ANALYSIS ON REMITANCE SERVISES OF

HIMALAYAN BANK LIMITED

An Internship Report

Submitted by:

Submitted to:

Office of the Dean

Faculty of Management

Submitted in

Partial fulfillment of the course requirement for the degree of Bachelors in

Business Administration (BBA)

1

Campus Chief

Name:

Signature: _________

Date:

Acknowledgement

This report has been prepared as a Partial fulfillment of the course requirement for the degree of

Bachelors in Business Administration (BBA).The primary objective of this case study is to

analyze the Remittance service of Himalayan Bank Limited situated at Thamel, Kathmandu

Nepal.

2

I would not be able to justify my work without acknowledging the staffs who have contributed

significantly for the completion of this report.

First of all I would like to thank Mr.Ishwor Karki (HR manager) for providing me the

opportunity to work in their prestigious organization as an intern.

I would like to extend my sincere thanks to all the staff of remittance promotion

department especially Ms. Supridi, Mr. Manish Raj Pant, for there help and support. I would also

like to thank Mr. Manoj D Shrestha, for providing me the information.

At last, I thank once again to the entire member and the organization that have supported me for

the completion of my intern.

TABLE OF CONTENT

ABSTRACT

ABBREVIATION

CHAPTER I. INTRODUCTION

1.1 Background

1.2 Objectives

1.3 Methodology

Organization selection

Placement

3

Duration of internship

Activities performed

1.4 Limitation

CHAPTER II.

2.1 Introductions to Banking Sector

2.2 Development of Banking Industry in Nepal

2.3 Introduction to Commercial Banks

2.4 Functions of Commercial Banks

2.5 Introduction of the organization.

2.6 Capital structure

2.7 Equity participation

CHAPTER III

ABSTRACT

This internship report, which is about the “Remittance service of Himalayan Bank Limited”, has

been prepared for the partial fulfillment of the degree of Bachelor in business administration

(BBA) for the finance and banking, which is one of the specialization course in BBA of

Tribhuvan University.

This report is divided into five chapters; the first chapter of the report contains the information

regarding the study, I.e. its background, objective, methodology, and limitation.

4

ABBREVIATION

5

1. Introduction

1.1 Background

The internship program has been designed by Tribhuvan University for the partial fulfillment of

the degree of Bachelor in Business Administration (BBA) for the course of Finance and

Banking. According to the designed pattern of this program, students need to complete internship

for the period of 8TH weeks and prepare the report for the fulfillment of degree.

6

This report has been prepared as per the internship requirement of Tribhuvan University, School

of management in the partial fulfillment of BBA degree. As a part of the University curriculum,

the internship course carries six credit hours.

1.2 Objective of the study

The main objective of the study/internship program is to relate the theoretical knowledge with

practical one. The study also helps to gain professional experience in the real work environment.

Beside this, the other part of the objectives is to develop internee’s skill on communication,

decision making, confidence buildup, etc

The main objectives of the study are as follow:

- To relate our theoretical understandings of management acquired till the period with the

real work environment.

- To study and analyze working system of the various departments of the bank and come

up with the list of strengths and weaknesses.

- To understand the major functions along with products and services of commercial

banks.

- To understand the general banking activities, practices and policies.

1.3 Methodology

According to the designed patterned of this program, students need to complete internship for the

period of 8th weeks and prepare the report. The report is prepared by using the information that is

obtained from different sources i.e. interview, bulletin, newspapers, booklet, websites, and

annual report of HBL.

1.3.1 Organization Selection-

7

1.3.2 Placement

1.3.3 Duration

1.3.4 Activities performed

Organization selection

Before selecting the organization, I dropped my Curriculum-Vitae at different banks. I had to

choose the best alternatives. Considering the suggestion and recommendation from my friends

and family, I choose Himalayan Bank Limited to work as an intern. My college also provided me

the recommendation letter, which helped me to get a chance to work as an internee in one of the

best banks in the country.

Placement

Regarding the placement, I was first placed at the customer service department. During my stay I

learned to familiarize myself to the environment and learn the activities performed by the card

center. Later I was placed in the remittance promotion department, and LC department. I stayed

at the remittance promotion department for comparatively longer period, so I could collect and

study all the possible details about the remittance transfer. Due to lack of the time, I stayed at the

Trade Finance department for 2 days only. So I could only study about general procedures of

issuance of Letter of Credit.

Duration

The duration of internship period has been defined for eight weeks by Tribhuvan University. I

have completed my internship program which lasted for two months at Himalayan Bank Limited

at Thamel Branch. During this period I was placed at administration department, customer

service, remittance, Letter of credit department. I was allowed to work for eight weeks starting

from July 2nd to September 1st.

Activities Performed in the organization

8

Himalayan Bank Limited is one of the major financial intermediaries whose primary function is

the transfer of monetary resources from the savers to the users. This section includes the study

based on the internship period and the various tasks performed during the stay in bank. The

followings are general function of HBL, which I was allowed to learn during my internship

period. But these functions are performed by different departments.

HBL provides different customer services like opening and closing of accounts, issuing

cheque book, account statements, balance certificates, debit and credit cards and access to e-

banking.

The other functions are Issue of guarantee, Letter of Credit, fund transfer, Bills/Remittance,

safety of valuable goods, etc.

Promotion of remittance for those who are in abroad for different purposes,

Besides above functions, I was also allowed to learn other activities that are performed in

different departments like how to open the different accounts, what the general procedures to

open these accounts, how to verify the original data, and how to solve the customer queries as

well as complaints, how to make bank statements, etc. In the remittance department, I learnt the

procedure of collecting remittance, how to identify the actual remittance receiver, sending

remittances, etc.

1.4 Limitations of the Study

During the preparation of this report, there were many limitations, which are as follows:

1. The study is mainly based on the data provided in the annual report. 2. Therefore, the

accuracy of results and conclusions are totally depended on data published in annual report.

3. The study is about HBL only.

4. The study only covers the transaction of remittance.

5. The report is prepared for an academic purpose only.

6. Only eight weeks data are taken into consideration due to data unavailability.

7. The deep analysis and study couldn’t be done due to time and data limitation.

9

CHAPTER II

INTRODUCTIO TO THE INDUSTRY

Banking Sector

Banking sector plays an important role in the economic development of the country.

Commercial banks are one of the vital aspects of this sector, which deals in the process of

10

channelising the available resources in the needed sector. It therefore acts as an intermediary

between the deficit and surplus group of the financial resources.

Financial system contains two components viz. depository and non-depository financial

institutions. Commercial banks and finance companies are the examples of the depository

institutions where as Employee Provident Fund, Development Banks, Insurance Companies,

etc. are the examples of non-depository financial institutions. The study in this report is

concerned with the depository financial institutions i.e. Himalayan Bank Ltd. Financial

institutions play an important role in the proper functioning of the economy. These

institutions act as an intermediary between the individuals who lend and borrow financial

instruments. These institutions make the flow of investment easier.

Development of Banking Industry in Nepal

Like other countries goldsmiths, merchants and moneylenders were the ancient bankers of Nepal.

Tejarath Adda established during the tenure of the then Prime Minister Ranoddip Singh (1933

B.S) was the first step towards the institutional development of banking in Nepal. Tejarath Adda

did not collect deposits from the public but gave loans to employees and public against the

bullion.

Banking in modern sense started with the inception of Nepal bank limited (NBL) on 1994/7/30

B.S. Nepal bank limited had a Herculean responsibility of attracting people toward banking

sector from pre-dominant moneylenders net and of expanding banking services. Being a

commercial bank, it was natural that NBL paid more attention to profit generating business and

preferred opening branches at urban centers.

Government however had onus of stretching banking services to the nook and corner of the

country and also managing financial system in a proper way. Thus, Nepal Rastra Bank (NRB)

was set up on B.S. 2013.01.14 as a central bank under Nepal Rastra Bank act 2012 B.S. Since

then, it has been functioning as the government's bank and has contributed to the growth of

financial sector. The major challenge before NRB today is to ensure the robust health of financial

institutions. Accordingly, NRB has been trying to change them and has introduced a host of

prudential measures to safeguard the interest of the public. NRB is yet to do a lot to prove

11

themselves efficient supervisors. NRB really requires strengthening their policymaking,

supervision and inspection mechanism.

Integrated and speedy development of the country is possible only when competitive banking

service reaches nooks and corners of the country. Keeping this in mind, government set up

Rastriya Banijya Bank (RBB) in B.S.2022/10/10 as a fully government owned commercial bank.

As the name suggests, commercial banks are to carry out commercial transaction only. But

commercial banks had to carry out the functions of all types of financial institutions. Hence,

industrial development center (IDC) was set up in 2013 B.S. for industrial development. In 2016

B.S. IDC was converted to Nepal industrial development corporation (NIDC). Similarly,

agricultural development bank (ADB) was established in 2024/10/07 B.S. to provide finance for

agricultural produces so that agricultural productivity could be enhanced by introducing modern

agricultural techniques. Moreover, security exchange center was renamed Nepal stock exchange

in 1990.NEPSE opened its trading floor on 13 January 1994.

With the establishment of RBB and ADB, banking service spread to both the urban and rural

areas. NRB also gave incentive to NBL to expand their branches to rural areas. This helped the

common people reduce their burden of paying higher rate of interest to moneylenders and

absolved them from kowtowing before moneylenders. It is natural expectations of customers

which keep on increasing. Once they got banking services, they were expecting improvement

and efficiency. However, excess political and bureaucratic interference and absence of modern

managerial concept in these institutions was hurdle in this regard. Banking service to the

satisfaction of customers was a far cry. The inception of Nepal Arab Bank Ltd. (renamed as

Nabil Bank Ltd. on January 1, 2002 A.D.) on 2041/03/29 B.S. (July12, 1984 A.D.) as the first

joint venture bank to be a milestone in the history of banking. Nabil Bank gave a new ray of

hope to the sluggish financial sector.

The very marketing concept of Nabil Bank forced the other bank in operation to be more

customers oriented and led the influx of commercial banks. Having observed the success of

Nabil Bank based on marketing concept and also because of liberal economic policy adopted by

the successive governments, following commercial banks came into being.

Because of higher return on investment and lower capital requirement, entrepreneurs were

interested in setting up new banks including branches of foreign banks. However, current

12

political and economic scenario of the country coupled with new prudential norms of Nepal

Rastra Bank and stiff competition may make the entrepreneurs give a second thought to the idea

of establishing banks.

Commercial Banks

Commercial banks are the major components in the financial system. They work as the

intermediary between depositors and lenders and facilitate in overall development of the

economy, with major thrust in industrial development. In modern time, commercial banks, which

are facilitated, regulated and supervised by the central bank, confine them and concentrate in

their activities of fulfilling needs of their customers.

Modern commercial banks can be identified by different name such as business banks, retail

banks, clearing banks, joint venture banks, they all perform the same basic function i.e. they

provide a link between lenders, those who have surplus of money and do not wish to spend

immediately with borrowers, those who do not have surplus money but wish to borrow for

investment in productive purpose. Basically, by charging a rate of interest to borrowers slightly

higher than they pay to lenders, the banks make their profit. This is known as financial

intermediation.

.

Importance of Commercial Banks

1. Channelise the idle resources towards the economic activities.

2. Provide financial services in order to systemize the customer's financial activities.

3. Help build the efficient financial sector of the economy.

4. Assists for rapid economic growth of the country by providing parties with deficit of

fund, required and reasonable financial assistance.

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Functions of Commercial Banks

Though the primary function of commercial banks is to act as a 'go- between' the savers and

users of funds and channelise idle and scattered resources prevalent, it assists financial system by

undertaking following other functions:

Core functions:

The core functions of commercial banks is to ease the business or any other economic

activity by either providing funds to parties with deficit of it accepting deposit from those

with surplus of it, or providing any other non fund based services like issuing letter of credit,

issuing guarantee, remittance and safe deposit lockers

Support functions:

The bank, in order to support its core function of lending and borrowing fund, has to perform

support functions like personnel, administrative, operations and management information

system.

Personnel:

All the functions related to the management of human resources are included

in this category. Some of the functions related to human resource may be stated as:

1. Hiring and firing.

2. Job design and evaluation.

3. Motivational functions.

4. Performance evaluation.

5. Coordination and

6. Maintaining cordial relationship and favorable environment.

Administrative:

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Under administrative functions of banking, procurement and supplies, administration of

contracts, fulfilling contractual obligations and management of the logistics are included.

These functions are related with the external affairs and procurement and distribution of

materials required for day-to-day operations.

Operations:

The activities related with operation procedure, system and technology and inter-branch

tractions are included in operation function. These functions hold reasonable importance as these

are related with how the primary functions (lending and borrowing) are to be performed and

management of system and technology involved in such functions.

List of Licensed Commercial Banks of Nepal

Table No.: 1

List of Licensed Commercial Banks of Nepal

Companies

1. NMB Bank Limited

2. Development Credit Bank Ltd.

3. Nepal Industrial & Co.Bank

4. Laxmi Bank Limited

5. Kumari Bank Ltd

6. Lumbini Bank Ltd.

7. Nepal Credit & Com. Bank

8. Siddhartha Bank Limited

9. Lumbini Bank Limited Promotor Share

10. Kumari Bank Ltd. (PROMOTOR SHARE)

11. Nabil Bank Limited Promoter Share

12. Peoples Finance Co. Ltd Promoter Share

15

13. Everest Bank Ltd(Preference Shares Convertible)

14. Machhachapuchhre Bank Ltd.(Promotor Share)

15. Bank of Kathmandu(Promoter Share)

16. Laxmi Bank Limited Promotor Share

17. Nabil Bank Ltd.

18. Nepal Investment Bank Ltd.

19. Standard Chartered Bank Ltd.

20. Himalayan Bank Ltd.

21. Nepal SBI Bank Limited

22. Nepal Bangladesh Bank Ltd.

23. Everest Bank Ltd

24. Bank of Kathmandu

25. Machhapuchchhre Bank Ltd.

(Source: www.nepalsharemarket.com)

A Profile of Himalayan Bank Limited

Himalayan Bank was established in 1993 in joint venture with Habib Bank Limited of Pakistan.

Despite the cut-throat competition in the Nepalese Banking sector, Himalayan Bank has been

able to maintain a lead in the primary banking activities- Loans and Deposits.

16

Legacy of Himalayan Bank lives on in an institution that's known throughout Nepal for its

innovative approaches to merchandising and customer service. Products such as Premium

Savings Account, and HBL Proprietary Card besides services such as ATMs and Tele-banking

were first introduced by HBL. Other financial institutions in the country have been following the

lead by introducing similar products and services. Therefore, HBL stand for the innovations that

they bring about in this country to help their Customers besides modernizing the banking sector.

With the highest deposit base and loan portfolio amongst private sector banks and extending

guarantees to correspondent banks covering exposure of other local banks under their credit

standing with foreign correspondent banks, they believe they obviously lead the banking sector

of Nepal. The most recent rating of HBL by Bankers’ Almanac as country’s number 1 Bank

easily confirms their claim.

All Branches of HBL are integrated into Globus (developed by Temenos), the single Banking

software where the Bank has made substantial investments. This has helped the Bank provide

services like ‘Any Branch Banking Facility’, Internet Banking and SMS Banking. Living up to

the expectations and aspirations of the Customers and other stakeholders of being innovative,

HBL very recently introduced several new products and services. Small Business Enterprises

Loan, Pre-paid Visa Card, International Travel Quota Credit Card, Consumer Finance through

Credit Card and online TOEFL, SAT, IELTS, etc. fee payment facility are some of the products

and services. HBL also has a dedicated offsite ‘Disaster

Recovery Management System’. Looking at the number of Nepalese workers abroad and their

need for formal money transfer channel; HBL has developed exclusive and proprietary online

money transfer software- HimalRemit TM. By deputing our own staff with technical tie-ups with

local exchange houses and banks, in the Middle East and Gulf region, HBL is the biggest inward

remittance-handling Bank in Nepal. All this only reflects that HBL has an outside-in rather than

inside-out approach where Customers’ needs and wants stand first.

HBL is not only a Bank, It is committed Corporate Citizen

Corporate Social Responsibility (CSR) holds one of the very important aspects of HBL. Being

one of the corporate citizens of the country, HBL has always promoted social activities. Many

17

activities that do a common good to the society have been undertaken by HBL in the past and

this happens as HBL on an ongoing basis. Significant portion of the sponsorship budget of the

Bank is committed towards activities that assist the society as large.

The Bank’s Vision:

Himalayan Bank Limited holds of a vision to become a Leading Bank of the country by

providing premium products and services to the customers, thus ensuring attractive and

substantial returns to the stakeholders of the Bank.

The Bank’s Mission:

The Bank’s mission is to become preferred provider of quality financial services in the country.

There are two components in the mission of the Bank; Preferred Provider and Quality Financial

Services; therefore people at HBL believe that the mission will be accomplished only by

satisfying these two important components with the Customer at focus. The Bank always strives

positioning itself in the hearts and minds of the customers. Himalayan Bank is committed to be a

Bank which has "The Power to Lead."

The Bank’s Objective:

To become the Bank of first choice is the main objective of the Bank.

1. To become a leading bank in the country by providing premium products and services

and then ensuring attractive and substantial return to shareholders.

2. To emerge as a quality provider of the quality financial services of the country.

3. To become the bank of first choice.

4. To ensure handsome and steady return on investment.

5. To provide banking services with difference. To respond to all banking needs courteously

and co efficiently.

18

6. To promote productivity through sustainable benefits,

7. To become a responsible national institution.

8. To bridge the gap between savers and borrowers efficiently and effectively.

Himalayan Bank has access to the worldwide correspondent network of Habib Bank for fund

transfer, letter of credit or any banking business anywhere in the world. Habib Bank is the largest

and oldest bank in Pakistan having over 1700 domestic and 65 overseas branches covering all

continents and over 1800 correspondents worldwide. Besides, Himalayan Bank has

correspondent arrangement with 178 internationally renowned banks like American Express

Bank, Citibank, ABN Amro etc.

The head office of Himalayan Bank Limited is situated at Karmachari Sanchaya Kosh

Building,Tridevi Marg, Thamel.

The bank has fifteen branches over the country. Among the total, five are located inside the

capital including the head office and the rest is dispersed throughout the country.

The various branches of HBL operating throughout the country are as under:

Table No: 2

S.N Name of branches Branch Address

1 Pokhara Branch New Road, Phokhara Kaski

2 Maharajgung Branch Teaching Maharajgung, Kathmandu

3 New Road Branch Bishal Bazar Kathmandu

4 Butwal Branch Traffic Chowk

5 Patan Branch Pulchok, Lalitpur

6 Tandi Branch Ratnanagar ,Tadi, Chitwan

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7 Birgunj Branch Mahabir Road, Birgung, Parsa

8 Dharan Branch Putali Line, Dharan, Sunsari

9 Hetauda Branch Main Road Hetauda

10 Banepa Branch Main Road Benepa, Kavre

11 Siddartha Nagar Branch Police Colony , Bhairahawa

12 Biratnagar Branch Shanihat Main Road Biratnagar

13 Credit Card Branch Pulchock ,LalitPur

14 Bhaktapur Branch Katunje ,Bhakatpur

15 Narayangadh Branch Pulchock , Chitwan

(Source: Annual report of HBL)

Equity participation:

Table no:

Ownership %

Local-

-Employee Provident Fund

-Nepalese Promoters

-General public

14

51

15

Foreign(Habib BankLimited,

Pakistan)

20

Total 100

20

(Source: Annual report of HBL)

Awards And Recognitions

Awards and Recognitions received by Himalayan Bank Limited in the last five years

Number 1 Bank of Nepal- 2006 awarded by The Bankers’ Almanac, Britain

Number 1 Bank of Nepal- 2003 awarded by The Bankers’ Almanac, Britain

National Excellence Award- 2003 awarded by Federation of Nepal Chambers of

Commerce and Industry

21

The Bankers' AlmanacWorld Ranking 2006

The Bankers' Almanac World Ranking 2003

FNCCI - National Excellence Award 2003

Products and Services offered

Though the Bank is fairly young in terms of tenure of operations, it has been the innovator of

tenure of its operations; it has been the innovator in introducing many new products in Nepalese

financial market. To illustrate it, the following products have been implemented till now:

Credit card:

Himalayan bank has been a pioneer in introduction in introducing a Nepalese domestic credit

card; the bank has introduced "Himalayan Bank Gold Card". Himalayan Bank is also the

member of VISA and MASTERCARD international. The bank issues all ranges of VISA card

and is developing framework for MASTERCARD issuance.

Tele-Branch Banking:

To provide more prompt and efficient services to customers, Himalayan Bank has been

pioneering in instituting telebanking services. Dialing a pre-specified telephone number client

can have information on:

Make balance and statement inquiries.

Order statement and chequebook

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Get information on foreign exchange, interest rates etc.

Any-Branch Banking:

The bank has any branch-banking facility in New Road, Thamel, and Patan branches and is

looking forward to extending it to other branches as soon as possible. Adoption of world wide

accepted GLOBUS software enhances the convenience of operating this service and security of

the operation as well. This product, integrated with the core banking system will enable to make

certain operations like withdrawal and deposit of cash and cheques from any of the bank's

branches can walk into any of the bank's branches possible. Customers maintaining an account

with any of the branches can walk into any of the branches convenient to them for operation of

the account, which means they are not restricted to particular branch for operating that account.

ATM (Automatic Teller Machine):

Automatic teller machine (ATM) placed in the premises of Thamel branch, New Road branch,

Maharajgunj branch and Patan branch enables the bank to extend the bank facilities to 24 hours.

Customers can utilize ATMs and make withdrawal at any time, be it 5 a.m. in the morning or the

12 p.m. at midnight. To use this facility, one must request for the ATM card from any of the four

branches providing service. It's the beauty of ATM service that enables one to withdraw cash

from account in any of the branch providing this service

Home loan and Hire purchase loan:

The bank has recently introduced home loan as its new product under which employed or self-

employed persons or pensioners within the age bracket of 25 to 65 years with regular and stable

source of income and adequate saving are qualified. In case of home loan, it requires the

proposed site to be accessible with at least 9 feet motorable road and should fall under the bank's

criteria for collateral mortgage. The primary focuses of this product are the professionals like

doctors, engineers, lawyers, and chartered accountants as well as self employed businessman.

The bank provides Home loan for three basic purposes, viz.

Purchase

Construction

Extension

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The bank provides loan for almost every vehicles, especially for personal use, and vehicles brand

but the bank has special scheme for Hyundai and Perouda cars under which thy provide loan to

the customer in a comparatively lower interest rate. The bank finances maximum up to 70 and 80

percentage of the total cost in home and hire purchase loan respectively.

Himal Remit:

Himal Remit is one of its latest products, which facilitates transfer of fund from almost all over

the world, especially from all the parts of the Middle East, in most of the major currencies. The

funds can be transferred through the correspondent bank arrangement with various financial

institutions in Middle East to facilitate efficient fund transfer. Furthermore, funds can also be

transferred within the country to the following cities in Nepal directly, and the bank provides

service of transferring funds to other cities on Nepal, via its total correspondents or branches.

Apart from these services there are some other innovative measures too: accidental death

insurance is one example of it. It covers individual account holders. The insurance benefit

payable to the nominee of the account holder is a lump sum equivalent to four- time ht minimum

balance in the account during the month of the event, subject to a maximum of 500,000 Rupees.

PSA scheme (Premium Saving Account Scheme) provides incentives for all account holders with

balance of more than 50,000. PSA holders are served through a special counter in all branches.

The participants of this scheme can receive Himalayan Bank Gold Card, ATM card along with

tele-banking facility, free of charge. The customers under this scheme are given preference in

providing self-deposit lockers. They also enjoy 20% wavier in rental on the small size lockers.

Interest on all accounts as such is calculated on daily basis. PSA holders maintaining average

balance of over 100,000 are eligible to take part in lucky draw under a premium prize and several

other prizes are given every month.

The bank currently offers following types of deposits schemes to the customers:

Current account

Saving account

Short term deposit account. (7 days to 90 days)

Fixed term deposit. (Above 90 days)

The bank accepts and maintains these types of deposit accounts in the following currencies.

24

Nepali Rupees

US Dollars

Pound Sterling

Deutsche Mark

Japanese Yen

Swiss Franc

Any customer complying with the general rule for account opening and fulfilling the document

requirement can open an account

Current Status of the Organization

The Himalayan Bank Limited is one of the best banks in the country. The Bank holds a vision to

become a Leading Bank of the country by providing premium products and services to the

customers, thus ensuring attractive and substantial returns to the stakeholders of the Bank.

Legacy of Himalayan Bank lives on in an institution that's known throughout Nepal for its

innovative approaches to merchandising and customer service. Products such as Premium

Savings Account, HBL Proprietary Card and Millionaire Deposit Scheme besides services such

as ATMs and Tele-banking were first introduced by HBL. Other financial institutions in the

country have been following the lead by introducing similar products and services. Therefore,

HBL stand for the innovations that they bring about in this country to help their Customers

besides modernizing the banking sector. With the highest deposit base and loan portfolio

amongst private sector banks and extending guarantees to correspondent banks covering

exposure of other local banks under their credit standing with foreign correspondent banks, they

believe they obviously lead the banking sector of Nepal. The most recent rating of HBL by

Bankers’ Almanac as country’s number 1 Bank easily confirms their claim.

The Bank believes in

1. Providing quality services to the customers

2. Building healthy future for Bank Employees

3. Providing attractive return to stakeholders

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4. Upholding honesty and sincerity

5. Embracing extra-curricular activities for refreshments and fun at work

6. Developing a fruitful bond with the Society through continuous socially responsible

activities.

Remittances

Remittance in simple words is the transfer of the funds- a portion of migrant’s earnings from the

migration destination to the place of origin. Remittance transfers may be

domestic or international. The term “remittance” is normally limited to denote monetary and

other cash transfers transmitted by migrant workers to their families and communities. Domestic

remittances occur, for example, when there is migration from rural to urban areas within a

country. Similarly international remittances are defined as cross-border person-to-person

payments typically recurrent in nature (e.g. who send money to their families in their home

country every month).

The emphasis is on person-to-person payments rather than payments to purchase goods and

services or business-to-business payments. These person-to-person payments are typically

relatively low-value compared to, for example, wholesale bank-to-bank transfers. (# Average

size of remittance to Nepal amounts USD 200 to 400). Often the flows are between relatively

low-income individuals and the senders, as migrants, may not always be well integrated into all

aspects of the host-country's society and economy. In addition, although remittance transfers are

typically recurrent, in practice they are usually made as a series of individual instructions rather

than by standing order.

26

REMITTANCE INFLOW TO NEPAL

66

107

5954

21

161310764

0

20

40

60

80

100

120

YEAR

RS

. IN

BIL

LIO

N

REMITTANCE IN NEPAL:

Remittance received from abroad has been one of the major factors for Nepalese Economy. It has

continued to be the major source that injects much-needed cash into the economy (# currently

remittance contributes to more than 14% of the total GDP of the country). Apart from

contributing significantly to the foreign exchange reserves of the country, this enhances the

import potential of the country which will eventually drive the growth of the economy as a

whole.

For the underdeveloped country like Nepal, the flow of funds from migrant workers back to their

families in their home country is an important source of income. Approximately USD 1 billion

per year enters the country in the name of remittance achieving at least 8% growth each year.

The clearer picture of the growth of remittance in Nepal can be assessed through following data:

Table no:

Situation of Remittance in Nepal

Year Amount Annual Growth

Rate (%)NPR (Billion) USD (Million)

95/96 4 58

96/97 6 76 30.06

97/98 7 94 24.9

98/99 10 139 47.6

99/00 13 171 22.8

00/01 16 215 25.6

01/02 21 283 31.7

02/03 54 732 158.7

03/04 59 792 8.1

04/05 66 886 11.9

05/06 107 1445 63.1

The

above

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figures clearly show that the remittance inflow to Nepal has been increasing in a very steady

way. The major growth can be seen in 2003/04 and 2005/06 registering the growth of 54% and

158.7% and 63.1% respectively. However one of the important factor to be considered here is

that still at least 35% of the total remittance have been coming through the unofficial channels

such as hundi and personal delivery which may affect the contribution of the remittance in the

total economic growth of the country and to the remittance industry as a whole if it is not

controlled which is operating at much lower cost than that of remitting company’s increasing

their attractiveness.

Activities done regarding promotion of Himal Remit

HimalRemit, a premium online customer focused and technology oriented Money Transfer

product is brought to you by Himalayan Bank Limited, the leading joint venture bank of Nepal.

Himalayan Bank is a pioneer in the field of retail money transfer business with over 11 years of

customized service delivery experience in the field. Himalayan Bank has the largest network

covering all major cities, towns and villages of the country and is capable of paying at more than

200 locations across Nepal.

HimalRemit is a state of art web-based money transfer system. It is easily accessible through our

main web domain http://www.himalayanbank.com/. It can be directly accessed by all our

branches thus ensuring prompt execution of the remittance. The product is monitored and

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serviced 24/7 by our Remittance Service Department dedicated to deliver fast and reliable

services to the Customers.

The remitting agency can transfer funds either to the beneficiary against the identification

document or can credit the Customer’s Account maintained either with Himalayan Bank Limited

or other local banks of Nepal.

The money transferred through this product will be on real time basis. The system will

automatically generate RAD number. The RAD number is number generated by the system for

each transaction and is unique and this becomes the main basis for payment at the receivers’ end.

The RAD number consists of ten digits.

1. The remitter will make request for fund transfer to pre-agreed location against cash

deposit and he/ she is required to fill all details i.e. Name, ID number, Currency &

Amount etc.

2. Based on the information provided by remitter, remitting agent shall transfer the data to

the system and upon approval of transfer, RAD number will be generated by the System,

which will be provided to the remitter.

3. The remitter will have to pass details of RAD number, Amount and nearest location from

where money is to be collected to the beneficiary. The beneficiary will go to the pre-

arranged payment location and claim the amount. The payment location will be either

Himalayan Bank Branch or HBL agent.

4. For the payment to be paid from the HBL branch, the branch, upon confirmation of RAD

number and identification of beneficiary, will make the payment.

5. For the payment to be paid from other authorized agent, agent shall make payment upon

confirmation of RAD number, Identification and after receiving authorization from

Himalayan Bank Limited.

6. For the payment to be credited to the account with HBL and/ or other banks in Nepal,

payment details i.e. beneficiary’s name, account number, bank/ branch name and amount

etc., will be provided in HimalRemit. Based on the information in the System, HBL will

arrange to make deposit to the beneficiary’s account. HBL will arrange to make deposit

to beneficiary’s branch through its branch where HBL has branch or through its agent,

where HBL does not have its Branch.

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7. Account credit confirmation will be provided to Remittance Promotion Department by

HBL branch/ paying agent that will be passed on to the Remitting agent.

8. Paying agent, after making the payment, will send the confirmation of payment to

Himalayan Bank, which will be sent to the remitting agent as confirmation of payment.

9. The system facilitates remitting agent(s) to browse the status of particular payment on the

basis of RAD unique numbers.

Special Features of Himal Remit- the Online Remittance Software:

Web based technology, direct access from our main web site

http://www.himalayanbank.com/

Provide instant updates on remittance request at the receiving end for prompt processing.

Manage agents and officers through central administration at Himalayan Bank.

Provide a secure and reliable means of remittance information.

Provide instant updated information to the HBL agents.

For the promotion of Himal remit, during the internship, I visit the various place for this purpose

where I had to open the account for those who are going abroad for the purpose of earning like

Korea, Dubai, Qatar, UAE, Saudi Arabia and so on

Account open for them is saving account of zero balance those who are going Korea and Rs.100

for those who are going other countries. One family member of them could also enjoy the

facilities provided by the bank.

Savings Account

Savings Deposit Account can be opened in any of our Branch Offices. The minimum deposit to

be maintained by the Customer varies according to the Branch. Customers are provided with free

personal accidental death insurance. Customers opening this account get a free Cheque Book.

The Bank offers Any Branch Banking Facility.

Feature:

1. Interest will be calculated and credited to depositor's Savings Accounts on minimum

monthly balances in every Six Months.

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2. The minimum deposit ranges from NRS 2,500.00 to NRS 15,000.00 to open a Savings

Account in Local Currency depending upon the Branch. Minimum deposit to open foreign

currency A/C is USD 50.00 or equivalent in foreign currency A/C. No interest will be

provided for balance less than specified above.

Document Requirements for opening account

Following documents are required to open a Current/Savings/Premium Savings Account with the

Bank depending upon the type of Account:

a. Personal Identification: Citizenship Certificate or Passport and 3 copies of

Photograph;

b. Nominee Declaration

For the promotion of himal remit I went to Banshipati where people

selected by government for working Visa in Korea are trained. For

this I went there four times.

Visit times Number of people who open the account

1 65

2 16

3 28

4 36

Total 145

People open this account because of following facilities :

It can be directly accessed by all our branches thus ensuring prompt execution of the

remittance

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The product is monitored and serviced 24/7 by our Remittance Service Department

dedicated to deliver fast and reliable services to the Customers.

Can credit the Customer’s Account maintained either with Himalayan Bank Limited or

other local banks of Nepal.

Customers are provided cheque book along with Visa debit card which can be used in

Nepal and India.

When account is opened by customers there will be accidental death insurance up to Rs.5

lakhs.

By these features people are attracted towards the himal remit.

Other activities done in the Himalayan Bank:

Account open for other customer who want to open account in bank

Printing of Cheque and preparing cheque book.

Printing of statements and balance certificates.

Assist in card services

The other functions are Issue of guarantee, Letter of Credit, fund transfer, Bills/Remittance.

Chapter III

Lesson learnt, Conclusion and Recommendation

 Lesson learnt

                   Working as an intern in Himalayan bank limited for two months, I was able to use myself in the world of business where I could apply my theoretical knowledge in practice. This internship also provided me with greatest opportunity to acquaint myself with the banking industry. Further, it provided me the practical exposure and helped me to understand corporate social responsibility and develop corporate attitude.

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            I have learned to be in time while working with the bank.

            I have learned to get permission before doing any thing and providing any service to the customer.

      I have understood the banking procedure through the bank’s perspective.

I got chance to be familiar with several types of product and services provided by the bank

I have learned process of account opening in the bank under different saving sachem..

I have find out the existing as well as the possible problems associated with Customer Service Department, card section, remittance promotion department and trade operation.

I have learned about the change in customers’ preference regarding the various product launched by the bank

I have learnt a lot of other aspects other than the banking as to socialize with the people, to deal with the senior staffs, and to deal with the intern colleague so as to make the working environment cozier and friendlier.

I have also learnt that the behavioral issues are most important inside the organization. Customer feel satisfied when they are behaved properly.

Their queries are needed to be answered in a friendly way so as to retain them in the organization.

         Lastly, working in Himalayan bank, I was able to develop some qualities in me which will be helpful for me throughout my life. Internship in such bank not only gives us an insight to learn about how the bank perform the inter bank transaction in Nepal , but also boosts our future prospects in the banking sectors. I would like to thanks Himalayan bank once again for giving me an opportunity to grow up practically in its comprehensive banking environment.

 

Conclusions

By and large, a proper marketing plan, a better strategy and a smooth implementation are the

basic ingredients of any successful business. So to operate any profitable business, lots of

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homework should be done. Since the future program of HBL, are quite good so delay should not

be made.

The study is primarily aimed at assessing financial aspects of the bank. It has been found that the

bank has widespread branches around the major cities and has a pleasant goodwill that it has

created in the market through its operations. The findings of analysis can be concluded as below:

The bank has unsatisfactory cash reserve ratio over the review period. However, we cannot

conclude it as a setback due to statutory requirement of maintaining average cash reserve ratio on

a weekly basis of immediately preceding fourth week.

The bank, though able to collect sufficient deposit does not have satisfactory loans and advances.

Analysis of other ratios shows that the bank neither has been able to perform outstandingly, at

least when we conclude on the basis of annual report, nor has to lament for what it couldn't

achieve. However, it has been noticed that the banks performance, from the profit to return in

assets, has been slackening and that it needs improvement in its due course of operations. But we

cannot overlook the macro-economic conditions and instability of the current affairs. The

dividend payout ratio of the bank has not remained in the satisfactory level. The net profit level

of the bank has gone up considerably over the last few years of operation, which, if not tackled

prudently, would obviously hamper its profitability. Had it been able to administer and follow up

the loan that it had dispersed and evaluate the proposals and its creditability thoroughly, it would

not have to face problems like these.

There is high prospective and growing market for card business especially acquiring business.

Nowadays, people are being aware about card facilities and the advantages of holding a card,

which is gradually progressing in industrialization process and increasing income level among

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the higher and middle class society. So the possibility of other banks and/or financial institutions

entering this field should not be ignored

Conclusively, the bank has been able to produce satisfactory results over the review period

despite environmental adversities. While we relate the present economic condition with its

performance, we won't have any other option in hand apart from praising it for whatever it has

been able to realize.

Recommendation

 Recommendations to organization.

Nepal too needs to develop the banking habit of its people. We just cannot make any more

unsubstantial and detrimentally indigenous excuses.

Bank should try to focus on customer satisfaction and relation

Bank should search for new opportunities and greater coverage in remittance service.

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Bank should try to change the employee behavior by introducing the concept of

teamwork and delegate them adequate authority to carry out their work.

Bank should try to satisfy its customer by providing them prompt service.

To improve the skill of banks employee regular skill development programs

should be initiated and periodic skill test for the employees can be applied

Since so many risks are attached with the credit card business, HBL should develop

innovative and effective risk management programs and services for its members, which

helps to maintain credit card operation at a high standard and prevent the fraudulent act.

For this purpose, HBL should give knowledge about credit card fraud to its customer and

should prevent them from fraud by using latest technology. But HBL should also balance

technological cost and its respective benefits. Thus Public awareness of credit card fraud

should be generated to capture more market for credit card

To encourage frequent usage of cards, HBL can introduce the concept of reward points.

For e.g., for cardholders, every 100 rupees worth of purchases made through the card, the

cardholder gains one point. These points could be redeemed for gifts, select product

purchases and even for paying the annual fees. So every point would be equivalent to one

rupee. This would encourage more use of HBL’s credit card.

Bank should build the effective feedback channel so that the bank can know and make

correction from the valuable suggestions and comment and, feedback of the marketing

activity given by the consumer.

Recommendation to Internship programme.

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This internship program is fruitful to the student of BBA as they get chance to gain practical

knowledge about the Banks, which they have been studying in their course.

 As internship program is must in BBA course, students must get clear guidance regarding the

work at Banks. Many Banks have misconception about the intern students as they keep them for

filling purpose, doing photocopies, fax etc. 

Thus internship of BBA program should clearly specified along with the work that interns are

ought to do. It should specify that work of any interns should be related with banking activities

as they enter a bank to gain a practical knowledge about a Banks.

 Internship is very rewarding to every student of this program. It would work more effectively

and gives positive result if it becomes more specific. It has become difficult to bank as well as

interns regarding the activities they are supposed to perform in an organization. So if it becomes

more specific and defines the criteria within which interns are ought to do work or the works

Bank could give to the interns then this internship program surely would help every intern to

gain maximum practical knowledge about Banks.

 

 

Recommendation to Faculty of Management

 First of all I like to thank to the faculty of Management by providing the chance to read the

BBA course under the T.U, renowned university in the world by sitting in the country. They

provide us the facilities to do internship in the financial sector of the country for the practical

knowledge of the course and make us easily sellable in the market after finishing the course.

 According to the course of BBA we need to fulfill the internship but the faculty doesn’t specify

how to do and what we have to do in the internship period. So not having the knowledge of this

we student faces many problem in the starting phase of the internship period. But we are

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successful to make them convinced about our requirement and fulfill the two months internship

period.

 I would like to thanks to all the people who help faculty of management to bring this fruitful

course in the university and run under different colleges of the country. At last but not the least I

would like to thank to faculty of  KIST College of Management helping me to get the internship

in Himalayan Bank limited.

 

 

 

 

Annex 1

Boards of Directors

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Mr. Manoj B. ShresthaChairman

Mr. Ashraf M. WathraFirst Vice Chairman

Mr. Prem P.KhetanSecond Vice Chairman

Mr. Prachanda B. ShresthaDirector

Mr. Bijay B. ShresthaDirector

Dr. Ramesh K. BhattaraiDirector

Mr. Amar S. RanaDirector

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Mr. Upendra Keshari PoudyalProfessional Director

Mr. Himalaya S. RanaChief Advisor to the Board

Mrs. Ranjana ShresthaAlternative Director

 Mr. Surendra SilwalAlternative Director

Ms. Menuka ShresthaAlternative Director

Mr. Gyem Raj AdhikariCompany Secretary

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Management Team

Executive Committee (E.C.)

  Name Designation

Mr. Prachanda Bahadur ShresthaChairman

Director

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Mr. Bijaya Bahadur ShresthaMember

Director

Mr. Upendra K. PoudyalMember

Director

Mr. Ashoke SJB RanaMember

Chief Executive Officer

Mr. Masood Ul HasanMember Secretary

Senior General Manager

Annex 2

Management Team

  Name Present Dept./Branch

Mr. Ashoke SJB RanaChief Executive Officer

Head Office

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Mr. Masood Ul HasanSenior General Manager

Head Office

Mr. Sushiel Joshi General Manager

Head Office

Mr. Pradeep N. Rayamajhi Executive Administrative Officer

General Administration Department, HO

Mr. Ujjal R. Rajbhandary Executive Marketing Officer

Corporate Marketing Dept, HO

Mr. Anup MaskeyExecutive Credit Officer

Credit Control Dept, HO

Mr. Banshidhar SharmaManager

IT & SWIFT Dept, HO

Mr. Maheshwor P. Joshi Manager

Legal and Shares Dept, HO

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Kanchan BasnyatManager

IT Dept, HO

Sulap Raj AryalManager

Maharajgunj Branch, Branch Manager

Sunita ShresthaManager

Reconciliation Dept, HO

Bina PandeyManager

Credit Management & Administration Dept, HO

Rabindra Narayan PradhanManager

Thamel Branch, Branch Manager

Ishwar Kumar KarkiExecutive Human Resouces Officer

Human Resources Dept, HO

  Vinay Kumar JoshiManager

Bhairahawa Branch, Branch Manager

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  Sisam Pradhanang JoshiManager

CCD, Head Office

Mrigendra PradhanManager

Patan Branch, Branch Manager

  Bijaya Man NakarmiManager

Thamel Branch, Dy. Branch Manager

Robin Kumar NepalManager

Birgunj Branch, Branch Manager

  Gaurav Bikram ShahManager

TOC, Head Office

  Lokesh JB RanaManager

CCD, Head Office

Sunil Prasad GorkhaliManager

Branch Manager, New Road Branch

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  Gyem Raj AdhikariManager

Executive Operating Officer

  Ananta RajbhandaryManager

Remittance Promotion / Correspondent Banking Dept., Head Office

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