AN OVERVIEW OF GENERAL BANKING OF IFIC BANK & AIBL BANK WITH THEIR DIFFERENCES

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Assignment On
AN OVERVIEW OF GENERAL BANKING OF IFIC BANK &
AIBL BANK WITH DIFFERENCES
Course Title:
Banking Theory and Practices (BUS 407)
Submitted To:
Ms. Amreta Biswas
Lecturer
Department of Business Administration
Central Women’s University
Submitted By:
Farjana Akhter
ID: 2018-2-16-005
Department of Bachelor of Business Administration
Spring-2021
Date of Submission
May 24, 2021

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INTRODUCTION
General banking is the heart of banking activities. Total banking procedure start
with this department. General banking department perform the core function of
bank operation and it is known as “Retail Banking”. They take the deposits from
the customer and meet their demand for cash honoring their checks. It opens
new accounts, remit funds, issues bank draft and pay order. Account opening
section, Remittance, Checks clearing, Cash, FDR, Accounts section are part of
general banking. It is designed to serve the general people is saving money,
smoothing transactions for commercial people and ensure security of the
precious wealth of the clients lot of important activities.
GENERAL BANKING ACTIVITIES OF IFIC BANK
International Finance Investment and Commerce (IFIC) Bank is a
Conventional Private Commercial Bank. It has all the required sections of
general banking activities come under General Banking section of IFIC Bank
are as follows:
ACCOUNT OPENING SECTION
This section is very important for the bank because banks success and failure
largely depend on their customers. If customer is bad, they may create fraud and
forgery by their customers. If customers are bad, they may create fraud and
forgery by their account with bank and thus destroy goodwill of banks. So; this
section takes extreme caution in selecting its customer base.
Accounts opening process:
Step 1 Receiving filled up application in bank’s prescribed form mentioning
what type of account is desired to be opened.
Step 2 1. The form is filled up by the applicant himself/herself
2. Two copies of passport size photographs from individuals are
taken; in case of firms photographs of all partners are taken.
3. Applicants must submit required documents.
4. Applicants must sign specimen signature sheet and give mandate.
5. Introducer’s signature and accounts number-verified by legal
officer.

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Documents needed from the Account opener of the following types:
Partnership
Firm
1. Partnership deed must be taken
2. Mandate from the partners is essential-indicating who will
operate the account.
Public limited
company
1. Certificate of incorporation
2. Copy of Memorandum and articles of association
3. Certificate of commitment
4. Copy of Resolution of the Board of Directors.
Private limited
company
Certificate of Commencement is not necessary
Types of Account maintained by IFIC Bank
Current Deposit Accounts (CD)
 Generally opened by businessmen
 No interest is provided for deposited amount.
 Minimum opening balance is TK.5000. If it falls below TK.1000 an
incidental charge of TK 50 is charged.
Savings Bank Deposit Accounts (SB)
 Any one expects limited company can open.
 6% interest is provided to depositors.
 Minimum balance is Tk1000.
 Twice withdrawal in a week is allowed, for more withdrawal depositors is
not entitled any interest.
Fixed Deposit Receipts (FDR)
 Can be opened by all
 12.5% interest is providing the deposit 1 year.
 In case of withdrawal before maturity the pervious maturity period is
considered to pay interest-it is known as Break Down Payment.
Step 3 Authorized officer accepts the application
Step 4 Minimum balance is deposited – only cash is accepted
Step 5 Account is opened and a cheque book and pay-in-ship book is given.

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Short Term Deposit (STD)
 Generally opened by big business firm.
 Interest depends on the amount deposited.
Interest rate
SL NO DETAILS EXIXSTING
RATES
REVISED RATES
WITH EFFECTIVE
FROM 27/05/09
1 Less than TK 1.00 crore 4.00% 4.00%
2 TK 1.00 crore and avobe
but less than TK 5.00 crore
4.25% 4.25%
3 TK 5.00 crore and above 5.00% 4.75%
4 Bank to Bank 0.50% 0.50%
5 Initial Public
offering(IPO)
5.00% 4.75%
Fixed Deposit Receipt (FDR)
IFIC Bank maintains a separate section for fixed deposit. FDR is an important
factor for the bank and volume of FDR determines the investment base of the
bank. FDR is found to be 60% of the total deposit of this branch. Basically this is
the mobilization unit of the bank. It is obvious to give due importance.
Types of FDR maintained along with their respective interest rate
Fixed Deposit Rate of interests effect from 27/05/09
1months 7.00%
3months 9.00%
6months 9.25%
One year 9.50%
Liquidation of FDR
1. Only the amount holder himself and the authorized person can liquid the FDR
after maturity.
2. In case of joint name, authentication from both is necessary.
3. In case of ‘Either of Survivorship’ clause – anyone can liquid.
4. In case of Death, the survivor cannot encase the FDR even if there exist the
either or survivor clause-succession certificate from the court is needed.

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5. If demanded before the maturity the last expired duration is considered to pay
interest.
REMITTANCE DEPARTMENT AND CHEQUE CLEARING:
This department receives cheque from its depositors for the purpose of
collection by a deposit slip over the counter crediting their account. Clearing of
cheque is done through the clearinghouse in Bangladesh bank. Every day the first
house starts at 9 a.m. and returns house at 5 p.m.
The main objective of clearing and remittance department is to provide an extra
facility to the customer other than cash receipt and payment. We can divide this
department into two parts. One is Clearing & Transfer Delivery section, and the
other one is Local Remittance section. In IFIC Bank, Mirpur Branch, there are
three employees, working in this department. I am trying to present my findings
in the following parts regarding these two sections.
REMITTENCE
Remittance can be done by telegraph transfer, mail transfer, traveler’s cheque
and drafts and cheque. There are two steps of remittance:
Local Remittance
Sending money from one place to another place for the customer is another
important service of banks. And this service is an important part of country’s
payment system. For this service, people, especially businessmen can transfer
funds from one place to another place very quickly. There are five kinds of
techniques for remitting money from one place to another place. These are:
1. Money Transfer
2. Pay Order
3. Demand Draft
4. Telephone Transfer
5. Mail Transfer – Time consuming and not frequently used
Money Transfer
IFIC Bank Ltd. earns a huge amount of money by selling several customer
services.

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Demand Draft (DD)
DD is the most popular instrument of remitting fund. It is an order to pay money
drawn by one branch of a bank upon another branch of the same bank for a
particular sum of money which is payable to order and demand.
Issuing of a Demand Draft (DD):
The steps of issuing a DD to be followed:
 The applicants have to fill up the relevant part of the prescribed
application form duly signed & give it to the officer of the remittance
department.
 The officers fill up the commission & VAT (15% on commission) part
meant for the bank’s use & request the applicant to deposit the amount by
cash I cheque to the cash. By that time the authorized officer get the ‘Test
Number.’
 The cash departments complete their formalities & then return back the
form to the remittance department.
 After receiving the form the remittance departments prepares the DD
facing all the information along with the amount in two parts & also give
entry in the DD issue register.
 After signed the two part of DD by two authorized officer of the bank the
main part is given to the client & after signed at the back of the counter
part of the DD.
 When the DD is given to the client, remittance department prepares the
necessary advice.
Payment Order (PO)
A payment order is an instrument from one branch to another of the same bank
to pay specified sum of money to the person named therein of his order. Unlike
cheque, there is no possibility of dishonoring pay order because before issuing
bank takes our money of the pay order in advance.
Amount of DD Commission (TK)
TK 0 to TK. 1000 10
TK. 1000 to TK. 100000 25

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TK 100000 to TK 500000 50
Above TK. 500000 100
Issuing of a Pay Order:
The steps of issuing a Pay Order to be followed by the client & the bank
 The applicants have to fill up the relevant part of the prescribed
application form duly signed & give it to the officer of the remittance
department.
 The officers fill up the commission & VAT (15% on commission) part
meant for the bank’s use & request the applicant to deposit the amount by
cash I cheque to the cash.
 The cash department completes their formalities & then returns back the
form to the remittance department.
 After receiving the form the remittance department prepares the Pay
Order facing all the information along with the amount in three parts duly
crossed “A/c payee” in the main part & also give entry in the Pay Order
issue resister.
 After signed the three parts of Pay Order by two authorized officer of the –
bank two Ws are given to the client & after signed at the back of the
counter part of the Pay Order.
Telegraphic Transfer (TT)
TT is the fastest means of money transfer between two branches of the same
bank. The formalities of TT is as same as MT, there are taken some extra charge
for telephone.
Telegraphic and Telephone transfer are almost the same, both are them are
known as TT in short. IFIC bank helps people transfer their money from one
district to another in the quickest possible time at the lowest service charge.
Cancellation of DD/PO/TT
Step 1 Application in written to the Manager of the account maintain branch.
Step 2 Verification of the specimen signature.

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Step 3 Journal positing Incoming Bills payable DD payable A/C—DR
IFIC General A/C—–CR
Outgoing IFIC General A/C—– DR D
Bills payable DD payable A/C —–CR Party A/C
Step 4 Step letter to the paying bank.
CLEARING
According to the Article 37(2) of Bangladesh Bank Order 1972, the banks, which
are the member of the clearinghouse, are called as Scheduled Banks. The
scheduled banks clear the cheque drawn upon one another through the
clearinghouse. This is an arrangement by the central bank where everyday the
representative of the member banks gathers to clear the cheque. Banks for credit
of the proceeds to the customer’s accounts accept cheque and other similar
instruments. The bank receives many such instruments during the day from
account holders. Many of these instruments are drawn payable at other banks. If
they were to be presented at he drawer banks to collect the proceeds it would be
necessary to employ many messengers for the purpose, Similarly there would be
many cheque drawn on this the messengers of other banks would present bank
and then at the counter. The whole process of collection and payment would
involve considerable labor, delay, risk and expenditure. All the labor, risk, delay
and expenditure are substantially reduced by the representative of all the banks
meeting at a specified time, for exchanging the instruments and arriving at the
net position regarding receipt or payment. The place where the banks meet and
settle their dues is called the Clearinghouse. The clearinghouse sits for two times
a working day. The members submit the climbable cheque, in the respective
desks of the banks and vice versa. Consequently the debit credit entries are
given. At the debit summation and the credit Summation are calculated. Then the
banks clear the balance through the cheque of Bangladesh Bank. The dishonored
cheque are sorted and returned with return memo named ‘Memorandum’.
CASH SECTION
Cash department is the most vital and sensitive organ of the branch as it deals
with all kinds of cash transactions. This department starts the day with cash in
vault. Each day some cash that is opening cash balance are transferred to the
cash officers from the cash vault. Net figure of this cash receipts and payments

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are added to the opening cash balance. The figure is called closing balance. This
closing balance is then added to the vault. And this is the final cash balance figure
for the bank at the end of any particular day.
Functions of Cash Department
Cash
Payment
1. Cash payment is made only against check
2. This is the unique function of the banking system which
is known as payment on demand
3. It makes payment only against its printed valid check
Cash
receipt
1. It receives deposits from the depositors in form of cash
2. So it is the mobilization unit of the banking system
3. It collects money only its receipts form system
Cash Payment Or Check Cancellation Process
Step 1 Receiving Check by the employee in the cash counter
Step 2 Verification of the followings by the cash Officer in the computer section
1. Date of the check (it is presented within 6 month from issue date)
2. Issued from this branch
3. Amounts in figure and sentence written does not differ
4. Signature of the drawer does not differ
5. Check is not torn or mutilated
Step 3 Gives pay cash seal and sends to the payment counter
Step 4 Payment officer makes payment
Books Maintained by this Section
Vault Register Cash balance at the end of a day is recorded in this book
which is kept in the vault.
Cash Receipt Register Cash receipt in whole of the day is recorded here
Cash Payment
Register
Cash payments are made in a day are entered here

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GENERAL BANKING ACTIVITIES OF AIBL BANK
Al-Arafah Islami Bank Limited (AIBL) Bank is an Islami Shariah Based
Private Commercial Bank. In Islamic banks the following departments are
under general banking section:
1. Account opening section
2. Cash section
3. Remittance section
4. Clearing section
ACCOUNT OPENING
Account opening section is an important factor for banks because customer is the
main source of bank. Selection of customer is another important factor. Bank’s
success and failure largely depends on their customers. If customer is not good
then may create fraud and other problems by their account with bank and thus
destroy goodwill of banks. Therefore, bank must be conscious in selecting its
customer. For this reason Al-Arafah Islami Bank Ltd. keep key information
system.
Accounts Opening Process:
Recently, Bangladesh Bank has been declared, designed and enforced a unique
format of form for every banks. This format should hold the important document
in a same manner and process respectively for different kind of accounts. Al-
Arafah Islami Bank Ltd. is not different from this practice. Accounts opening
process can be as follows:
Step 1  Receiving filled up application in bank’s prescribed form
mentioning what type of account is desired to be opened.
 The form is filled up by the applicant himself/ herself.
 Two copies of passport size photographs from individual are
taken and in case of firms photographs of all partners are
taken.
Rough Vault Register Cash calculation for final entry in vault register is done
here, as error and correction here is not acceptable in
vault book or balance book.
Cash Balance Book Balance here is compared with vault register. If no
difference is found, indicates no error.

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 Officer are taken information from customer by key
information system
Step 2  Applications must submit required documents.
 Applications must sign specimen signature sheet and give
mandate.
 Introducer’s signature and accounts number-verified by legal
officer.
Step 3  Filling & signing up KYC or Know Your Customer Form
 Filling TP or Transaction Profile.
 Filling & signing up Owner Information Form
Step 4  Authorized Officer accepts the application
Step 5  Minimum balance is deposited-only cash is accepted
Step 6  Account is opened and a cherub book and pay-in-slip book is
given
Various Types of Deposit Account:
Al-Arafah Islami Bank Ltd. offers following types of deposit account, those are:
Mudaraba Savings Deposit Account (MSD)
To maintain smooth and certain life in future Mudaraba Savings Deposit Account
is very suitable for middle class groups. The attributes of this are:
 500/- is the minimum amount of initial deposit.
 Client cannot withdraw money more than twice a week,
 The profit rate is 8% against MD account
 For opening of this type of accounts following requirements are
necessary:
o The introducer must be attested photograph.
o The introducer must be account holder of Al-Arafah Islami Bank
Ltd.
Al-Wadia Current Deposit Account
Al-Wadia Current Deposit Account facilitates the account holder to draw money
at any times but no profit is given to the current account deposited money. This
can be opened by any individual or joint or any name of proprietorship business,
private limited company or public limited company, association, clubs, societies,
trusts etc. Generally, current account is opened for businessman and traders for
easy transaction. By taking this liability, Al-Arafah Islami Bank Ltd. takes a
service charge of Tk. 100 for six months.

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Mudaraba Term Deposit Receipt Account (MTDR)
It's a certain period deposited system, which is not repayable before the maturity
date of a fixed Period. Al-Arafah Islami Bank Ltd. offers higher rates of profit on
such deposits. Usually customers are allowed to open this account for a certain
period and the rate of profit in accordance with the terms of the deposit. The
features of this scheme as follows:
 Minimum balance: TK 10000.00
Particulars 3 months 6 months 1 year
Profit 12.50% 12.50% 12.50%
Short Notice Deposit Account (SND)
Short Term Deposit has following attributes:
 6% profit rate against STD.
 No restriction over withdrawal of money
 1000/- is the minimum balance.
Installment Term Deposit (ITD)
Installment Term Deposit (ITD) is a sure investment for a steady return. It can be
opened for2, 5, 8, 10, or 12 years for Tk. 200, Tk. 300, Tk. 500, Tk. 1000, Tk. 1500
and Tk 2000. The savings amount is to be deposited any day of the month. If the
depositor has a separate account in the bank for which a standing instruction can
be given to transfer the monthly deposit in the schemes’ account. In case of
failure to make the monthly installment in the schedule time 5% on overdue
installment amount will be charged. The lowest charge will be Tk. 10 and this will
be added with the following monthly installment. After 3 years of savings in this
schemed the depositor is eligible for a loan up to 80% of his deposited amount.
 Highlights of the Scheme
→ Mudaraba Lakhpoti Scheme
→ Mudaraba Millionaire Scheme
→ Mudaraba Kotipoti Scheme
Mudaraba Lakhpoti Scheme: For Mudaraba Lakhpoti Scheme 3, 5, 8, 10, 12
year’s monthly installments are Tk. 2,375, Tk. 1,275, Tk. 670, Tk. 460 and Tk. 335
respectively and will get Tk. 1 lac.

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Mudaraba Millionaire Scheme: For Mudaraba Millionaire Scheme 3, 4, 5, 6, 7,
10, 12, 15 and 20 year’s monthly installments are Tk. 23,950, Tk. 16,950, Tk.
12,750, Tk. 9,950, Tk. 8,000, Tk. 4,600, Tk. 3,345, Tk. 2,170 and Tk. 1,150
respectively and will get Tk. 10 million.
Mudaraba Kotipoti Scheme: This is the most popular & target oriented
schemes. One can open for 3,4,5,6,7,10,12,15,18,20 years and have to pay
(Monthly installment) Tk. 2,39,500, Tk. 1,69,500, Tk. 1,27,500, Tk. 99,500, Tk.
80,000, Tk. 46,000, Tk. 33,450, Tk. 21,485, Tk. 14,330 and Tk. 11,100 respectively
and will get Tk. 1 crore.
 Condition of these Schemes
o By filling up a form an account is opened.
o A non-transferable deposit receipt will provide to the customer
after opening the account.
o If the deposit is withdrawn before a 5-year term, then saving
interest rate will be applicable and paid to the depositor. However,
no in profit paid if the deposit is withdrawn within 1 year of opening
the account and Monthly Income paid to the customer will be
adjusted from the principal amount.
o This scheme will be credited to the loan account until liquidation of
the loan amount inclusive of profit. A depositor can avail loan up to
80% of the deposit amount under this scheme.
Mudaraba Double Deposit Scheme: Savings works as the very foundation of
development. Savings is the prime source of business investment in a country. So
it helps to build up capital. To create more awareness and motivate people to
save, Al-Arafah Islami Bank Ltd. offers Mudaraba Double Deposit Scheme. Here
people put their money for double return after 6years.
 Conditions of the Scheme
o The deposit can be made in multiplies of TK. 10000.00.
o This is 6 years period deposit. The deposit cannot be
withdrawn at any time with in the maturity date.
Mudaraba Special Savings Schemes:
Mudaraba Hajj Savings Scheme
AIBL has introduced a Scheme in the name & style of ‘Mudaraba Hajj Savings
Scheme’ to facilitate the intending Muslims to perform Hajj properly at
appropriate age. This is purely a savings scheme for performing Hajj. Any Muslim

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intending to perform Hajj by building-up deposit required for meeting Hajj
expenses will select one of the 25 alternative choices based on duration of period
from 1 year to 25 years for building-up savings by monthly installments under
this Scheme.
Mudaraba Savings Bond Scheme
Person(s) aged 18 years and above shall be eligible to purchase Mudaraba
savings Bond(s) in single name or in joint names. Educational institutions, Clubs,
Associations and other non- trading and non-profit socio-economic institutions
shall also be eligible to purchase Bond(s) in the name of institutions. Guardian(s)
shall be allowed to purchase Bond(s) jointly with a minor mentioning the age of
minor. Mudaraba Savings Bond shall be available in Tk.1000, Tk. 5000, Tk.
10000, Tk. 25000, Tk.50000, Tk. 100000, Tk.500000, and Tk. 1000000
denominations.
Terms: 5(five) years and 8(eight) years.
Mudaraba Special Savings (pension) Scheme
Considering increasing demands from the people of all walks of the country for
special & attractive savings schemes on the basis of the Islamic Shariah so as to
enable and encourage them to save as per their capacity in Islmic way for their
old age when they will normally retire from their active economic life, AIBL has
introduced “Mudaraba Special Savings (pension) Scheme” in which a person gets
the opportunity to build-up savings by contribution small monthly installments
for getting an attractive amount at the end of a specified term or a monthly
amount for a specific period after the expiry of the term. Term: 5 years and 10
Years. Under this scheme account may be opened for monthly deposits of Tk.
200, Tk. 300, Tk. 400, Tk. 500, Tk. 600, Tk. 700, Tk. 800, Tk. 900, Tk. 1000 and
multiple of thousand Taka up to Taka 20,000 only.
Mudaraba Monthly Profit Deposit Scheme
Any individual may open Account under this Scheme by depositing a minimum
amount of tk. 1,00,000/- and multiples thereof at a time for 3 or 5 years.
Monthely provisional profit shall be given to the account just after completion of
30 dayesfrom the date of opening of the account. The profit amount will be
adjusted on completion of each accounting year after declaration of final rate of
profit.

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Mudaraba Muhor Savings Scheme
AIBL has introduced ‘Mudaraba Muhor savings Scheme’ which has been designed
for all classes of people particularly the professionals & service-holders aiming to
create an opportunity for them to save in monthly installments according to their
capability for building up sufficient fund in order to meet the obligation of Muhor
to their wives and to protect the rights of the women Ensured by the religious
faith. The Scheme is of 2 (two) different terms, 5 years and 10 years. Accounts
under this Scheme may be opened for monthly deposit of Tk. 500, Tk.1,000. Tk.
2,000, Tk. 3,000, Tk.4,000 and Tk. 5,000 only. Any married bonafide citizen of the
country with sound mind may open Account in his wife’s name.
Mudaraba Waqf Cash Deposit Account
The Bank has introduced ‘Mudaraba Waqf Cash Deposit Account’ through which
savings made from earnings for the purpose of Waqf by the well-off and the rich
people of the society can be mobilized and the income to be generated there from
may be spent for different benevolent persons. Through the Scheme the Bankwill
be able to contribute to popularize the role of Waqf in the country including Cash
Waqfe which will be instrumental in transferring savings of the rich to the
members of the public, in financing various religious, educational and social
services of various social investment projects. Under this Scheme one may create
Cash Waqf at a time or may start with a minimum deposit of Tk. 10,000/- only
and the subsequent deposit shall be made by installment(s) in thousand Taka or
in multiple of thousand Taka. Higher profit is given against this Account is
utilized for social and human welfare as per instruction of the Account holders.
Mudaraba Foreign Currency Deposit Scheme
Mudaraba Foreign Currency Deposit Scheme (savings) has been introduced
under Mudaraba principle and endeavoring to invest the foreign currency funds
in profitable way through its foreign correspondent Banks under Shariah
principle so as to enable the Bank to pay profit to its FC/PFC depositors, who will
intend to open/maintain Mudaraba Foreign Currency Deposit (MFCD) Account in
minimum $ 1,000/=
Information Collected to Open Account:
Accounts opening information that is collected by the Al-Arafah Islami Bank Ltd.
varies for each type of account.

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Individual
→ Name of account holder
→ Present and Permanent Address of A/C holder
→ Sigh of account holder
→ Date of birth and age
→ Nationality
→ Taxpayer Identification Number (TIN- if available)
→ Passport or certificate provided by the employer
→ Introducer
→ Photograph of the account holder duly attested by the introducer.
→ One photograph of the nominee duly attested by the account holder.
→ Nominee declaration form
→ Nominee Sign
→ Money laundering leaflet
Partnership Firm
→ All the required information mentioned for Individual Accounts; along with,
→ Copy of Partnership Dead
→ Mandate from the partners is essential – indicating who will operate the
account.
Limited Company
→ All the required information mentioned for Individual Accounts; along with,
→ Certificate of Incorporation
→ Copy of Memorandum and Article of Association
→ Certificate of Commencement
→ Copy of Resolution of the Board of Directors

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Account related information of Panthapath branch:
January-
April
May-
August
September-
December
Current Account 85 97 120
Savings Account 196 213 235
MTDR 343 417 511
Others 68 80 99
Total 692 807 965
As a new branch of panthapath number of account is low. But the number of
account number is increasing day by day. Because the account number of
December is more than October.
Dormant Account
If any account is inoperative for more than one year is called dormant account.
To operate these accounts manager permission is necessary.
Transfer of Account
An account can be transferred from branch to branch and only from the same
bank. Following steps are considered for this purpose:
 Application in written to the Manager of the account maintaining branch
 Manager sends a request to the manager of the desired branch of
depositors
 Sends original Account opening application and specimen signature sheet
with the balance remained in the account at he sent Manager’s request
 New account is opened at desired branch.
0
100
200
300
400
500
600
Current A/C Savings A/C MTDR Others
A/C In Panthapath
Jan-Apr
May-Aug
Sep-Dec

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CASH SECTION:
The most vital and important section of the branch is Cash Department. It
deals with all kinds of cash transactions. This department starts the day with
cash in vault. Each day some cash that is opening cash balance are transferred
to the cash officers from the cash vault. Opening cash balance is adjusted by
cash receipts and payments. This figure is called closing balance. This balance
is then added to the vault. This is the final cash balance figure for the bank at
the end of Library any particular day. There is an important clause and duty
practiced by the branch is to refund the principal amount that exceeds more
than Tk. 1 crore at the principle branch of the bank.
Books Maintained By This Section:
 Vault Register: It keeps account of cash balance in vault in the bank.
 Cash Receipt Register: Cash receipt in whole of the day is recorded
here.
 Cash Payment Register: Cash payments are made in a day are entered
here.
 Rough Vault Register: Cash calculation for final entry in vault register is
done here as any error and correction here is not acceptable.
 Cash Balance Book: Balance here is compared with vault register. If no
difference is found, indicates no error.
Cheque Cancellation or Cash Payment Process:
Step 1  Receiving Cheque by the employee in the cash counter
 Verification of the followings by the cash Officer in the
computer section
Step 2  Date of the Cheque (present within 6 months from issue date)
 Issued from this branch
 Amounts in figure and sentence written does not differ
 Signature of the drawer does not differ
 Cheque is not torn or mutilated
Step 3  Gives pay cash seal and sends to the payment counter
Step 4  Payment officers make payment
REMITTANCE
Sending money from one place to another through some charges is called
remittance. To pay or receive money of customers in the form of remittance from

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one place to another, from one person to another inside and outside the national
boundary is an earning source of every bank.
Panthapath Branch, Al-Arafah Islami Bank Ltd. operates both the foreign and
local remittance to serve its customers. In addition, this service is an important
part of country’s payment system. Through this service, people can transfer their
funds from one place to another place very quickly.
Foreign Remittance
Foreign remittance is to send money of customers from one place to another,
from one person to another outside the national boundary. Though Panthapath
Branch, Al-Arafah Islami Bank Ltd. Is a non-ad branch, it can able to serve the
customers by receiving and paying their incoming foreign remittance in the form
of local currency. Foreign remittance is received by the bank via some
internationally authorized agents. There are two medium of agent for foreign
remittance at Panthapath Branch, Al-Arafah Islami Bank Ltd.; they are:
Moneygram
Moneygram is a money transfer medium/agent serves both domestic &
international services. Its identification number consists 12 digits.
Local Remittance
Sending money of customers in the form of remittance from one place to another,
from one person to another inside and outside the national boundary is another
earning source of every bank. As being a non-ad branch Panthapath Branch of Al-
Arafah Islami Bank Ltd. Only operates the local remittance to serve the
customers. In addition, this service is an important part of country’s payment
system. Through this service, people can transfer their funds from one place to
another place very quickly. There are several techniques for collecting local
remittance. These are:
 Pay Order
 Demand Draft (DD)
Pay Order
Pay order gives the payee the right to claim payment from the issuing bank. It is
payment from issuing branch only within the clearing house area of issuing
branch. Payment is made through clearing.
 Examine gentility of the pay order.

20. 20 | P a g e
 Enter into Pay Order register and give contra entry
 Debit, if the fund is sufficient then it is OK for payment.
Charges of pay order are shown in bellow by a chart:
Amount of P.O. Commission VAT Total
1-100000 20 3 23
100001-500000 30 4 34
500001-1000000 50 8 58
1000001-Above 100 15 115
Demand Draft (DD)
This is an instrument through which customer’s money is remitted to another
person/ firm/organization in outstation (Outside the clearing house area or
from one district to another). Demand Draft Payment is made through the
following process:
 Confirm that the DD is not forged one.
 Confirm with sent advice.
 Check the “Test Code”
 Make payment
CHEQUE CLEARING:
Bank receives all kinds of cheque in favor of the client for clearing. When cheque
is received it is necessary to endorse it and cross it specially.
Types of Cheque Explanation Clearing Process
Clearing Process Cheque received from
the clearing house of
Al-Arafah Islami Bank
Ltd.
Party’s A/c…Dr. Al-Arafah Islami
Bank Ltd. General A/c…Cr
OBC(Outward
Bills for
Collection)
Cheques of other
branch of Al-Arafah
Islami Bank Ltd.
Within its clearing
house area.
These cheques are directly sent to
the respective branch and request
them to send IBCA. When it comes,
then customer’s A/c is credited for
the cheque.
Clearing Cheque Cheques for another
bank outside the
clearing area
These cheques are sent to clearing
house via Panthapath Branch. When
drawee bank honor the cheques,
then the account of cheque
depositors are credited.
Outward Cheques for another If any branch of Al-Arafah Islami

21. 21 | P a g e
Clearing bank outside the
clearing area
Bank Ltd. Exists within the clearing
house area of drawee bank then Al-
Arafah Islami Bank Ltd. Send the
cheque to that branch of Al- Arafah
Islami Bank Ltd. And sends IBCA to
it.
Inward Bills for
Collection (IBC)
From other branch of
Al- Arafah Islami
Bank Ltd.
These cheques are settled by IBCA,
i.e. debiting depositor’s account and
crediting sender’s
From another bank
outside the clearing
house
These cheques are settled debiting
depositor’s account and sending DD,
MT, TT in favor of sender’s bank.
Clearing Department:
Cheques clearing section of Al-Arafah Islami Bank Ltd. receives cheque, demand
drafts and pay orders of their clients. Upon the receipt of the instrument the
cheque clearing section examines three types of payment modules.
 Whether the Paying Bank within Dhaka City: The cheques clearing section
of Al-Arafah Islami Bank Ltd., Panthapath Branch sends Inter Branch Debit
Advice (IBDA) to the head office on the receiving day of the instruments.
The main branch takes those instruments to the clearing house on the
following day. If the instruments are dishonored, Head Office of Al-Arafah
Islami Bank Ltd. sends IBDA to the Al-Arafah Islami Bank Ltd., Dhanmond
Branch.
 Whether the Paying Bank of their own branch: The cheque clearing section
of Al-Arafah Islami Bank Ltd., Dhanmondi Branch sends Outward Bills for
Collection (OBC) to the concerned paying branch to get Inter Branch Credit
Advice (IBCA) from the paying branch. If the paying branch dishonors the
instrument, the paying branch returns it to the Al-Arafah Islami Bank Ltd.,
Dhanmond Branch describing why the instrument is dishonored.
Charge of Clearing
AIBL Bangladesh Bank VAT Total Cost
High Value 25 25 8 58
Normal Value 3 3 2 8

22. 22 | P a g e
If a customer drops a cheque in clearing section he/she need bear those costs. Itis
noted that more than 5 (five) Lac Tk. cheque is high value. And less than 5 (five)
Lac Tk Cheque is normal value cheque. If any cheque dishonors 115 Tk. Extra
charge is need.
COMPARISON BETWEEN IFIC BANK AND AIBL BANK
International Finance Investment and Commerce Bank Limited and Al-Arafah
Islami Bank Limited, both are financially sound banks in Bangladesh. They will be
financially compared on the basis of following points:
 Total Capital
 Total Assets
 Total Deposits
 Return on Equity (ROE)
 Return on Assets (ROA)
 Earnings per share
Total Capital
Total capital usually refers to the sum of long-term debt and total shareholder
equity; both of these items can be found on the company's balance sheet.
Amount in Taka
Name of The
Banks
2020 2019 2018
AIBL 24,199,864,824 24,148,210,654 20,440,000,000
IFIC 27,823,915,093 26,542,970,473 22,116,000,000
AIBL
BB
VAT
0
10
20
30
High Value Normal Value
Cost of Clearing
AIBL
BB
VAT

23. 23 | P a g e
In case of total capital, International Finance Investment and Commerce Bank
Limited is in better position in the last three years.
Total Assets
Total assets are the sum of all current and noncurrent assets that a company
owns.
Amount in Taka
Name of The
Banks
2020 2019 2018
AIBL 410,132,401,406 381,051,811,953 338,465,300,000
IFIC 368,029,566,161 316,950,000,000 283,073,000,000
Al-Arafah Islami Bank Limited has more total asset than International Finance
Investment and Commerce Bank Limited in the past three years which makes it
more financially sound bank.
0
10,000,000,000
20,000,000,000
30,000,000,000
40,000,000,000
50,000,000,000
60,000,000,000
2020 2019 2018
IFIC
AIBL
0
50,000,000,000
100,000,000,000
150,000,000,000
200,000,000,000
250,000,000,000
300,000,000,000
350,000,000,000
400,000,000,000
450,000,000,000
2020 2019 2018
AIBL
IFIC

24. 24 | P a g e
Total Deposits
Total deposit is the money placed into a banking institution for safekeeping. Bank
deposits are made to deposit accounts at a banking institution, such as savings
accounts, checking accounts and money market accounts.
Amount in Taka
Name of The
Banks
2020 2019 2018
AIBL 281,427,075,411 268,955,411,879 266,205,480,000
IFIC 293,799,226,264 256,339,984,836 226,364,000,000
Al-Arafah Islami Bank Limited holds more deposits rather than International
Finance Investment and Commerce Bank Limited which helps it to be financially
stronger.
Return on Equity (ROE)
Return on Equity is the amount of net income returned as a percentage of
shareholders equity. Return on equity measures a corporation's profitability by
revealing how much profit a company generates with the money shareholders
have invested.
Name of The
Banks
2020 2019 2018
AIBL 13.41% 10.05% 10.46%
IFIC 2.3% 10.5% 7.36%
0
50,000,000,000
100,000,000,000
150,000,000,000
200,000,000,000
250,000,000,000
300,000,000,000
2020 2019 2018
AIBL
IFIC

25. 25 | P a g e
International Finance Investment and Commerce Bank Limited is doing good in
case of Return on Equity (ROE).
Return on Assets (ROA)
Return on Assets (ROA) is an indicator of how profitable a company is relative to
its total assets. ROA gives an idea as to how efficient management is at using its
assets to generate earnings.
Name of The
Banks
2020 2019 2018
AIBL 0.93% 0.64% 0.73%
IFIC 0.60% 0.88% 0.58%
Al-Arafah Islami Bank Limited had quite good ROA in 2019 and 2018. In 2020, it
has ROA of 0.93%. And Al-Arafah Islami Bank Limited was holding better ROA
than International Finance Investment and Commerce Bank Limited in 2020. It
indicates that AIBL Bank improves and retains their ROA over time. It makes
them better company.
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
2020 2019 2018
IFIC
AIBL
0.00%
0.10%
0.20%
0.30%
0.40%
0.50%
0.60%
0.70%
0.80%
0.90%
1.00%
2020 2019 2018
AIBL
IFIC

26. 26 | P a g e
Earnings Per Share
Earnings per share is the portion of a company's profit allocated to each
outstanding share of common stock. It serves as an indicator of a company's
profitability.
Amount in Taka
Name of The
Banks
2020 2019 2018
AIBL 1.35 2.28 2.35
IFIC 0.70 1.75 1.23
In account of EPS, International Finance Investment and Commerce Bank Limited
is in better position than Al-Arafah Islami Bank Limited.
CONCLUSION
Banking sector of Bangladesh consists of several nationalized and private banks.
They are doing their activities and highly contribute to the national economy.
Among Al-Arafah Islami Bank Limited and International Finance Investment and
Commerce Bank Limited also make significant contribution to the economy. They
are performing their activities, as a result not only the bank but also the economy
is benefited. The banks are performing general banking, Loan-advance, foreign
exchange activities etc, as a result they are mobilizing the money and do well for
the economy. Although they have some limitations in their services, they are
doing tremendous job for the economy. If they can reduce their limitation and
introduce new ideas, they can do better in the banking sector of Bangladesh.
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
2020 2019 2018
IFIC
AIBL

27. 27 | P a g e
Comparing these two banks is not a easy task. They have their own system and
Al-Arafah Islami Bank Limited follows Islami Banking. Al-Arafah Islami Bank
Limited is in way better position in case of Total assets, Total deposits, and
Return on Assets (ROA). But when it comes with Total Capital, Return on Equity
(ROE), and Earning per Share (EPS), International Finance Investment and
Commerce Bank Limited is holding much better than Al-Arafah Islami Bank
Limited which proves of having better portability.