AN INTERNSHIP REPORT ON MAHALAXMI BIKASH

BANK LIMITED TIKAPUR BRANCH

Submitted by:
Ranjana Rawal
FU Reg. No. MG-2020-1-02-0755
Symbol No. 8061147
Tikapur Multiple Campus

Submitted to:
Faculty of Management
Far Western University
Mahendranagar, Kanchanpur

As per partial fulfillment for the requirement of Bachelor of Business Administration

BBA Sixth Semester

September, 2023

i
 INFORMATION SHEET

Name of the firm: Mahalaxmi Bikas Bank limited

Address: Tikapur-01, Kailali
Phone Number: 091-560917,
Date of joining: 26-March-2023
Name of the firm guide: Sarita Kumari Swar
Designation Of the firm guide: Operation incharge
Student Name: Ranjana Rawal
Campus Name: Tikapur Multiple Campus
Faculty: Management
Level: Undergraduate
Program: BBA
Semester/ Part: Sixth (6th)
Examination Year: 2080 B.S
Contact Number: 9745628249
Student E-mail ID: [email protected]

DECLARATION
ii
I, Ranjana Rawal hereby declare that this submission is my own work and that, to
the best of my knowledge and belief, conducted during my internship at Mahalaxmi
Bikas Bank Limited. All information and data presented in this report are authentic
and have been collected and analyzed in accordance with the objectives and
requirements of the internship.

Further I would like to declare that the report prepared by me is only for the
academic purpose. The contents included by me are taken from the observations,
secondary data, and internet sources.

Thank you.
…………………………

Ranjana Rawal

Symbol No.8061147
BBA 6TH SEMESTER

BONAFIDE CERTIFICATE

It is certified that this internship project report entitled “An Internship Report On
Mahalaxmi Bikas Bank Limited” is the Bonafide work of Ranjana Rawal who
carried out the project under my supervision. This report is forwarded for
examination.

iii
………………… …………………………
Bharat Kumar Tiruwa
…………
Umakant Subject Committee Head
Bhandari
Faculty of Management
Assistant Lecturer
Tikapur Multiple Campus
Tikapur Multiple
Campus Tikapur, Kailali
Tikapur, Kailali

iv
 ACKNOWLEDGEMENT

An internship report “AN INTERNSHIP REPORT ON MAHALAXMI BIKAS

BANK
LIMITED” has been as a prerequisite for the Bachelor Degree in business
administration of Farwestern University. This report has highly helped me to expand
my knowledge on banking sectors and other activities related to banking system of
Nepal. I am indebted to my college Tikapur Multiple Campus for the great
opportunity to experience this type of practical and necessary work which is very
beneficial in my future career.

I would like to express my deep gratitude to all those who assisted with their
valuable suggestions and numerous ideas with valuable time while preparing the
project. We would like to extend our gratitude to extend our gratitude to Mr. Padam
kathayat Branch manager of Mahalaxmi Bikas Bank Limited. We are also grateful to
all staffs Mrs. Sarita Swar, Dwarika Adhikari, Dhana Kathayat, Bishal Maduwa, Lal
bahadur kadayat,Dharma Raj Rokaya for their valuable co- operation, guidance,
direction, and continuous support throughout the internship period.

I would like to express my sincere thanks to HOD of management faculty Mr.

Bharat Kumar Tiruwa and Raju kandel lecture of Tikapur Multiple Campus ,Tikapur
kailali and the entire faculty members who have come across me from the initial
stage of my project work to the complete execution of my project work.

Ranjana Rawal

Tikapur Multiple Campus

Symbol No: 8061147

v
 ABBREVIATIONS

BBA:
Bachelor Of
Business
Administratio
n
IME:
International
Money
Exchange
ABB:
Any Branch
Banking
services
ASBA:
Applications
Supported by
Blocked
Amount
ATM:
Automated
Teller
Machine
BOD:
Board of
Director
CSD:
Customer
Service
Department
ECC:
Electronic
Cheque
Clearing
MBBL:
Mahalaxmi vi
Bikas Bank
Limited
KYC:
 ABSTRACT

An internship is first step of learning experience at work environment after the

studying of theoretical knowledge in collage. An internship help to fullfill Practical
knowledge for students. The internship has been completed in the Mahalaxmi Bikas
Bank Limited Tikapur Branch.
It has been good opportunity to do internship in one of the leading A class Financial
institution licensed Bu Nepal Rastra Bank “Mahalaxmi Bikas Bank Limited”.
During the internship period, I have learned various banking activities in different
department. It was my first experiences in banking sector. The study shows the
importance of the internship program. It will help the student to be fully aware of
the real- world practices before entering into the market.

During the internship period at MBBL; real life job experiences was achieved. I
spent most of the time in CSD and Operation Department. Customer Services desk
is the desk where all the required information is provided to the customers. Credit
Department deals with Lending of Money, credit approved, recovery, Risk
management and so on. Various general functions such as account opening and
closing, balance inquiry, cheque book issue, and ATM providing etc, are performed
by CSD.
The 3 month internship period was very helpful as it helpful me understand the
diverse role a bank employee has to play and the functions of a financial institution to

vii
its fullest, as this internship opportunity has helped me to analyse my internal
strength and weakness and developed me professionally. This experiences taught me
importance of personal relationship and consequently, helped to develop inter
personal relationship skills.

EXECUTIVE SUMMARY
As per the requirement of Far Western University course under BBA program this
report is designed according to the knowledge gained on field base experiences. The
main aim of the 3-month internship program is to provide internee an opportunity to
implement their theoretical knowledge practically. Out of the various area or sector
for internship, I choose banking sector, more specifically customer service
department of MAHALAXMI BIKAS BANK LIMITED ,Tikapur ,Branch . This is
the world of economy, competitive service-oriented product. The world is getting
smaller and smaller in terms of globalization due to the development of technology.
Among the various business firms banking plays very important role in an economy
by providing various services like: payment system, deposit, loan etc. But it is not
easy to cope and function in the changing globalized environment. This is only
possible with the help of sound planning.

Although this report is the outcome of 3-month experiences in CSD of MBBL. I have
mentioned all the important information as far as possible. This report is basically
based on secondary data also it‟s an outcome of various experience, interaction and
analysis during internship periods.

Finally, this report is the short and sweet outcome of continuous effort of 3-month
program which will be beneficial for the understanding mechanism of planning.

viii
 TABLE OF CONTENTS

INFORMATION
SHEET ....................................................................................................................... i
TITLE
PAGE........................................................................................................................................................ i
DECLARATION .......................................................................................................................................
.......... iii
BONAFIDE
CERTIFICATE .................................................................................................................................. iv
ACKNOWLEDGEMENT .........................................................................................................................
............ v
ABBREVIATIONS ...................................................................................................................................
.......... vi
ABSTRACT ...............................................................................................................................................
....... vii
TABLE OF
CONTENTS ...................................................................................................................................... ix
LIST OF
TABLES ............................................................................................................................................... xi
LIST OF
FIGURES ............................................................................................................................................ xii
CHAPTER
I ........................................................................................................................................................ 1
INTRODUCTION .....................................................................................................................................
.......... 1

ix
 1.1 About Mahalaxmi Bikas Bank
Limited ........................................................................................... 1
1.2 Organization’s Mission, Vision and Objectives ..............................................................................
1
1.3 Major Markets and Customers ...................................................................................................... 2
1.4 Products and
Services ......................................................................................................................... 3
1.4.1. Products of
MBBL ......................................................................................................................... 3
II) Mahalaxmi Maha Bachat Khata .................................................................................................... 3
IV) Mahalaxmi Grihalaxmi Bachat .................................................................................................... 4
1.4.2. Saving Deposit of
MBBL ................................................................................................................ 4
TERMS AND
CONDITIONS................................................................................................................... 5 Types
of loan........................................................................................................................................... 5
1.4.4 Services of
MBBL ........................................................................................................................... 8
1.5 Organizational Design and
Structure .................................................................................................. 10
1.5.1 Organizational Structure of MBBL( Tikapur
Branch .................................................................... 10
1.5.2 Board of
Directors ........................................................................................................................ 11
1.6 Financial
Structure .............................................................................................................................. 11
1.7. Ownership
Structure .......................................................................................................................... 11
1.7.1 Ownership Structure of
MBBL ......................................................................................................... 12
1. 7.2: Shareholder
Pattern ........................................................................................................................ 12
...............................................................................................................................................................
... 12
1.8 Introduction of Banking
Industry ........................................................................................................ 12
1.8.1 Meaning of
Bank ...............................................................................................................
........... 12

x
 1.8.2 Origin of
Bank ...............................................................................................................
............... 13
1.8.3 History of banking in the
world ................................................................................................... 13
1.8.4 History of Banking System in
Nepal ............................................................................................. 14
1.8.5 Modern
Banking ..........................................................................................................
................ 16
1.8.6 Functions Offered by
Bank .......................................................................................................... 16
CHAPTER
II ..................................................................................................................................................... 21
JOB PROFILE AND ACTIVITIES
PERFORMED ................................................................................................... 21
2.1 Activities Performed In The
Organization ........................................................................................... 21
2.1.1 Opening An
Account .................................................................................................................... 21
2.1.2 Remittance
Department .............................................................................................................. 21
2.1.3 Clearing
Department ................................................................................................................... 22
2.1.4 CLOSING AN
ACCOUNT ................................................................................................................ 22
2.1.5 ISSUANCE OF CHEQUE BOOK AND
ATM ...................................................................................... 22
2.1.6 OTHERS ACTIVITIES
PERFORMED ................................................................................................ 22
2.2 Problem
Identification ........................................................................................................................ 23
2.3 Problem
solved .................................................................................................................................. 23
2.4 Intern’s Key
Observation ..................................................................................................................... 24
2. 4.1: Know Your Customers
(KYC) ....................................................................................................... 24
2.4.2: Information Technology
(IT) ....................................................................................................... 25
2. 4.3: Tools of Current Monetary
Policy ............................................................................................... 25

xi
CHAPTER
III .................................................................................................................................................... 26
CONCLUSION, LESSION LEARNT AND
RECOMMENDATION .......................................................................... 26
3.1 Conclusion .......................................................................................................................................
.... 26
3.2 Lesson
Learnt ...................................................................................................................................... 27
3. 2.1: SWOT
Analysis ............................................................................................................................ 27
3.3
Recommendation ................................................................................................................................
28
REFERENCE
APPENDIX
QUESTIONAIRE

LIST OF TABLES

Table Title Page No.

Table No. 1.1 Customer A/c ............................................................ 2
Table No. 1.2 Interest Rate.................................................................4
Table No. 1.3 FD Interest Rate............................................................4
Table No. 1.4 Loan Facilities...............................................................6
Table No. 1.5 Organization Structure...................................................10
Table No. 1.6 Bord Of Directure...........................................................11
Table No. 1.7 Ownership Structure.......................................................12
Table No. 1.8 Type of Deposit...............................................................17

xii
 LIST OF FIGURES

Figure Title Page No

Figure No 1.1 MBBL Shareholder Pattern ............................................ 12

xiii
 CHAPTER I

INTRODUCTION

1.1 About Mahalaxmi Bikas Bank Limited

Mahalaxmi Bikas Bank was established by renowned professionals with an accomplished

leadership on B.S. 2052 with the main theme of “Strong Bank Successful Co-
operation”. The bank is licensed by Central bank of Nepal as a “B” class national Level
Bank and it is the first development bank to raise the capital fund by 3.07 billion. The
bank has been offering banking services over 500 thousand customers through wide
range of 103 branches and 49 ATM. The head office of the bank is in Durbarmarg,
kathmandu.

The bank is moving ahead with the motto of “ service with Smile” to each and every
group of customers and their satisfaction is bank‟s success. It has been focusing on
prolongation of digital banking to modernize banking services. The bank is always
committed to move forward by implementing prolong long term business practices,
accountable to it‟s regulatory bodies and Corporate Governance.

Bank had been awarded with Best Presented Award(BPA)- 2018 from ICAN for
presenting best financial report among development banks. Similarly bank had also been
awarded with SAFA-2018 in bangladesh for being successful presenting best financial
report.

1.2 Organization’s Mission, Vision and Objectives

MISSION

MBBL mission is to offer safety of deposits and render best services to the customers,
build the best place to work with, provide best and perpetual returns to the stockholders
with the strict compliance to the regulations. The mission will be accomplished by
creating four pillars; INNOVATION, IMPROVEMENT, CORPORATE

GEOVERNANCE AND CULTURE.

1
 VISION

To become “The Most Trusted Bank” to the customers, to the employees, to the
stockholders and to the regulators through the process of continuous innovation and
improvement, strong corporate governance and professional work culture.

OBJECTIVES

The core values or the objectives of the organization mainly are to meet customer
satisfaction through easy and quality service and others are mentioned below;

i) Bringing innovations and customization to meet customer need

and to hold quality of service.
ii) Provide secured future for its internal employees. iii)
Attractive return to its investors. iv) Lower rates for loan
clients.
v) Upholding honesty and sincerity
vi) Strengthen the market shares. vii) Engaged in various social activities fulfilling
corporate social responsibilities.

1.3 Major Markets and Customers

Mahalaxmi Bikas Bank Limited(MBBL)with the main theme of “Strong Bank

Successful Co- operation” expands its services in Tikapur. It has been operating its
business in many places of Nepal since twenty three years. Its major market is viewed to
be every nook and comer of the country so it is extending further more branches in the
various cities in the near future. The various branches recently in operation by the branch
managers are: provides customer-friendly services through it‟s the branches are
connected through Anywhere Branch banking System(ABBS), which enables customers
for operational transactions from any branches.

2
 Table1.1 Customer’s a\c

1.4 Products and Services

As a pioneer in introducing many innovative and marketing concepts in the domestic
banking sector it represents a milestone in the banking history of Nepal with customer
satisfaction considered as focus objective while doing business.

1.4.1. Products of MBBL

I) Mahalaxmi Baivab Bachat Khata : Mahalaxmi Baivab Bachat Khata is designed to

provide one step solution for your convenience.
FEATURES:

i) Minimum Balance: Rs. 5000

ii) Interest rate: link iii) Free DEMAT/ Meroshare Facility for the first

year. iv) Free Mobile Banking Facility for the First year.

v) 50% discount on safe deposit lockers

II) Mahalaxmi Maha Bachat Khata

i) Mimimum Balance:RS. 500

st
ii) Free mobile banking for 1 year
st
iii) Free Debit card for 1 year

3
III) Mahalaxmi Bachat Briddhi Khata

i) Minimum balance:RS 51

ii) Interest Rate:link iii) Free monile banking and DEMAT facility for the

first year.

IV) Mahalaxmi Grihalaxmi Bachat

i) Minimum balance: RS 100

ii) Interest rate: Link iii) Locker facility

iv) ABBS

v) Discounted rates on loan facility

1.4.2. Saving Deposit of MBBL

Table No.1.2 Intrest Rate

Table No. 1.3 FD Intrest Rate

4
Loans

The need for financing various short term and long term venture of both corporate and
retail clients has been best fulfilled by the bank with its large product portfolio. The
various kinds of loans provided by the bank are:
Mahalaxmi Udhamshil Loan

Mahalaxmi uddhyamshil karja is the loan product that is crafted to encourage youths to
actively involve in nation building through involvement in entrepreneurship.

i) Purposes of loan ii)

Asset financing iii)

NTA financing iv)

Advancing financing

v) Non-funded\ traded facilities

TERMS AND CONDITIONS

I. Special Offer: Administrative Fee Cash back

II. Eligibility: Eligibility shall be asper the provision of existing”Karja Tatha Sapat
Sambandhi Niti 2074” of the bank

III. Loan Amount : Minimum 500000 to maximum 30000000.

IV. Interest rate : 8.94%

V. Loan tenure : Term Loan: In case of trading\ service sector business: maximum
upto 10 years.

i) In case of Manufacturing unit: Maximum upto 15 years

VI. Loan processing fee: 1 %

VII. Bank Finance : Up To 80% of FMV of collateral security

Types of loan

Hire Purchase Loan :

Purchase of office equipment, vehicle, machinery etc is possible through our Hire
Purchase schemes.

5
Vehicle Loan

MBBL finance up to 80% of the cost of the vehicle that is new or will be less than 7 years
old at the time of final maturity of the loan. MBBL need is proof of income and reference\
guarantee from customer employer\individual acceptable to us.

Terms and Conditions

i) Registration of the vehicle will be in the bank‟s name.

ii) Bank reserves the right to call for additional Registered Mortgage over land and
building.

iii) First Repayment Date is from the subsequent month of initial drawdown iv)

Repayment is to made in Equal Monthly Installments

Home Loan
MBBL finance up to 60% of the cost of the purchase\construction \renovation of land\
house within municipal boundaries. All MBBL need is proof of customer income and
reference\guarantee from customer employer\individual acceptable to MBBL.
Depending on customer income and customer need, a loan of NPR 500000 to 4000000
can be availed of at a very competitive rate of interest. Repayments are calculated on an
Equal Monthly Installment basis that goes easy on customer monthly budget.

Terms and conditions

i) Property being mortgaged should be located within municipal boundaries of
kathmandu valley and in other residential sector of developing areas within 40
kms from the heart of kathmandu .
ii) As security, the bank shall have the first legal mortage on freehold property
valued by bank‟s approved value with extended value not less than the 100% of
financed amount.

iii) Bank reserves the right to call for additional registered mortgage over land and
building.

iv) Repayment is to be Equal Monthly Installments which will not exceed 50% of the
borrowers‟ net monthly earnings.
6
Education Loan

MBBL finance upto 60% of the cost of tuition and admission.all MBBL need is proof of
customer employer\individual acceptable to MBBL. Depending on customer income and
customer need, anloan of NPR 150000 to NPR 800000 can be availed of at a very
competitive rate of interest. Repayments are calculated on an Equal Monthly Installment
basis that goes easy on customer monthly budget. And the tenor is kept flexible to suit
customer need: customer can take a minimum of 12 months or a maximum of 60 months
to repay. Customer also have an option of prepaying customer loan and all you will
officers will be pleases to provide further information

Terms and Conditions

i) Registered Mortgage over land and building within municipal boundaries.
ii) Property being mortgaged should be located within municipal boundaries and
must have a motor able access.
iii) Monthly net saving in case of self-employed individuals must be 5 times of
EMI.
iv) Repayment period not to exceed borrower‟s balance\tenor of service upto
retirement in case of employees\salaried employees.
v) Repayment is to be made in Equal Installments not to exceed 75% of borrowers‟
net income in case salaried\self employem individuals.

vi) A processing fee of 1% will be charged on the Financial Amount.

Travel Loan

This service of MBBL is not available in Tikapur branch. MBBL finance up to 70% of
the cost of ticket and tour expenses. All MBBL need is proof of customer income and\or
reference \guarantee from customer employer\individual acceptable to us.

Depending on customer income and customer need, a loan of NPR 50000 to 300000 can
be availed of at a very competitive rate of interest. Repayments are calculated on an
Equal Monthly Installment basis that goes easy on customer monthly budget.

7
Agriculture Loan
Agriculture loan is targeted to lower and middle income bracket farmers and agriculture
entrepreneurs and firms and companies commercially involved in agriculture sectors to
fulfill their agriculture requirement.

Terms And Conditions

i) Loan limit: 400000 to 2500000.

ii) Agriculture Loan for registered business firms and companies:
iii) NPR 400000 to maximum as per business requirement and upon business
analysis within single obligor limit as per the provision of NRB Directives.
iv) Loan tenure:
a) For agriculture Overdraft loan or short-term loan, Demand loan, Business Loan:
maximum up to 1 year.
b) For Agriculture term loan for individual and business loan 3 to 5 years.

1.4.3. Loan Facilities of MBBL

Table No 1.4 Loan Facilities

1.4.4 Services of MBBL

“Need centered products are the MBBL product” is basic business philosophy. The
bank has been continuously identifying customer changing needs and preferences,
designing and offering need centered augmented product and services that has met or
even exceeded customer‟s expectation.

8
The innovative products of the bank has not only added extra value and provided high
level of satisfaction to the customers but also produced desire on customer to be
associated with the bank‟s future innovation. The bank perceives product differentiation
and service excellence as an opportunity to prove superior to competitors, and has been
successful in the past and is the source of inspiration to go ahead.

i) Cash withdrawal
ii) Mini transaction report
iii) Mini statement prints
iv) Balance enquiry
v) Payment for purchase of goods\services at the merchant locations (through
POS) vi) Personal identification
number(PIN) change

MBBL SERVICES
i) Access Customers accounts, 24\7 service
ii) Current Account Services
iii) Transfer funds within a group iv) Make payment of
Nepal Telecom bills
v) Online shopping
vi) MMBL remit services
vii) MBBL Utility Payment
viii) Loan Services
ix) MBBL QR Merchant
x) MBBL Smart Banking
xi) ATM/ Debit Card
xii) MBBL Online Fixed
xiii) Mobile Banking Services xiv) Mobile Banking Services

9
1.5 Organizational Design and Structure

This is Organizational structure of Mahalaxmi bikas bank limited, Tikapur branch.

Branch manager is head of the organization. He supervises the employees and takes
major decision. Credit head deals with the loan customers and do documentation. The
ready file is signed by credit officer and branch manager and send to the head office for
the approval. Operation department includes CSD and Teller department. CSD
department deals with the customers perform task of cheque clearing, remittance etc.
Teller department helps customer to deposit and withdraw cash from bank. Operation
head control and supervise CSD and Teller staffs of the organization. Since it is branch
office, all the staffs work with cooperation helping each other.

1.5.1 Organizational Structure of MBBL( Tikapur Branch)

Table No1.5 Organizational Structure

1.5.2 Board of Directors

10
 Table No. 1.6 Board of directors

1.6 Financial Structure

Financial Structure refers to the way the firm‟s assets are financial with. It refers to the
entire liabilities side of the balance sheet. So financial structure is the amount of total
current liabilities, long term debt, preferred stock, and the common equity used to finance
a firm. Bank‟s activities are MBBL lighted in terms of risk and return in light of capital
requirement. Bank has established a culture whereby return on capital needs to be
justified in light of risk involved in each investing and operating activities. In order to
access the adequacy of capital, all major risks like credit, liquidity, etc. are identified,
measured and reported on periodic basis. These are monitored by the bank‟s board and
senior management periodically in addition to the monthly review of annual audit of the
bank.

1.7. Ownership Structure

Ownership structure refers to the composition of the owner‟s capital in the share capital.
It generally comprises of contribution from the promoter shareholders, general public,
institutional ownership and sometimes contribution from the government as MBBL. The
ownership contribution of the MBBL comprises contribution from the promoter
shareholders and the general public.

Promoter shareholders hold 68% of the paid up capital and the rest 38% is from the
general public. The authorized capital of the MBBL is Rs. 6 billion.

11
1.7.1 Ownership Structure of MBBL

Table No. 1.7 Ownership Structure

1.7.2: Shareholder Pattern

From Promotor

From Public
The figure 1.1 MBBL Shareholder Pattern

It means that the promotor have high authority and right the public. MBBL can say that
the promotor have the control over the management, they have right to declare the
B.O.D. and other decision

1.8 Introduction of Banking Industry

1.8.1 Meaning of Bank

A bank is a type of financial institutions that are established under a certain act to
perform monetary and credit transactions. The bank accepts the deposits in the form of
capital and collateral, formulates, and implements monetary and foreign exchange policy
to maintain price and balance payment stability for a sustainable development of the
country. It provides necessary liquidity for promoting the stability of the financial
sectors. It raises funds by collecting deposits from business and consumers through
saving deposit, checking deposit and other deposit products. Besides this, it gives
facilities to business like giving loans to business, housing, saving deposited money,
buying and selling of bonds etc.

It also helps to develop a safe, sound, and efficient payment system. Bank helps in
making regulations, inspection, supervision, and maintaining the sound development of
the banking system. According to the American Law bank has been defined as “Any
12
 Kind of institution offering deposit subject to withdrawal on demand and making loans of
a commercial or business nature is a Bank"

The bank regulation of India defines it as a means of accepting for the purpose of leading
or investment of deposit of money from the public repayable on demand or otherwise
able by cheque, draft or otherwise.

1.8.2 Origin of Bank

Actually, the word “Bank” has been originated from the Latin word “bancus”; Italian
word “Banca” and a French word banque; which all refers to the Bench. Jews, the early
bankers, in Lombardy, used to transact their business at benches in the market place. In
the history of origin of banking in the world, “The Bank of Venice”, was the first, which
was originated in Venice of Italy in the year 1157 A.D. In addition, the first central bank
which was established in 1844 A.D. was “The Bank of England”.

Bank is a financial intermediary accepting deposits and granting loans and also offers the
variety of services like conversion foreign currency into domestic currency and vice
versa, lending money, saving deposits etc. Even if we look at the past, banking concept is
found. In the ancient period, this concept existed, when goldsmiths and the rich people
used to give money to the common people against the promise of safekeeping their
valuable items on the presentation of the receipt, the depositors would get back their gold
and valuables of the paying a small amount for safekeeping and saving.

1.8.3 History of banking in the world

i. Ancient Times: The earliest evidence of banking dates back to Mesopotamia in the
2nd millennium BC, where merchants made loans to traders and farmers. In ancient
Egypt, temples acted as banks where they stored grain, precious metals, and other
valuable commodities. The first recorded use of interest on loans was in Babylon in
2000 BC.

ii. Renaissance Italy: The Medici family established the first modern bank in Florence,
Italy, in 1397. The Medici Bank offered loans to merchants and the wealthy, and also
provided services such as money transfer, currency exchange, and letters of credit.
The bank became one of the wealthiest and most powerful institutions in Europe.

13
iii. 17th-18th century: The Bank of England was established in 1694 as a private bank
to finance the war against France. It was later nationalized in 1946. In the United
States, the First Bank of the United States was established in 1791 to manage the
country's finances and issue currency.

iv. Industrial Revolution: The Industrial Revolution in the 18th and 19th centuries led
to the development of the joint-stock company, which allowed individuals to pool
their money to invest in large-scale industrial projects. This led to the emergence of
investment banks that specialized in underwriting stocks and bonds.

v. 20th century: The 20th century saw the rise of multinational banks, which spread
their operations across the globe. The first international bank was the Bank of
London and South America, which was established in 1923. The introduction of
electronic banking, credit cards, and ATMs transformed the banking industry.

vi. 21st century: The 21st century has seen rapid technological advancements, with the
rise of mobile banking, online banking, and digital currencies such as Bitcoin. The
financial crisis of 2008 led to increased regulation of the banking industry and the
establishment of new regulatory bodies such as the Financial Stability Oversight
Council and the Consumer Financial Protection Bureau.

In summary, the history of banking shows how the industry has evolved over time to
meet the changing needs of society. From simple money lending to the complex financial
services we see today, banking has played a crucial role in the development of modern
economies.

1.8.4 History of Banking System in Nepal

The history of banking in Nepal dates back to the early 20th century, when the first
commercial bank, the Nepal Bank Limited, was established in 1937. Prior to that, there
were only a few informal moneylenders who provided financial services to the public.

The Nepal Bank Limited, which was established with the support of the government,
provided basic banking services such as deposit and withdrawal facilities to the public.

14
However, due to limited resources and infrastructure, the bank was not able to provide
banking services to the entire population.

In the 1950s, the government established the Agricultural Development Bank to promote
agriculture and provide credit to farmers. In 1956, the Nepal Rastra Bank, the central
bank of Nepal, was established to regulate and supervise the banking sector.

In the 1980s and 1990s, Nepal's banking sector underwent significant changes, with the
establishment of several commercial banks, development banks, and finance companies.
The liberalization of the economy in the early 1990s resulted in increased competition
and innovation in the banking sector.

Commercial banks should operate under the Commercial Bank Act 2031, Nepal Rastra
Bank Act 2058. Company Act 2053 and Contract Act 2056. Nepal Arab Bank Limited
(NABIL) is the first bank established in joint investment in Nepal in 2041 B.S. A year
later Nepal Indosuez Bank Limited currently renamed as Nepal Investment Bank Limited
was set up, with passage of time several other joint venture and private bank has been
established.

After the restoration of democracy in Nepal, there has been tremendous development in
banking sector. Rural development banks are formed for all development banks under the
control and supervision of Nepal Rastra Bank. These banks include

i. Eastern Rural Development Bank

ii. Central Rural Development Bank
iii. Western Rural Development Bank
iv. Mid-western Rural Development Bank
v. Far-western Rural Development Bank

Nepal Industrial Development Corporation (NIDC) and Agricultural Development Bank

(ADB) were only two development banks to be established before the enactment of
Nepal Development Bank Act 2052 B.S. After the introduction of Nepal Development
Act 2052 B.S., many development banks were set up. Nowadays it has also been one of
the attractive places for employment, investors etc.

15
Today, Nepal has a well-developed banking system with a mix of domestic and foreign
banks, providing a range of services such as deposit-taking, lending, foreign exchange
transactions, and remittance services. The banking sector plays a crucial role in the
country's economy, providing much-needed financial support to businesses and
individuals.

1.8.5 Modern Banking

Merchants, Goldsmiths, moneylenders are known as the ancient bankers. Development of
modern banking in the 15th, 16th and 17th centuries gradually shifted the Centre of the
world commerce from the Mediterranean region towards Europe and the British Isles,
where banking became a leading industry. During third initial phase of modern banking
development Industrial Revolution was developed, which demanded a well-developed
financial system. Modern banking was developed to provide new methods of making
payments and credit available, which were required as economy of various countries
adopted mass production.

At previous times, banks functions were limited. They only accepted deposits of money
or valuables for safekeeping and verifying coinage or exchanging one jurisdiction‟s coins
for another‟s. Various banks were developed as modern banks such as Medici Bank of
Italy and Hochstetler Bank in Germany.

Now bank has become a known place for every people and it also offers wide variety of
services than before.

1.8.6 Functions Offered by Bank

There are various functions provided by the bank. They are as follows:

Deposit function

Accepting deposits is the primary function of the bank. The most important fund of the
banks is deposits. Without deposits, it would be difficult for the bank to invest high
return sectors. The main objective of the bank is to collect deposits in as lowest cost of
fund.

Types of deposit

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Deposit is amount taken from the customer/amount deposited by the customer. Accepting
deposit is the primary function of the bank. Different accounts (saving, current, fixed,
margin call account) are used to collect the amount. The deposit can be interest-bearing
and non-interest bearing. Deposit is the primary source of lending. Deposit is dominant
liabilities of the bank. Deposit is assets of the customer and banks have to repay back to
the customer whenever the customers demand.

The deposit can be categorized into different categories based on the currency, collection,
time, interest-bearing and nature as follows.

Table No. 1.8 Types of deposit

Basis Types

On the Basis of Currency 1) Local Currency Deposit

2) Foreign Currency Deposit

On the basis of Interest Bearing 1) Interest Bearing Deposit

2) Non-interest Bearing Deposit

On the basis of Tenure/Time 1) Demand Deposit

2) Term Deposit (Time Deposit)

On the basis of Collection 1) Recurring Deposit

2) Non-recurring Deposit

On the basis of Nature 1) Current Account Deposit

2) Saving Account Deposit
3) Fixed Account Deposit
4) Margin Account Deposit
5) Call Account Deposit

1. Current Account Deposit – The depositors of such deposits can withdraw and
deposit money whenever they want any number of times. It is non- interest

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 bearing deposit mainly used by big business firms and business people because
they have to make payments and accept payments many times in a day.

Features of Current Deposit

i. There is no restriction on a number of the transaction during any period of time. ii.

Bank does not provide interest in the current deposit.

iii. The low interest-bearing account holder of the current account can be given the
overdraft facilities after a special or specific agreement between bank and account
holder.

2. Saving Deposit – Saving account is interest-bearing [] account suitable for low and
fixed income and salaried people. There are restrictions on the number of withdrawals
that can be made through a saving account and hence this type of account is not suitable
for businessmen. No overdraft facility is offered on a savings account. Saving account
holders are given a cheque book facility.

Features of Saving Deposit

i. The bank pays low interest in saving a deposit. ii. There is a restriction in the number
of the transaction during a state period of time. iii. The main purpose of such account is
to save money of customer for a short period.

3. Fixed Deposit – This deposit is also called long term deposit because the duration of
the deposit is normally more than one year. The bank pays high interest for the account
holder. The account holder cannot withdraw money before the maturity period. One-time
lump-sum deposit is made by the customer for a fixed period of time.

Features of Fixed Deposit

i. The amount cannot be withdrawn before its maturity period.

ii. Bank provides the high-interest rate in fixed deposit. iii. Mostly used
by senior retired and pension holder citizen.

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4. Call Deposit – Call deposit is a hybrid of current deposit and saving a deposit. It is
an interest-bearing deposit wherein the rate of the interest depends upon the amount.
5. Margin Deposit – Margin deposit is a non-interest bearing deposit. No cheque is
issued in margin deposit.

Providing loans

This is the other function of a bank. It provides loan to a customer, company or

institution. Bank is able to gain benefit by giving loans and charging them with some
amount of interest rate to a customer as per the law and banking policies, terms and
conditions. It provides loans by accepting the security of a debtor.

Credit function

Bank provides credit to the deficit customers such as hire purchase loan, real estate loan,
leasing of the fixed assets, working capital loan and other long-term loans. The interest
rate charged to the loan amount and the interest provided to the depositor‟s difference
leads to the profit of the bank.

Payment function

The bank provides various payment facilities to the costumers to make the economy
efficient and effective. If the payment facilities were not developed it would be difficult
for the costumers to transfer the money from one place to another. Some of the payment
instrument is as cheques, bank overdraft, online various banks also provide payments.

Trust function

The most important function of the modern bank is to maintain credibility towards the
depositors as well as towards investors. If the bank fails to maintain the credibility, it
becomes difficult for the bank to attract depositors as well as investors to purchase.

Investment function

Bank uses the surplus amount of money at the profitable area where the return on
investments is high. Bank also invests a huge amount of money in government securities
and bonds, as it is a 0% risk free investment.

19
Cash management function

It is necessary for the bank to manage the cash collection and cash disbursement to retain
its position in the markets well as credibility. If the cash management leads to deficit
rather than surplus it would be difficult for the bank to manage its environment
effectively.

Insurance function

Another important function the modern banks play is insurance function. Bank provides
loans and advances to various sectors as a result of the assets or the loan amount should
be insured and various collateral must also be taken under bank‟s eye. In case of
providing loans to purchase a car, it is necessary that the vehicle is insured so that the risk
of not recovering the money is low.

Underwriting function

It is necessary for each bank to issue public shares in the marketplace. Banks has the right
to under right the various securities such as common stock, preferred stock, or
debentures. It is necessary that legal bank be listed in the stock market so that the
interested investors can invest a huge amount of money in the bank by purchasing
various securities.

Brokerage function

A modern bank also plays an important role as a broker for the necessary clients. Banks
earns a non-operating income acting as a broker. As a broker banks helps the client to
purchase and sale various securities of the banks as well of different banks. Banks may
charge some percentage of commission or may even some amount of rupees with
difference between the selling and purchasing price.

CHAPTER II JOB PROFILE

AND ACTIVITIES PERFORMED
2.1 Activities Performed In The Organization

In MBBL worked in two different departments i.e. CSD and remittances. As a services
oriented company the major responsibilities MBBL to give better services to the clients
20
promptly on their demand. I was mainly given the responsibility of service related issues
under the supervision of the respective officers. In the period of my internship I helped
the organization by sharing the workload of the respective officers. The working
environment was very comfortable to work in with friendly staffs which made the work
easier. The major responsibilities given to me are as follows.
i) Opening an account
ii) Closing an account
iii) Issuance of cheque book and ATM
iv) Others

2.1.1 Opening An Account

The first I had to know was about the criteria of opening the account of a new customer.
The responsibility of the customer service starts with opening of new account of the new
customer informing them about the facilities available in the organization. I learnt about
the document required to open a new account. By opening an acoount bank bridge its
customers to avail the facilities provided by the bank.

2.1.2 Remittance Department

Remittance can be defined as the transfer of money from one place to another that may
be from bank or from country to country. The department of remittance deals with the
management of the remitted money. Which is sent by the migrant workers from abroad
or within the country as well. MBBL receives remittance through swift code. MBBL is
the pioneer in the field of retail money transfer business with over 26 years customized
services delivery experience in the field.

2.1.3 Clearing Department

In this department customers bring checks of different bank and they fill a voucher to
credit their account by the amount specified in the check and by debiting the amount in
the check of the specified bank. After receiving different checks they are given the
specific OBC number and recorded in the register and later they are recorded in the
computers as well and after all the checks are recorded the final print out is printed, 3
pages of each banks are printed and vouchers are attached with single page of the specific
21
bank and 2 pages are attached with the checks and the checks are passed to the next step
where they are checked that all the checks and vouchers are in order or not and then
again they are entered in the excel sheet in the next step and final print out is made.

2.1.4 CLOSING AN ACCOUNT

I also had the responsibility to close the account of the customers who wants to close his\
her account in the bank following the procedure strictly. The procedure for it was:

i) Need of the within application by the account holder ii) Return

of the cheque book and the ATM provided to the customer iii) Calculate the
require charges according to the type of the account opened iv) Return
of the rest amount to the respective customer
v) Finally it is updated in the system and the form is filed in closed account file.

2.1.5 ISSUANCE OF CHEQUE BOOK AND ATM

The cheque book and ATM had its own respective register which was requires to be
mentioned along with the signature of the customer in the register. Before printing the
cheque book,requisition should be complete containing title of account type, a\c number,
number of leaves to be printed and signature of the a\c holder.

2.1.6 OTHERS ACTIVITIES PERFORMED

i) Helping customers to fill up the forms or vouchers ii)

Receiving phone calls iii) Cheque, statement
printing and scanning iv) Answering to the customers
queries
v) Filing documents
vi) Updating KYC
vii) Preparing register of petty cash

2.2 Problem Identification

Problems and organization are non-detachable terms. In performing day to day activities
of the organization, one needs to tackle with various problems and challenges. While

22
dealing with such problems, appropriate managerial skills need to be used to solve the
problem in the effective and efficient way.

During the internship period, the following problems were identified:

i) problems related to the misunderstanding of the customers ii)

problems related to the change of rules and regulations iii)
Problems related to the mistakes due to the error in the system
iv) Problems related to the non functioning of various services
v) Problems related to the non clarity of information
vi) Problem related to the service provided and mistakes done by the other
employeeS

2.3 Problem solved

The internship period I did was short which was not enough for learning everything we
need to. Though it was short but I tried my best to take the optimum advantage of this
period to know the things to its surface in every department. The staffs were not able to
guide sometimes as they used to get busy with their work and at those times I could not
get the answers of my queries that I had. Being the part of bank as intern I cannot open
up everything I know about the bank due to the oath of secrecy and confidentially. I was
given the chance to work in CSD and load department of the bank. I tried to solve the
basic problems of the customers and others as well when other staffs were busy,
Addressing the customer‟s queries
i) Giving details of the available services to the consumer's for their flexibility
ii) Filling up the account opening forms, vouchers or forms for remittance.
iii) Solving problems related to ATM or PIN
iv) Problems related to reconciliation
2.4 Intern’s Key Observation
The things that I was able to observe in this bank are as mentioned below:
i) Laborious, helpful and cooperative member
ii) Most of the customers are satisfied with the services provided. iii) Good
return to the shareholders. iv) On time disbursement of loan.
v) Involved in social activities.
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 vi) Quick remittance from any remit.

2.4.1: Know Your Customers (KYC)

Nepal Rastriya Bank(NRB) has advised banks to follow a „KYC guidelines‟, wherein
certain personal information of the account- opening prospect or the customer is
obtained. The objective of obtaining KYC information is to enable the derived from
criminal activity or for financing terrorism. Identification of customers will also help to
control financial frauds, identify money laundering and suspicious activities, and for
scrutiny\ monitoring of large value cash transactions. Money laundering refers to
conversion of money illegally obtained to make it appear as if it was earned from a
legitimate source. Money laundering is being employed by launderers worldwide to
conceal criminal activity associated with it such as drugs\ arms trafficking, human
trafficking, terrorism. All crimes that produce a financial benefit give rise to money
laundering.
Bank have to true identification of its customers. This is also in the interest of customer
is a very critical process with a view to protect the customer interests by preventing from
fraudsters who may use the name, address and forgo signature to undertake illegal
business activities, encashment of stolen drafts, cheques, dividend warrants, etc. This also
helps to safeguard banks from being unsuspectingly used for the transfer of deposit of
funds derived from criminal activity or for financial terrorism. Identification of customers
will also help to control financial frauds, identify money laundering and suspicious
activities and for scrutiny\ monitoring of large value cash transactions.

2.4.2: Information Technology (IT)

It has helped the banking industry to deal with the challenges the new economy poses.
More than most other industries, financial institutions rely on gathering, processing,
analsing and providing information in order to meet the needs of customers. Given the
importance of information in banking, it is not surprising that banks were among the
eariest adopters of automated information processing technology. Technology has
opened up new markets, new products, new services and efficient delivery channels for
the banking industry

24
2.4.3: Tools of Current Monetary Policy
Monetary policy impacts the economy and the price level through various channels. The
process by which monetary policy decisions are transmitted to the real economy is called
the monetary policy transmission mechanism. This chain of cause and effect linking
monetary policy decisions with the price level starts with a change in the official interest
rates set by a central bank exercises major influence on the money market and may steer
the prevailing money market rates. Changes in these rates, in turn, impact on other
interest rates.

CHAPTER III
CONCLUSION, LESSION LEARNT AND RECOMMENDATION
3.1 Conclusion
The internship period was very fruitful which shows the face of real life job experience. I
felt it to be quite effective to enter in the world of banking institutions. The internship
period has taught me how MBBL can implement the theoretical knowledge in our
practical life. I too felt on-the-job training that MBBL faced more profitable and practical
rather than off-the-job training only which is monotonous and forgetful. MBBL learnt
interpersonal skill, communicational skill and technical skill that helped me to build my
knowledge in a broad way. The interpersonal skills helped us to interact with the various
types of customers and their various problems. The negotiation skills also got increased
developing the softness and being more formal while communicating with the people or
clients. The positive attitude also got developed while dealing with different nature of
customers.

25
The importance of a friendly environment that makes working place even better and
enjoyable giving all the members an opportunity to know each other and share the ideas
they might have despite a hierarchy. Learnt about general activities that are performed in
customer service department like opening of account, closing of account, issuing of
statements to the customer, filing, recording, etc. Able to handle problems and queries
related to walk-in and existing customers. Learnt how to deal with customers, senior staff
members and co-interness MBBL also learnt the technical skills to operate computer
system, ATM machine, photocopy machine, fax machine, scanner, printer, ECC scanner
and many more. There must be a two way effective communication with the customers
so as to satisfy them with the services.
Therefore all these skills are gained through internship which motivated for the better
performance with developed personality. Interns were told timely to manage resources as
much as they can because the more the resource saved the more efficient the organization
becomes. The birth of professional is directly proportioned to saving of resources and
energy which was yet another topic that was learnt during the time duration of internship.

Saving resources mot only means saving of physical properties but also saving of time.
Communication with the related officer and customers was the major targeted but within
limited time but giving out the best information with positivity. Communication is the
major tool that make target come closer with more benefits during the journey. Not only
communication skills were learnt but the best communication means were used to flow
information within organization be it printing in a network or simple flow of information
within organization using telephones. From opening accounts of customers in different
schemes to providing information about different schemes and analytically determining
which scheme best matches their requirement, various skills were developed along with
feel of social responsibility were developed.

3.2 Lesson Learnt

The organization is well enough but there are some drawbacks as nothing can be perfect.
So, here is SWOT Analysis of Mahalaxmi bikas bank recover the limited drawbacks and
to make it better and accessible:

26
3.2.1: SWOT Analysis
SWOT Analysis provides a comprehensive insight into the company. SWOT Analysis is
a useful technique for understanding company Strenghts and Weaknesses, and for
identifying both the Opportunities open to company and the Threats company face.

STRENGTH

i) innovation ii) Loyal customers iii)

Reduced labor cost iv) Existing
distribution and sales neworks
v) High profitability and revenue

WEAKNESS
i) Future profitability ii) Competitive
market iii) Changing strategy
of stakeholder iv) No advertisement
on media THREAT

i) Government regulations ii)

Tax changes iii)
Increasing costs iv)
External Business Risks
v) Increase in Micro Finance

OPPORTUNITY
i) New Acquisition
ii) Growing Economy
iii) New Markets iv) Venture Capital

By analyzing the SWOT Analysis here is my some feedback towards the organization.
i) Increase the advertising media and change the holding board making it noticeable
and attractive.
ii) To extend its branches to the remote areas to mobilize the resources.
iii) Increasing investment towards the new emerging business as per the present
scenario of the state.

27
 iv) Enhancing the ergonomics for the staffs and providing them better working
environment reducing the pressures.
i) Increasing effective trainings to the staffs for professional development so than
they can enhance their efficiency towards the customers and their works.
ii) Various programs to be conducted so as to attract more people towards the
banking services and its facilities.

3.3 Recommendation
i) The University can incorporate the internship program with a longer time period
so that it would help to boost the skills of student and may provide them with
more learning opportunities.
ii) The University can be suggested to focus more on on-the-job training then theory
classes.

iii) The college can be suggested to design the courses which will make the student
more updated with the latest technology.

College should try to promote the strength of the student and the course they are
providing to the students so that internee are assigned intern as per their capability and
strength.

28
 REFERENCE

Bank and Financial Act 2006

Harrington, S.E., Niehaus, G., & Niehaus, G., Risk Management and Insurance, New

Delhi: Tata McGraw Hill.

https://www.facebook.com/mahalaxmibikasbank/

https://www.mahalaxmibank.com/

https://www.mahalaxmibank.com/branches

Koch, W.T., & MacDonald, S. S., Bank Management, New Delhi: Cengage Learning.

Koirla, P., Essentials of Commercial Bank Management, Kathmandu: Ekta Books.

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APPENDIX

30
31
 QUESTIONAIRE

Q.N.1 Does the bank provide services within the time promised?

Q.N.2 Do the employees gives appropriate solutions to problems?

Q.N.3 Does the bank errors and mistakes correct it's promptly?

Q.N.4 Does the employee give your prompt services?

Q.N.5 Are employee are always search for solution?

Q.N.6 Does the employee always search for solution?

Q.N.7 How is the friendliness and courtesy of employees?

Q.N.8 Do you feel safe in your transaction with Nepal Bank Limited?

Q.N.9 Does the employee of Nepal Bank Limited?

Q.N.10 Does the Nepal Bank Limited Have your best interest at hearts?

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