Visa Classic Credit Card

BANK Mr Binod Pyakuryal Introduction: The term 'Bank' for common people, in our context, is an institution where people deposit their savings in order to earn interest and borrow money so that they can run their business. However, in modern society bank has tremendous role in day to day life. It is the heart of whole financial system. The word bank originated from Latin word "banco", than means bench in English. Group of people sitting on the "bench" and having monetary transactions later on converted into the bank. Concept of modern banking came to existence in 1157 AD after establishment of "Bank of Venice" in Italy. Likewise banks were established in 1407 in Holland and in 1694 in England. A government office named "Tejarath Adda" used to provide some limited banking facilities like deposit and lending, only to government staff before modern banking was introduced in Nepal. Likewise there were group of merchants, who would sit around "Ason" a place in Kathmandu, providing currency exchange facility Indian currency to Nepali currency. They were also a type of money lender somehow meeting the local credit demand. As far as modern banking is concerned, it was introduced in 1937 AD, by the establishment of Nepal Bank Limited. It is virtually a largest commercial bank in Nepal have more than two hundred branches in 67 district and more that 24 billion deposits base, which is approximately on third of total deposit mobilised by commercial banks. To date there are 13 commercial banks, two development banks, four rural banks and more than 44 finance companies in Nepal. More than 40 cooperative organization and non-government organisations are providing limited banking facilities to the people. General Function of Commercial Bank There are some technically well equipped joint venture banks in Nepal providing advanced banking like SWIFT service, Credit cards facilities to their client. On the other hand some banks fully or partly owned by government and by private sector, which can be said semi-advanced in terms of recent modern technology have been carrying traditional banking as well. However, all these banks are common in the sense of general functioning of commercial banks. Among these general functions borrowing and lending and remittance are main. Besides, advisory functions, agency functions, letter of credit and guaranty services, foreign exchange, bill collections and miscellaneous other functions etc. are carried by commercial banks. However, an attempt has been made here to describe lending and borrowing and remittance services as well provided by commercial banks in Nepal. Borrowings Commercial bank has to borrow from the people so that they can lend it to others. The process is generally identified as deposit mobilizations. For this they encourage people to save by offering modest interest to their savings. In order to mobilize deposit, commercial banks have devised different kinds of accounts for example saving, fixed and current accounts. Any Nepali or foreign individual, institutions and firm etc. can operate these accounts if they are ready to respect the rules and regulations of concerned banks. Saving A/C This account has been devised to small savers. The prevailing interest offered by commercial banks ranges 6 to 7 percent in this account. Initial amount required to open accounts varies from 500 to 15000 NRs. After opening the account one can deposit any sum of rupees at his convenience. But bank pays the interest only up to the NRs 2.5 millions balance limit. On the other hand there is weekly withdrawal limit also. One can not withdraw his deposit without properly notifying the concerned bank in case of exceeding the weekly withdrawal limit. Otherwise he will be charged penal interest. To open saving account - citizenship certificate is required in most cases. Some banks may ask recommendation from account holder also. After the formalities are over one is provided a chequebook and a passbook. Accounts may be maintained in the name of a minor but only guardians can operate. Likewise there is a provision of joint account also. Illiterate, who does not sign his/her name can also maintain an account in commercial banks like NBL and RB Bank. They are provided passbook with attached photographs and their thumb-print is taken as specimen signature. In case of withdrawing money they themselves have to appear in the concerned bank where they are provided a debit voucher in which they give their thumb print in stead of signature. This way payment is made each time only in their presence and consent. Fixed Deposit This account is maintained for fix period that is why it is identified as time deposit. The amount deposited in this account is locked till the maturity date. But interest is offered in time interval say every after three months. A receipt is provided to the owner of account as evidence, where the amount deposited, maturity date and name of Account holder etc are mentioned. One neither can redeposit nor can withdraw money from this account till maturity, but he can maintain many accounts at his own will. In emergency, account holder can demand loan against his receipt, which should not exceed 90% of the sum deposited. In this case the bank charges two percent higher interest than that of offered. The tenor of this account is 3 months, 6 months, 9 months, one year and two years or above. The interest, offered in this account, is much attractive than that of saving accounts. Formalities as well are very much same like saving accounts, whereas cheque book is not provided to customers. For those, who do not sign, a photograph is attached in the receipt given. Demand Deposit/Current Deposit This account is virtually designed for those who are involved in business. In this account there is no limit for withdrawal. Account holder can demand any sum of money any time if his balance allows. This is why this account is called demand deposit. No interest is offered in this account. For the firms, or business houses, registration of firms and tax clearance certificates etc. are required for operating an account. For all these previously mentioned accounts, the client has to fill the form and signature specimen card provided by the concerned bank. The signature of the client should always tally with the signature maintained in the specimen card, otherewise bank would not be liable to make payments. Lending The deposit accumulated from the various sources is to lend to those who demand for credit. Banks charge interests on lending which is rather higher than that of interest offered on deposits. The difference between the rate charged and offered is the profit of bank. Banks do facilitate their clients by providing various loans. Among them are as follows: Funded loan, loan against gold & silver, loan against government securities, fix deposit and shares. Pledge loan overdraft loan. Hypothecation. Hire purchase loan. Fixed loan. Working capital loan. Project Loan. Micro credit & agriculture loan. Industrial loan. Advance on credit, importers loan. Export credit. Pledge loan. Contract loan. Loan against Bill for collection etc. Commercial banks are profit making organizations so they invest only when they are assured the loan would be repaid in time. For this they ask for mortgages as security so that in case of denial of payment they would recover the loan from the divestment of the mortgages against loan. That is why the applicant has to under go all the legal procedures demanded by the concerned bank. For instance he has to make proper and authorised valuation of the property being mortgaged, he has to fill the bonds of the banks, ownership certificate of properties or land (lal purja), and tax clearance certificate have to be submitted. Nepal Bank Limited and Rastriya Banijya Bank have been providing loan against gold and silver to their customers. This is the easiest form of credit available in Nepal. One simply has to deposit his/her gold ornaments in the bank where he/she can get up to sixty percent of the value of his belongings. His/her belongings are kept in bank as securities, the day he/she clears his/her due gets his ornaments back. Credit is provided against Govt. Securities (like development bonds) and fix deposit receipt. For fix deposit receipt 90% of the deposited amount can be drawn as credit and the rate of interest charged would be usually 2% higher than that of offered in the receipt. As far as the loan against shares of different companies is concerned banks consider only face values of the shares offered, not prevailing market value. Pledge loan and hypothecation loans are some specified credit in which bank may not demand landed properties etc. in spite one can mortgage his/her trading objects such as goods of the retail shop, food grains stored in his own godown etc. Similarly in hire purchase the object to be bought is the securities against loan. For example if a bus is bought under hire purchase, itself is the securities. The day the loan is recovered ownership is transferred. But in some cases bank may demand extra properties for securities. Overdraft is a type of which is categorised as trading loan. One can demand this loan for enhancing his/her firms, shops and stores and industries. Working capital loan is the loan, which is demanded to run the industries and business. All these previously mentioned loans are usually short-term loan. Fixed capital loan, project loan and industrial loan can be both medium and long term loan. Importers loan, export loan, trust receipt loan and advance on credit are very much related to export import business and letter of credit business. Agro loan, Priority sector, Micro Credit These are loans in which in most of the cases only N.B. Ltd. and R.B Bank are very much involved. Micro credit is provided only to the women who are rather poor. This credit is financed without securities virtually in-group guarantee of the concerned women. Like wise priority sector loan also is nearly similar. All these loans are provided in order to uplift the status of poor. These credits can be categorised as development activities of commercial banks under Government’s strict supervision. Under priority sectors small credit is catered to people in which small entrepreneurs, farmers can be benefited. Loan for vegetable farming, small cottage industries, hatcheries and poultry farming etc. are provided in these categories. Remittances Transfer of payments from one place to another can be called remittance. Inward bill collection, outward bill collection, collection of cheques and bills and draft and telex transfer, are examples of remittances. Collection Cheques of different banks are collected in one bank and the payment is settled through clearing house (NRB). For example if a person “A” gets a cheque of other bank in which he has not maintained an account, in lieu of cash payment from his client, he renders it into his bank endorsing to collect the sum into his account. The bank makes the settlement and the amount is deposited into the person “A”’s account. For this the bank charges some commission as service fee. Draft and Telex Transfer Transfer of money from one place to another is done through draft and telex, which is considered rather safe. If one has to carry a huge amount of money from Kathmandu to his place say Ilam, it is advisable to carry a demand draft instead of money with him. He can demand draft say from Newroad Branch of N.B.Ltd. for Ilam Branch of N.B.Ltd. after depositing his sum. Draft is a paper note rendered by the bank in lieu of cash, which cashable only on the branch on which it is drawn for. Similarly the person on whose name the draft is drawn can only withdraw money. So even if in case of missing the money, it is safe as the draft is worthless for those who may get it. Telex transfer is more or less the same. However, the sender does not get any token of payment instead the money is directly deposited to the payees account via telex. Likewise one can transfer money into the country from abroad through agency banks. That means one can transfer money, from Hong King American Express Bank for example to N.B. Ltd. Dharan branch in his own account. Credit Cards Credit card facility has being provided by some joint venture banks (Nabil, Standard & Chartered and Himalayan Banks) in Nepal. And there are number of establishments such as departmental store, retail shops medical stores, hotel and restaurants etc. happily accepting credit cards in Kathmandu. MAJOR BANKS OF NEPAL Name of Bank Nepal Rastriya Bank Nepal Bank Limited Rastriya Banijya Bank Himalayan Bank Nepal Arab Bank Nepal SBI Bank Everest Bank Bank of Kathmandu Gorkha Development Bank Nabil Bank Kumari Bank Laxmi Bank Machhapuchhre Bank Nepal Investment Bank Lumbini Bank Standard Chartered Bank Telephone 14439925 14222315 14255928 15535579 14227181 14225326 14245782 14231557 14255650 14226785 14232113 14444685 14443681 14242530 14243165 14783753 Location Baluwatar New Road Bishal Bazaar Pulchowk Kantipath Durbar Marg New Road New Road Putali Sadak Kantipath Putalisadak Hattisar Putalisadak Putalisadak Durbar Marg Naya Baneshwor Standard Chartered The historical ties between Nepal and UK dates back to centuries. The role of our brave Nepalese brethren who worked for the British Army and those who still work is of paramount importance in this bilateral relationship. We humbly pay our respect and tribute to all our brethren and their family. Standard Chartered Bank Nepal Limited (SCBNL) – the erstwhile Grindlays Bank, has been in operation in Nepal since 1987 when it was registered as a joint venture operation. Today the Bank is an integral part of Standard Chartered Group that has 75% ownership with 25% shares owned by the Nepalese public. The Bank enjoys the status of the largest international bank currently operating in Nepal. The Bank’s relationship with the British Gurkha family at the institutional and individual level is over 17 years old now. We respect and value this relationship that has been developed & cultivated over the years. It is our sincere belief that it is important for the Bank to revisit its products and services from time to time in order to provide an integrated package to our brethren and family. Hence, the products and services that are detailed herein have been exclusively packaged to suit the needs of our brethren. Why Standard Chartered Bank Nepal Limited      We are the largest international Bank in the country with a Global Network in 56 countries. We have pioneered the modern banking in Nepal. We offer an array of products and services to provide complete solution to your financial needs. We ensure complete security of your funds. We maintain strict confidentiality of your banking details. Our Products & Services Privilege in Account Opening (Exclusively for British Gurkha Soldiers, Pensioners and Widow Pensioners) Account Maintenance    Account maybe opened with a minimum balance of NPR500. No ledger fees would be levied. Interest on Savings Account will be paid on the minimum balance of the month provided the minimum balance is as follows: Kathmandu: NPR 25,000, Pokhara, Biratnagar, Bhairawa & Hetauda: NPR 10,000, Dharan & Butwal NPR 5,000.    No charges on inter-branch transactions Free Cheque book & ATM cards. 50% charges waived for all counter services i.e. issuance of drafts, travellers cheques, balance certificates, stop payments etc.     50% charges waived for fund transfers to other banks. Other banks’ charges will be levied on an actual basis. Preferential rate of 5 paisa more than the published rate on foreign currency exchange. 25% discount on locker charges Free SMS banking Grameen Prathamik Karza (Exclusively to pensioners)     To support Income generating activities. Advances up to 90% of 36 months’ pension repayable in up to 60 months. (maximum Rs 1,000,000) Attractive interest rate and other fee structures Quick turnaround time and simple application procedure. Home Loan        Finance from Rs 500,000 to Rs 10,000,000 for purchase of building, house construction and refinance. Finance from Rs 300,000 to Rs 3,000,000 for renovation and extension of building Up to Rs 7,500,000 for plot purchase Advances up to Rs 5,000,000 against property (land/building) repayable in 12 years for any purpose Maximum Loan Repayment in 18 years. Attractive interest rate and other fee structures Quick turnaround time and simple application procedure Auto Loan     Finance up to 90% of the vehicle cost. Attractive interest rate and other fee structures Loan Repayable in equal monthly instalments over a period of 12 months to 84 months – as per your convenience. Quick turnaround time and simple application procedure. Visa Classic Credit Card          Easy to apply. Wide acceptance in Nepal and India Flexible payment option – 5% to 100% 100% Cash Advance facility both in India and Nepal No need to open an account 24-hour service at ATMs Additional Cards to spouse & children with specific spending limit. Transfer purchase of Rs 5,000 and above to the instalment account and enjoy interest rate of as low as 0% p.a. Utility Bill Payment at nominal charges. (for Kathmandu Valley only)    Free SMS Service Option to make payment through ATM-Cash deposit/account transfer Benefits of Reward Scheme Loan against Cash & Near Cash Securities Against the security of account balance held with us (Current/Savings/Fixed), Government Bonds, Standby letter of Credit and Guarantee from overseas banks.       Loans can be availed in the form of Revolving/Structured Demand Loan Trade Finance facilities. (Guarantees and Letter of Credit) For personal/business capital needs Finance from Rs 50,000 to Rs 15,000,000 subject to a maximum of 95% of face value of the security Most competitive interest rate Simple application process & documentation requirements. Branch Directory Head Office Naya Baneshwor, Kathmandu Tel: 977-14781002, 4783753 Fax: 977-14780762 SWIFT: SCBLNPKA Lalitpur Branch Jawalakhel, Lalitpur Tel: 977-15540566, 5540544 Fax: 977-15523266 Lazimpat Branch Lazimpat, Kathmandu Tel: 977-14418456 Fax: 977-14417428 Biratnagar Branch Main Road, Biratnagar Tel: 977-21528983 Fax: 977-21528982 Dharan Branch Buddha Marga Dharan, Sunsari Tel: 977-25520505, 530480 Fax: 977-25530981 Pokhara Branch Lakeside, Pokara Tel: 977-61522805, 521746 Fax: 977-61520318 Bhairahawa Branch Burmeli Tole, Bhairahawa Tel: 977- 71524029 Fax: 977-71524039 Butwal Branch Milan Chowk Butwal Municipality – 11, Rupandehi Tel: 977-71546832 Fax: 977-71546882 Hetauda Branch Bank Road, Hetauda Tel: 977-57523019, 524972 Fax: 977-57525695 BPKIHS Counter Dharan, Sunsari Tel: 977-25530481 24-hour ATM sites Kathmandu, Lalitpur, Pokhara & Dharan Naya Baneshwor SCBNL New Road Bishal Bazar Shop #88 (Opp. Hotel Classic) Lalitpur SCBNL, Jawalakhel UN Complex, Pulchowk Pokhara SCBNL, Lakeside Hotel Snowland, Lakeside Park N’ Shop, Chipledhunga Thamel Kathmandu Guest House Arcadia Building (Near Ying Yang Restaurant) Lazimpat SCBNL Kamaladi Kasthamandap Bazar Dharan BPKIHS