worked in EBL Thamel branch from 13th June, 2012 to 10th August, 2012. Internee thought those eight weeks were really fruitful and it will definitely help in upcoming days. It was the internship program that helps to internee to be familiar with the organization culture, work environment and working procedure of the EBL. The placement of internship is shown in the table below:

Activities/Weeks 1 2 3 4 5 6 7 8

CSDClearing department

1.3.4 Sources of DataThe following sources have been used to collect the necessary data:

a)      Primary source of dataThe required information was collected through the discussion and information provided by the officials of EBL.

b)     Secondary source of dataThe secondary data was collected from the secondary sources like: annual report, broucher, official website and other publication.

1.3.5 Activities Performed in the Banka) Customer service department

     Account opening (Personnel and Corporate)     Issuance of Debit card and  cheque book     Account closing      Balance inquiry and other information about the bank service      Providing information about products to the customers         Issuing of account statements and balance certificate         Solving the queries of the customers

b)     Clearing department         Endorsing the cheque         Keeping record of clearing cheque as well as returned cheques         Forward inter-bank cheques to head office

1.4 Limitation of the StudyEvery field of study has some or the other limitations and so in the case of internship report as well .There is some limitations that are faced at the time of my report preparation and they are as follows:

a)      The study is limited to only one financial institution.b)      It does not give detail view of overall functioning of the bank.c)      Lack of adequate time to learn, complete and detailed works in just eight weeks.d)     This report is prepared on the basis of available data and the information provided by the bank

and its staffs.

CHAPTER TWOINTRODUCTION TO THE INDUSTRY

2.1 BackgroundA Bank is a depository financial institution which purchases money and sells money for money. In this way, a bank is a sensitive sector of the industry because it plays with the public money. The primary operating activity of any bank is to collect fund in the form of deposit from the surplus sector of the economy and transfer this collected fund to the deficit unit of the economy in the form of loans. The benefit that the surplus unit gets by depositing their access fund in the bank and the charge that the deficit unit pays for using the fund of the bank are both expressed in percentage and that rate is known as the interest rate. The difference between the lending interest rate and borrowing interest rate is called interest spread and this spread is the major source of income of any bank.

According to Nepal Rastra Bank Act 2002 Bank is a financial institution, which provides financial services that may be in the form of accepting deposits, advancing loan, providing necessary technical advice, dealing over foreign currencies, remitting funds, etc.According to Indian Banking Company Act 1949 Banking means the accepting for the purpose of lending or investment of deposit of money from the public, repayable on demand or otherwise and withdrawal by cheque draft order or otherwise.

In simple, bank is an institution which deals with money and credit. A bank is a financial institution that serves as a financial intermediary, who bridges gap between the savers of the fund and users of the fund. Bank exists in the economy to perform the function of the intermediary. Banks intermediates not only the surplus and deficit units but also perform various management activity to create a balance in the economy. It should perform the size intermediation because in general surplus units are large in number but they less amount of

surplus funds and the opposite scenario is of the deficit side. Similarly it should perform the maturity and information intermediation as per the requirement.

2.2 History of BankingThe concept of banking is not a modern concept. This concept had started to evolve in the brilliant human mind immediately after the humans were able to realize and develop money. Though money had made the human life much easier than before but ancient humans started to realize the complexities that evolution of money had created in their life. So, in order to overcome these complexities and the difficulties that were attached with the benefit of money the concept of banking emerged in the human mind. Earlier the moneylenders and the landlords perform the banking activities as the informal banks but later the activities of these people are formalized and the concept of bank as an institution had emerged.Moving towards the word “Bank”, it is thought to be derived from the Italian word “Banco”, Latin word “Bancus” and French word “Banque” because all meant the bench in which the bankers would keep money and its records. The Jews of Lambardy were thought to be the early bankers who transacted third business at the benches in the marketplace and when they were unable to meet their liabilities, the depositors used to break their benches and this tradition had given birth to a banking term “Bankrupt”.The first ancient Bank of the world is supposed to be the Bank of Venice which was established in 1157 A.D. Following the footsteps of this bank, other two banks were established in 1401 and 1407 named Bank of Barcelona and Bank of Geneva, respectively. The crucial breakthrough in the modern banking history was made in 1694 A.D when the first modern bank “The Bank of England” was established. After the establishment of this first English Bank, Banking sector had experienced various ups and downs but still they persisted and because of that persistence they are now able to exist in this 21st century world as one of the essential element of human life.Presently, banks are not only the deposits collecting and loan lending institutions but also the institutions which helps its customers from various ways as per their convenience and ability with full security. They had been developed as the essential service providing institutions in this rushing world. Hence, banking had become an important element of the world economy in the present time.

2.3 Evolution of Banking Industry in NepalThough the world had already leaped forward towards the modern banking practices but till 1937 A.D, the Nepalese were completely unaware of these developments and still using the money lenders and the rural landlords as the informal banks. This scenario is enough to explain that the banking history of Nepal is not too long. Only after the establishment of Nepal Bank Limited in 1937 as the first Nepali Bank, Nepalese people came to know that there is also another way to get loans except the goldsmiths, and the moneylenders and this can be formalized in the form of institution named Bank.

Tejarath Adda established during the tenure of the Prime Minister Ranoddip Singh (1993 B.S) this was the first step towards the institutional development of banking in Nepal. It tendered a good service to give loans to government employees and public against bullion.

Banking in modern sense started with the inception of Nepal Bank Limited (NBL).Nepal Bank Limited was established in 1994 B.S, as a semi-government organization without existence of a central bank in the country under special Banking Act 1936, having elementary functions of a commercial bank. 51% of the paid up capital of Nepal Bank Limited is owned by the Government and 49% owned by the public. Later, on Nepal Rastra Bank was set up on 2013 B.S. as the first central bank under Nepal Rastra Bank Act 2012 B.S with an objective of supervising, protecting and directing the functions of commercial banking activities. Another commercial bank fully owned by the government, “Rastriya Banijya Bank” was established in 1996,which made it possible for the Nepal Rastra Bank to devote more attention to the important aspects of economic, monetary and fiscal development. Industrial development center was set up in 2013 B.S it was converted into Nepal Industrial Development Corporation. Agricultural Development Bank established in 2024 to finance agricultural produces.

 Joint venture banks in Nepal gave a new horizon to the financial sector of the country. Nepal Arab Bank Limited later renamed as Nabil Bank Limited in 2041 B.S as a first joint venture bank to be a milestone in the history of banking which gave hope to the sluggish financial sector.After the restoration of democracy in Nepal there has been tremendous development in banking sector. The economic and financial reform policies undertaken by the government have increased both number of banks and the types of services offered. The category of banks in the context of Nepal are shown in the table.

Category Component Minimum paid up capital requirement

Number

KA Commercial Banks 200 crore 32KHA Development Banks 64 crore 89GA Finance Companies 20 crore 79GHA Micro Credit institutions, Co-operatives 1 crore 21

Since the interne had completed the internship in one of the commercial bank of Nepal, the analysis is specifically focused on the “KA” category depository institutions i.e. the Commercial Bank.

2.4 Introduction of Commercial BankLike all financial intermediaries, the commercial bank acquires funds one group of surplus spending units and makes these funds available to other deficit units. It provides transactional, savings and money market accounts and that accepts time deposits. Commercial banking may also be seen as distinct from retail banking, which involves the provision of financial services

direct to clients. The powers are available to commercial banks by seeing the sources and uses of funds available to the typical bank. An institution which accepts deposits, makes business loans, and offers related services. Commercial banks also allow for a variety of deposit accounts, such as checking, savings, and time deposit. These institutions are run to make a profit and owned by a group of individuals, yet some may be members of the Federal Reserve System. While commercial banks offer services to individuals, they are primarily concerned with receiving deposits and lending to businesses. Because of being the member of the central bank, the scheduled commercial banks enjoy a strong and financial goodwill which attracts huge amount of deposits industrialists, traders and the public at large. Commercial Banks extend various types of credit facilities to their constituents, to enable them carry out their business activities. These facilities may be broadly divided into two categories:

         Funded and         Non- funded facilities

Funded facilities are those, where Banks actually part with money. Non funded facilities, on the other hand, are those where the Bank does not actually part with money, but promises to do so, contingent upon the occurrence of certain events. Which means, unless the said event occurs, the Bank will not be called upon to part with money.In Nepal the financial sector is growing in slow pace that has supported its economy to some extent. Nevertheless the partition of the financial sector can be done on the basis of banking and non banking financial sectors. The embanking system comprises of thirty one commercial banks, eighty eight development banks, seventy nine finance companies and twenty one graven bikas banks. The non-banking financial system includes many finance companies, contractual saving institutions (employees’ provident fund and insurance companies), cooperative financial institution, non-governmental organization (NGO’s), postal saving offices, etc. Nepal bank limited is the first and oldest commercial bank of Nepal that was established in 1937 A.D. However, the second Rastriya Banijya Bank came in operation in 1966 A.D. in particular; commercial banks can help a firm speed up the collections as well as delay its cash disbursements. The first joint venture bank was established in 1984 A.D. The commercial banking sector accounts for 53 percent of total financial system assets when NRB is included - and 74 percent if NRB is excluded. Rastriya Banijya Bank and Nepal Bank Limited dominate the commercial banking sector, holding around about 60 to 65 percent of total commercial banking system assets.One of the most important operations of it is to determine the creditworthiness of potential borrowers. The commercial banks can comfortably use so much leverage is that they have the ability to diversify much more than most other types of businesses. The operation activity of commercial banks includes:

         Deposit collection         Liquidity management         Credit administration         Capital structure management

2.5 Functions of Commercial Banks in NepalThe functions of commercial banks are divided into two categories:

1)      Primary Functions

The primary functions of a commercial bank include:         Accepting deposit         Advancing loan         Discounting bill of exchange         Transfer of money

2)      Secondary FunctionsThe secondary functions of a commercial bank include:

         Issuing letters of credit, travelers' cheques, circular notes etc.         Undertaking safe custody of valuables, important documents, and securities by providing safe deposit vaults

or lockers.         Transferring money from one place to another and from one branch to another branch of the bank.         Standing guarantee on behalf of its customers, for making payments for purchase of goods, machinery,

vehicles etc.         Collecting and supplying business information.         Issuing demand drafts and pay orders and         Providing reports on the credit worthiness of customers.

Thus, the primary and secondary functions performed by bank are the essential to meet the overall objectives of the bank.

CHAPTER THREEINTRODUCTION TO THE ORGANIZATION

3.1BackgroundEverest Bank Limited (EBL) started its operations in 1994 with a view and objective of extending professionalized and efficient banking services to various segments of the society. The bank is providing customer-friendly services through its Branch Network.

All the branches of the bank are connected through Anywhere Branch Banking System (ABBS), which enables customers for operational transactions from any branches.With an aim to help Nepalese citizens working abroad, the bank has entered into arrangements with banks and finance companies in different countries, which enable quick remittance of funds by the Nepalese citizens in countries like UAE, Kuwait, Bahrain, Qatar, Saudi Arabia, Malaysia, Singapore and U K. Bank has set up its representative offices at New Delhi (India) to support Nepalese citizen remitting money and advising banking related services.Punjab National Bank (PNB), the joint venture partner of Everest Bank (holding 20% equity in the bank) is the largest nationalized bank in India. With its presence virtually in all the important centers at India, Punjab National Bank offers a wide variety of banking services which include corporate and personal banking, industrial finance, agricultural finance, financing of trade and international banking. Among the clients of the Bank are Indian conglomerates, medium and small industrial units, exporters, non-resident Indians and multinational companies. The large presence and vast resource base have helped the Bank to build strong links with trade and industry.Recognizing the value of offering a complete range of services, EBL has pioneered in extending various customer friendly products such as Home Loan, Education Loan, EBL Flexi Loan, EBL Property Plus (Future Lease Rental), Home Equity Loan, Vehicle Loan, Loan Against Share, Loan Against Life Insurance Policy and Loan for Professionals.EBL was one of the first banks to introduce Any Branch Banking System (ABBS) in Nepal. EBL has introduced Mobile Vehicle Banking system to serve the segment. EBL is one of the renowned institutions. The capital structure which includes authorized capital is Rs2,000,000,000. Similarly the issued capital is Rs1,281,406,500 and the paid-up capital is Rs1,279,609,490. The vision and mission of EBL are as follows:

Vision         To evolve & position the bank as a progressive, cost effective & customer friendly institution

providing comprehensive financial and related services.         To integrate the frontiers of technology & serving the various segments of society.         To be committed to excellence in corporate values.

Mission         To provide excellent professional services & improve its position as a leader in the field of

financial related services.         To build & maintain a team of motivated and committed workforce with high work ethos.         To use the latest technology aimed at customer satisfaction & act as an effective catalyst for

socio-economic developments.Every organization has its own structure to depict its line of authority and accountability. There are top level management, middle level management and lower level management. Top level manager is superior to middle level manager. Lower level manager is at the low level. Organizational structure of EBL is shown in the figure below: 

 EBL Functional Chart (Source: Annual Report)

3.1.1 AwardsSince EBL is one of the renowned institution among the various financial institution of Nepal. The awards received are as follows:

         The bank has been conferred with “Bank of the Year 2006, Nepal” by the Banker, a publication of financial times, London.

         The bank was bestowed with the “NICCI Excellence award” by Nepal India Chamber of Commerce for its spectacular performance under finance sector.

3.1.2 Pioneer AchievementsThe pioneer achievements of EBL are: EBL was one of the first banks to introduce Any Branch Banking System (ABBS) in Nepal. EBL has introduced Mobile Vehicle Banking system to serve the segment deprived of proper banking facilities through its Birtamod Branch, which is the first of its kind. EBL has introduced branchless banking system first time in Nepal to cover unbanked sector of Nepalese society. EBL is first bank that has launched e-ticketing system in Nepal. EBL customer can buy yeti airlines ticket through internet.

3.1.3 ObjectivesThe objectives of EBL are listed below:

         To become the bank of first choice.         To bridge the gap between saver and borrowers efficiently and effectively.         To provide the higher expected rate of return on investment.

3.2Main Business Activities of EBLEBL’s main business activities are to perform all the business transactions of a typical commercial bank.

         It accepts deposit such as current, saving, fixed deposit etc and grant different types of loans such as education loan, home loan, professional loan etc.

         It transfers money from one place to another through the means of draft, SWIFT, at its customer’s request.

         It provides safe deposit lockers of different sizes.         It purchases and sales foreign currencies and travelers cheque.         It acts as guarantor on the behalf of its customers.         It provides LC (letter of credit) services to its customers.         It provides other services like ATM, ABBS, e-banking etc.

3.3 Shareholding StructureThe local Nepalese promoters hold 50 percent stake in the bank’s equity, while 20 percent of the equity is contributed by joint venture partner PNB who has also undertaken management responsibility under a Technical Service Agreement (TSA). The remaining 30 percent is held by the general public. This is shown in the following table:

Group Categories % of holding

A Nepalese Promoters Ownership 50%B General Public 30%C Joint Venture (PunjabNational Bank, India) 20%Total 100%

The share ownership discussed above of EBL is shown in the following pie-chart.

3.4 Product and Services Provided by EBLEBL offers a wide variety of products and services, catering to wide range of customers from individuals, to mid market local corporate to multinationals and large public sector companies, as well as embassies, aid agencies, airlines, hotels and government corporations.Everest Bank’s policy is to extend quality services to its customer as properly as possible. Bank’s policy is to extend quality services to its customers as properly as possible. Personalized services are provided to all clients. To extend more efficient services to its customer, EBL has adopted innovated and latest banking technology. Everest Bank tailors the facilities extended to its clients, taking into account their need and requirement, besides the normal services, EBL has been providing the following services to their customers. In many of these services, EBL has the pioneer.

3.4.1 Deposit

EBL offers a wide array of deposits schemes in both local and foreign currencies to help the customer earn competitive interest rates in order to maximize returns on investment. Some of the deposits schemes are as follows:

         Current account         Saving account

The types of saving account are: normal saving, naari bachat khata, saving premium account, baal bachat khata, saugat bachat khata and freedom saving account.

         Fixed deposit accountThe types of fixed deposit account are: supreme deposit, cumulative deposit scheme, cash certificate scheme and unfixed fixed deposit scheme.

         Recurring deposit accountThe types of recurring deposit account are: sunaulo bavisya yogana and flexi recurring deposit account.

         FCY deposit accountThe types of FCY deposit account are: USD account and EBL NRN deposit account.

         Retirement plan account

3.4.2 Loans and AdvancesEBL provides credit on competitive terms by way of term loans as well for financing working capital needs of all kinds of productive and income generating activities. Regarding Consumer Lending Schemes it has following major schemes:

         Direct Housing Loan         Vehicle Loan         Education Loan         EBL Property Plus         Professional Loan Scheme         Loan Against Mortgage         Loan Against Share         Home Equity Loan

3.4.3 Trade Finance ActivitiesThe bank provides their customer with letters of credit and guarantees, etc facilities to facilitate their business transactions.

3.4.4 Remittance FacilitiesRemittance can be made to any part of the world by way of SWIFT Transfer instantly in addition to the conventional facilities like demand drafts, Travelers’ cheques etc. EBL has drawing arrangements with about 130 branches all over India for remittance to India. EBL facilitates both Inward and Outward remittance.

3.4.5 Foreign Exchange FacilitiesThe bank provides facilities for financing the export and import business, exchange (sale and purchase) of foreign currencies, forward exchange contracts, etc.

3.4.6 Cards and ATM’s FacilitiesEBL debit card is a plastic card which provides an alternative payment method to cash when making purchases or cash withdrawal from ATM centers. It is associated with Smart Choice Technology (SCT), it facilitates wide sharing of ATMs under SCT network from more than 650 Locations throughout Nepal. EBL debit card holder can also have the withdrawal facility from over 5000 PNB ATM in India.

3.4.7 E-banking FacilitiesEBL offers E-banking facilities too. Through a computer connected to the Internet, customer can log on the Everest Net Site and do various banking transactions from anywhere at any time.Internet BankingIt is used for: Account summary/ Statements Balance Inquiry Fund Transfers Offline Requests (Cheque books, remittance etc.) Ordering for different types of payments3.4.8 Any Branch Banking System (ABBS)EBL provides any branch banking service where customer can conduct their business or make transaction from any of branch of EBL, deposit of where they have opened their account. There is no charge EBL provides any branch banking service where customer can conduct their business or make within the branch of Kathmandu valley and in case of outside the valley bank charge basically 150 per transaction.

3.5 Financial Indicators of EBLThe financial indicator of EBL is shown in the table below:Indicators 2008/09 2009/10 2010/2011Deposit 33322.9 36932.3 41127.9Loan and Advances 612.0 704.6 782.0Operating Profit 1073.5 1349.1 1516.7Total Income 2565.3 3500.8 4728.8Total Expenses 1491.8 2151.7 3212.1Earning per share 99.99 100.16 83.18Market per share 2455 1630 1094Price earning ratio 24.55 16.27 13.15Cash reserve ratio 14.26 15.53 9.55

Net Profit 638.7 831.8 931.3

Thus, these financial indicators indicate the overall status of Everest Bank Limited in the global context. These indicators help to measure the performance and operational goals. These indicators strive to cover the issues of financial stabilityas a systematic phenomenon and therefore concern to financial institution and markets.

CHAPTER FOURANALYSIS OF ACTIVITIES DONE AND PROBLEMS SOLVED

4.1 BackgroundAs an internee, it was indeed a great opportunity to know about the banking activities in depth. The internee was rotated through various departments of the bank, which exposed her to the real world of the bank and observed the real operations of the bank as the internee had only the theoretical knowledge. During the internship, internee had performed to activities mainly in customer service and clearing department. To generate the profit, a financial institution needs

customers and receives the amount through different names of deposits. At EBL internee had an opportunity to study and observe in details about the customer services, new account opening procedures, deposit procedure and clearing procedure of EBL.

4.2 Customer Service Department (Front Desk)Customer service is the front desk of any organization. For any organization, it is the important place which makes an early impression to the clients. It is the place where customers make the first contact with the clients. The image and the reputation of bank depend upon effective functioning of this department. It is the first place where the customers first get the service.It is very important to know that a highly satisfied customer stays loyal longer, buys more as the organization introduces new product, pays less attention to competing brands and is less sensitive to price. A significant number of this kind of customers is only possible through the efficient functioning of customer service department of any organization. It would then not be inappropriate to say that this department is the key to success of any organization.

This department is involved in various activities from opening an account to its closing, providing account statement as per customer demand, issuing ATM etc. The basic functions of this department are customer counseling, account operations and distribution activities etc.“Customer counseling is most important functions of customer service department. A customer is the most important visitors on the premises. He does not depend on us, we are depended on him. He is not the interruption on our business. He is part of it. We are not doing him a favor by serving him. He is doing us a favor by giving us an opportunity to do so”.

Customers are related as a god because they are the one for whom the product are design. As Everest value the customer trust, they have implemented the policies and procedure just to safeguard the account and the personal as well as the financial information for their customers.

The point detailed here is mainly associated with the customer’s personal account. This is because they treat business account information with great cares, so they respect the privacy off all their customers. They are:

    Provides the highest quality serviceEBL CSD provides quick response to the customers and maintains accurate, up to date account records.

       Protect customer informationCSD is only the place from where most of the information is gathered. Thus EBL’s CSD confirms the identity when a customer makes a constant just to safeguard against unauthorized access other account.

             Makes banking more convenient

The information provided convenience for the customer to do virtually all banking when and where they want through telephone and web banking service.

             Make Aware of serviceThe banking problem being faced by the customer is identified by CSD in a most effective way. They clarify about the entire product as well as services provided by the bank to their customer.

4.3 Major Activities Performed on Customer Service DepartmentThe major activities performed on customer service department are listed as below:

4.3.1 Account OpeningDuring the internship period internee was placed in Customer Service Department thereby, helped customers in opening accounts. Therefore, performed the following functions:

      Provided the account opening form      Provided the information on minimum balance requirement and the interest rate in various

schemes      Verified the attached documents      Prepared the voucher for deposits      Opened the account in Finnacle

 Documents to be enclosed for Account OpeningThe documents needed for the account opening varies from one account to another account. The individual needs less document but a corporate organization needs more documents and more formalities too. The documents needed as per account can be shown as below:

a) Current AccountIt is an account on which any amount deposited can be withdrawn through a cheque. It is also known as checking account. It consists of:

  Proprietorship Account:

A business firm registered in the name of a person/proprietor is known as Sole Proprietorship Firm. The proprietor bears all the profit or loss of the business. Requirements for opening proprietorship account:

         Registration Certificate         Tax Certificate         Citizenship Certificated Proprietor         2 PP size photos

  Partnership Account

A firm registered in the name of more than one individual is known as Partnership firm. The profit and loss from the business operation is shared by the partners. Requirements for opening partnership account:

     Partnership Agreement deed     Firm Registration Certificate     Tax Certificate     Citizenship Certificate of Partners     2 PP size photos of partners

  Limited Company Account

Limited Company Account can be maintained by both private and public limited companies. Requirement for opening proprietorship accountare:

         Registration Certificate

         Memorandum & Articles of Association

         Name, Address of directors & Office Bearers of the Limited Company with copy Citizenship Certificate

         Name & Signatures of the Persons Authorized to Operate an account

         Operation Commencement Certificate (for Public Ltd. Co.)

         Resolution of Board of Directors regarding opening & conduct of an account

         Tax Certificate

  Club Society & Association Account

Various clubs, social institutions, etc can also open accounts by fulfilling the requirements. Requirements for opening this account:

         Registration Certificate

         List of Office Bearers

         Resolution Regarding Opening & Conduct of Account.

         Name & Signature of the persons authorized to operate the account.

b)     Saving Account

Basic requirements for opening Personal Account         Citizenship Certificate or Passport.          2 PP size photos.

Basic requirements for opening Joint Account

         Documents certified from concerned Embassy.

         All documents required for personal account for all joint parties.

         Special instruction must be provided to the bank in the application form in case of any one signature among the joint account holders.

         ATM/Debit Card is not provided to joint account holders.

c)      Call AccountThe documents required is same as of other saving accounts. After getting the above requirements the customer service department opens the account using the banking software i.e. Finnacle Software. It assigns the account number which is of fourteen digits, accepts the deposit after filling up the deposit slip (voucher) and issues cheque book and ATM/Debit card to the account holder. Cheque books are issued instantly. Individual and non-profit making organization generally operate saving account in the bank to earn interest. Its main purpose is to encourage the habit of saving among the civilian and institution. Though saving deposit is known for saving purpose, most of the banks allow its customer to withdraw limited or restricted amount of money. If the account holder wants to withdraw more than restricted level, prior information is required.

4.3.2 Account ClosingAs per the request of the customer, account closing is also performed. For this account closing form should be filled by customer who is examined by staff and forwarded for verification. As per the rule of bank, certain balance is deducted as closing charge and remaining amount is refund to the customer.

Following functions are performed for it         Provided the account closing form         Known the reason for closing the account         Verified the signature         Ensured the unused cheques, used ATM card are returned back to bank         Finally handled the documents to the authorized personnel

4.3.3 Provided Safe Deposit LockerFor locker facility some steps to be followed:

         The customer must maintain an account with bank.         Identification documents must be submitted with filling locker form.         Deposit should be maintained.

Everest safe deposit locker ensured that your most precious, be it jewelry, passport, share certificate are secured in our world class Safe Deposit Locker from fire and theft. There are three sizes of locker; they are LARGE, MEDIUM, and SMALL. The cost is 3500, 2500, 1500 accordingly.

4.3.4    Issuance of Account Statement and Balance CertificateThe account statement and balance certificate is provided to the customer on the demand basis. Statements should be collected by account holders of person assigned by the customer. Fee is not charged for statement but for balance certificate fee is charged.

4.3.5 ATM Card IssuanceATM card is issued to the customer after completing the account opening process. Maintained registered, verified and entry in Finnacle is made and then ATM is given to customer. Basically Rs200 is charged for ATM cards.

The individual customers having Saving Account, Current Account and Saving Premium Account maintaining the minimum balance is eligible for the EBL Debit Card. An EBL debit cardholders could draw cash from PNB ATMs in India with withdrawal charge of NPR 160 per transaction and charge of NPR 24 per balance inquiry. The maximum limit of withdrawal per transaction is NPR 16,000 and per day limit is NPR 16,000 (In India), whereas monthly limit is NPR 160,000. Similarly, a PNB debit cardholders could draw cash from EBL ATMs in Nepal with withdrawal charge of INR 50 per transaction and charge of INR  per balance inquiry. In Nepal customer can withdraw Rs100000 in a day.

4.3.6 Cheque Book and ATM DeliveryThe cheque books are prepared after making the entry of account opening in computer system. The customer can collect their cheque book only next day after giving request for cheque book. Respective customer should be presented for taking cheque book for first time issue and for ATM they must be compulsorily presented.

4.3.7 Dealing and Handling Customer GrievancesThe overall functioning of this department is concerned with dealing with the customer and handling their grievances. People with different queries and problems come in the bank. In my stay at this bank I handle different types of problems of the customer related to loss of cheque book, debit card, forgetting of PIN No. and so forth.

4.3.8 Use of Office EquipmentVarious office equipment are used like photocopy machine, cheque writer, printer, fax machine, ECC machine etc for various tasks.

4.3.9 Other ActivitiesMainly the activities related to providing effective services to the customer are done. Besides that other activities like cash sorting, telephone handling, filing, clearing preparation etc are done. During her stay the internee was able to perform various task assigned by the supervisors.Thus, various activities are done which helped the internee to enhance the skill in dealing with customer, answering their queries and handling their grievances. It helped to develop the managerial attitude and behavior to carry out managerial function in future.

4.4 Clearing DepartmentClearing is a process by which a banker exchanges cheques drawn against another bank and deposited at their bank for collection or clearance from their customer at the clearing house. Customers deposit cheque, drafts in their accounts, which are drawn on various banks and bank serves their customers by helping them collect the fund in their account through clearing function. Fund realized and credited in customer’s account next working days.

4.4.1    Functions of Clearing DepartmentThe functions if clearing department are as follows:

         To accept transfer deliveries and clearing cheques from the customer of the branch and to arrange for their collection.

         To arrange the payment of cheque drawn on the branch and given for collection to any other branch of EBL or any other members, or sub-members of the local clearing house.

4.4.2 Parties Involved in Clearing ProcessBasically there are three parties involved in the clearing process. They are:a) Applicant Bankb) Nepal Rastra Bankc) Beneficiary Bank

         Applicant BankThe applicant bank is those who receive the cheque of other bank with a deposit voucher of itsown bank including the stamp of the party, signatures and the account number.

         Nepal Rastra BankNepal Rastra bank acts as the intermediary between the applicant bank and the beneficiary bank. It carries out the settlement procedure related to the collected cheques and drafts. It is also known as the clearing house of Nepal.

         Beneficiary Bank         Beneficiary bank are those on whom the cheque is to be credited.

4.4.3    Clearing Procedure of EBL, Thamel Clearing procedure starts with the receiving of cheque of other bank with its deposit voucher attached to it in EBL. The outward clearing cheques are initially listed in the clearing cheque register book to keep the records of clearing cheque. Then, those cheque are separated on behalf of local currency cheque and foreign currency cheque. After the separation of the cheque, EBL stamp is given on the face as well as back side of the cheque. After this process, the cheque is put through the ECC system that is the Electronic Clearing Cheque system through which the cheque is passed automatically to the clearing head office Baneshwor Branch. Then the clearing head office Baneshwor transfer the cheque to the intermediary bank or the clearing house that is Nepal Rastra Bank for the final settlement of clearing the cheques. Finally, the beneficiary bank is credited and the applicant bank is debited of its account through ECC system. Thus, the process of clearing cheque ends here.

4.4.4 Local Currency ClearingLocal currency clearing settlement deals with the settlement of local currency that is NRP in the context of Nepal through the clearing house. This settlement is carried out by each and every members of the clearing house. Except Thursday and Saturday, clearing of local currency is done.

4.4.5 Foreign Currency ClearingThe foreign currency cheque and drafts collected by the clearing members of the clearing house are settled for the clearance of foreign currency. However, the convertible foreign currencies that

have been fixed by NRB are only settled. The clearing of foreign currencies are not carried out at Thursday, Friday and Saturday in Nepal avoiding the national holidays.

4.4.6 Reporting of Cheque ReturnAll the collected home cheques re-fund cheques and return cheques from NRB should enter in the computer system. Here at EBL bank Finnacle software was used to keep the record track of the respective cheques. Some of the cheques may not be sound for making the payment so here we need to make the explanation of the return cheques. For the description process, date, client name, client code, name of the bank, reasons for return and the account number is recorded. Representative member should then prepare a statement of cheques returned as per format and fax it to the clearing house. The returned cheques are returned to the respective bank through ECC system. Bank should return the cheque to the particular bank with the memo slip defining the reason of dishonor. The associate of the bank receiving the cheque should confirm the receipt of the cheque by signing at the register of the presenting bank. The original memo slip is provided to the receiving bank and the duplicate is brought back by the returning bank as it confirms the receipt of the cheque.

4.4.7 Flow of Clearing Cheque

Description of the Above FigureAfter making the deposit of the cheque, documentation process is carried out looking to the details of it. It is to check whether the cheque so presented is outward or inward cheque. The outward cheque goes for clearing. There are two main processes about the compliance and noncompliance of the cheque. If there occurs compliance, the cheque is instantly settled. In case if it does not fulfill the criteria of cheque standards, it is dishonored and finally returned bank to the respective banks.

CHAPTER FIVECONCLUSION AND LESSON LEARNT

5.1 ConclusionCommercial Bank in Nepal could be viable only if they could provide maximum qualitative services to the customer of the bank who is the main source of income for the banks. Without the customer no bank can fulfill its objectives. To maintain the standard of the bank it should always look for measure to adapt to changes to a better level.

This report has been prepared as the partial fulfillment of eighth semester of BBA under TU. Everest bank limited proved to be a strong mainstay for building up my professional career. The internship gave me the perfect opening to plant my acquaintance in the appropriate field. It helped me to apply the year’s long theoretical lessons into practical area. Further, in past 8 weeks, I learned to work under pressure and broadened my knowledge, vision, ability and

confidence to perform in real working upbringing. It was a great chance to gain practical knowledge of banking sector. Beside this, the supervisors were extremely helpful in guiding on our internship program.

It was the great experience working as an intern in Everest bank limited. The operational environment was friendly. There was good communication and healthy relationship in between the different levels of staffs. The author was able to find out various services offered and facilities provided by Everest bank limited. Working as an intern mainly provided us an opportunity to learn about practical implication in our career building hence it is a significant platform for our future career.

5.2 Lesson Learnt“Practice makes a human practical and perfect”. The eight weeks internship period in EBL has taught me many lessons. I have learnt different skill and obtained a variety of knowledge during my internship period. Internship for 8 weeks really taught us many things which have been listed below:

         Learned to tackle the various problems of the customer.         Learned to prepare and issue cheque books and activate the debit card.         Learned to use the office equipment like photocopy, faxes, cheque writer, printer etc.         Learned about general banking practices and corporate culture.         Learned to be self confidence to contact with the customer and make them feel comfortable in

every way.         Learned to make effective communication skill for quick and efficient service.         Learned to understand different types of stamps that were in use. They were so called crossed

stamp, bank’s stamp, endorse stamp and paid stamp.         It was the great chance to be familiar with the use of Finnacle Software that helped a lot in

maintaining the proper balance in the overall activities of the bank. In case if it failures, the whole activities of the bank comes into halt creating the huge loss to the bank.

Thus, I want to conclude that throughout the internship period I learnt and develop to use theoretical knowledge in the practical business world. Hence, internship in EBL not only gives an insight to learn about how the bank performs interbank transactions in Nepal, but also boosts our future prospects in the banking sector as well.

BIBLIOGRAPHY

Kolb, R.W.  & Rodriguez, R.J. (2007). Financial Institutions and Markets.          Newyork:  Blackwell.

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

Shrestha, M.K. &Bhandari, D.B. (2008). Financial markets and Institutions.Kathmandu: Asmita Publication.

Thapa, K. &Parajuli, B. (2010).Financial Institutions and Markets.    Kathmandu: Januka Publication.

Shrestha,Sarada (2011) Report on clearing department, Karhmandu: An unpublished intern report submitted to FOM, TU.

Websiteswww.nrb.org.np (4thsept, 2012)

www.everestbankltd.com (4thsept, 2012)