Credit Management of Rajshahi Krishi Unnayan Bank: A Case Study on Saddapushkaruni Branch, Rangpur

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1.1 Introduction
Generally by the word “Bank” we can easily understand that the financial institution
deals with money. A bank is an organization that offers various types of deposits
account to its customers and makes a variety of loans services. It also provides a wide
range of services like foreign trade financing, online banking, credit cards, debit
cards, utility service etc. Bank acts as an intermediary between the surplus sector and
deficit sector by supplying surplus money to the deficit sector for investments and
financing. Mainly bank is a commercial organization and commercial bank plays
important role in the economic development of the country.
For an economy money is one of the most important and essential elements which can
be compared with blood of our body when financial institution like bank act as a
artery system of the economy. Banking system occupies an important place in a
nation’s economy because of its intermediary role; it ensured allocation and keeps up
the momentum of economic activities. Bangladesh economy has been experiencing a
rapid growth since the 90’s. From the beginning to today bank is playing an important
role in our economy. For the local community, banks provide access to funding and
financial services to both local business and citizens, as well as the money banks
invest back into the community through employee payroll, business investments, and
taxes.
First of all banks cater the need of society by mopping up deposits as different forms
like savings, MSS, FD, SND and many other options at reasonable rates. Also bank
provide credit facility to high end investors for big projects in the industrial,
infrastructure and service sectors.
Rajshahi Krishi Unnayan Bank is a state owned commercial bank in Bangladesh
which undertakes all types of banking transactions to support the development of
trade and commerce of the country. The management of the bank constantly focuses
on understanding and anticipating customers’ needs. The scenario of banking business
is changing day by day, so the bank’s responsibility is to device strategy and new
products to cope with the changing environment. Rajshahi Krishi Unnayan Bank
offers different types of corporate and personal banking services involving all
segments of the society within the purview of rules and regulations laid down by the

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central bank and other regulatory authorities. However, we studied on Customers’
Perception and Satisfaction of Service Quality of Rajshahi Krishi Unnayan Bank. We
try to prove actual or perceived customer expectation and perception of the service
offered by the Rajshahi Krishi Unnayan Bank. In the following, after a brief review
and discussion of the service quality we try to point out possible recommendations for
the improvement of service quality of Rajshahi Krishi Unnayan Bank.
1.2 Origin of the report
Present world is changing rapidly to face the challenge of competitive free market
economy. To keep pace with the trend banks need executive with modern knowledge.
To provide fresh graduate with modern theoretical and professional knowledge in
banking and financial institution management. This report is oriented as the course
requirement of the courses of BBA Program of Begum Rokeya University, Rangpur.
As the practical origination is an integral part of the BBA degree requirement, I was
sent to Rajshahi Krishi Unnayan Bank (RAKUB) to take the real life exposure of the
activities of banking financial institution from 15th
may 2016 to 14 august 2016.
1.3 Objectives of the study
The objectives of the study are as follows:
1.3.1 General Objective
The general objective of this report is to find out,” The Customer Perception and
satisfaction of service quality of Rajshahi Krishi Unnayan Bank”. The main objective
is to know whether the incumbent customers of this particular organization are happy
with service that they are receiving from the organization. Whether they have any
dissatisfaction concealed in their mind that can hinder the overall performance of the
organization and find out effective measures to ease those factor positively to meet up
the optimum goal of the organization.
1.3.2 Specific Objective
The specific objectives of this report are as follows:
 To know about operational activities of Rajshahi Krishi Unnayan Bank
and to understand the existing circumstance of the bank.
 To know the opinion of the customers regarding the existing services.

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 To determine the subsequent progression or depression of the bank in
terms of services offered to customers.
 To identify strength, weakness, threats and opportunity and observe future
growth of prospect.
 To know the employee-customer relationship.
 To know the level of customer’s satisfaction
 To identify the problems behind those activities and to suggest remedial
measures.
1.4 Scope of the Study
This internship program gives me a great scope or opportunity for gather experience
and knowledge in several areas of banking by which I can evaluate or expose myself.
The scope of this report is mostly limited to Rajshahi Krishi Unnayan Bank, as the
report is based on practical observations. For the purpose of my internship program I
was assigned at Rajshahi Krishi Unnayan Bank,Saddapushkaruni Branch,Rangpur. I
have worked as a service intern and try to resolve customer’s problem. Also I worked
in different department of the bank like General banking and Credit division. But it
was not possible to learn all job activities within these three months.
1.5 Methodology of the Study
Generally, methodology is a way to systematically solve the research problem. But
methodology, in a broad sense, may be considered as a combination of various
methods. We have designed this study as an expletory research paper. Here we have
discussed about services quality of and critically Rajshahi Krishi Unnayan Bank
analyze the banking procedure with the standard one as per the theoretical framework.
For this purpose we use personal observation during internship program. Through
conversation and questionnaire we gather knowledge Customers Satisfactions
Perception positive growing techniques. For theoretical framework, we go through a
number of related books, financial management books, business communication book,
Bangladesh Bank guidelines. I have used both primary and secondary data to collect
the information. The overall process of methodology followed in the study is
explained further.

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1.5.1 Selection of the topic
Supervisor assigned the topic of the study. Before the topic was assigned it was
thoroughly discussed so that, a well-organized internship study can be prepared.
1.5.2 Sources of Data collection
1.5.2.1 Primary Sources: Primary data are measurements observed and recorded as
part of an original study. The data, which is collected directly, is called primary data.
When searching in the field directly to collect data is called primary source of data.
The sources of my primary data are as follows-
 Practical desk work.
 Study of the relevant files as instructed by the officers.
 Face to face conversation with officers.
 Face to face conversation with the Customers.
 Facing some practical situation related with the banking activities.
There are two basic methods of obtaining primary sources data,namely:
I. Questionnaire method
II. Observation method
I. Questionnaire method: Questionnaire method is more widely used for
collecting data. When questionnaire method is used, three different technique
of communications with questionnaire are available :(a) personal interview,(b)
mail, (c) telephone. Also, questionnaire method is usually faster and cheaper
than observation method. With the purpose of collecting data, a questionnaire
was prepared according to the direction of my supervisor about “The
Customers Satisfaction and Perception positive growing techniques in favor of
Rrajshahi Krishi Unnayan Bank: A Study on Saddapushkaruni Branch,
Rangpur.”
II. Observation method: Observation method does not automatically produce
accurate data. Under this method, we observe things around us specially my
related field. We have observed many of the activities of the services oriented
queries of the valued customers in the Branch.

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1.5.2.2 Secondary Sources of Data Collection: When an investigator uses the data
which has already been collected by others, such sources or data are called secondary
sources or data. We have collected some secondary information which is already
published by the bank authority. We have collected secondary information from
various annual reports, Statistical report, Books, magazine and papers of Rajshahi
Krishi Unnayan Bank.
1.5.3 Sampling Plan
Sampling is the process of obtaining information about an entire population by
examining only part of it. The researcher quite often selects only a few items from the
universe for his study purposes. The two major sampling methods are probability and
non-probability sampling. The non-probability sampling techniques include
convenience sampling, judgment sampling, quota sampling and snowball sampling.
On the other hand probability sampling methods are random sampling, systematic
sampling, stratified sampling and cluster sampling.
1.5.4 Sampling Elements
Individual Customers of Rrajshahi Krishi Unnayan Bank, Saddapushkaruni
Branch,Rangpur is my elements of research.
1.5.5 Sampling size
Sample size of this study for questionnaire is 50 customers of Rrajshahi Krishi
Unnayan Bank, Saddapushkaruni Branch, Rangpur.
1.5.6 Sampling method
In this research random sampling technique was used to collect data.
1.5.7 Method of Analyzing Data
We have collected data from Rrajshahi Krishi Unnayan Bank, Saddapushkaruni
Branch, Rangpur. After collecting all data we analyzed the data individually. We
present the data through graph, chart, table etc. Based on analysis we made findings,
limitations, recommendations and conclusion.

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1.5.8 Findings of the Study
The collected data were analyzed well and were pointed out and shown as findings at
the end.
1.5.9 Final Report Preparation
The final report is prepared after some valuable suggestions and recommendations
given by my honorable supervisor.
1.6 Limitations of the Study
During groundwork of this study some obstacles came across, which could be termed
as the limitation of the project. Though we have received co-operation from the
concerning body but most of the time they were busy with their work that’s why we
did not get so many time, as we would like to have. These reasons did not allow this
study to go in depth of issues hence several parts of the study is not concentrated.
Therefore the limitations that were faced:
 Every organization has their own secrecy that is not revealed to others. So data
collection was hampered for organizational confidentiality. Also there was risk
of colleting wrong data.
 The main constraint of the study is limited access to data, which hampered the
scope of analysis required for the study.
 Due to the limitation of report size many of the aspects could not be discussed
in the present report
 Since bank's personnel were very busy on customer service time so it was
quite possible to provide sufficient time.
 Another problem is that creates a lot of confusions regarding verification of
data. Most of the cases same person performs various job so it was sometimes
difficult to check the job pattern.
 Actually it is difficult to make a report within three month on foreign
exchange department.

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2.1 General Concept of RAKUB
Rajshahi Krishi Unnayan Bank is a specialized bank, is the largest source of
agricultural credit in Rajshahi division. Establishment of Rajshahi Krishi Unnayan
Bank includes the development of socio-economic condition of the people of the
northwest region of Bangladesh. The bank extends its credit facilities for employment
and income generating agro-based industrial and commercial activities, besides
supplying agricultural credit. Poverty alleviating program and diversified off-farm
rural economic activities apart from these the bank performs other banking functions
as like as commercial banks. RAKUB provides contribution by collecting scattered
small saving from the rural mass in against of attractive interest and allowing credit
facilities to the small and marginal investor as well as the farmers.
2.2 Establishment
Rajshahi Krishi Unnayan Bank (RAKUB) was established by the President's
Ordinance No. 58 of 1986 (later replaced by 'Rajshahi Krishi Unnayan Bank Act,
2014'). It took over the operations of 253 branches of Bangladesh Krishi Bank of the
then Rajshahi administrative division (presently Rajshahi and Rangpur divisions) and
started functioning on March 15, 1987. As on 14-08-2016 there are 379 branches of
the bank including LPO and Dhaka branch among which 191 are in Rajshahi and 184
in Rangpur division. Number of rural branches are 310 while urban 69. RAKUB is the
only specialized nationalized bank having its head office outside Dhaka, i.e. at
Rajshahi.
2.3 Historical Background of RAKUB
At the time of British rule the farmers of this country were exploited in various ways.
Many farmers lost their properties because they could not repay their debt. At that
time, the people of Bengal was included in the “Dadan” business of indigenous
landlord, moneylenders etc, as a results all the belonging of the farmers were sold is
the bid and they had to stay with much difficulties.
In 1947, the Indian subcontinent was freed from the British rule and in Indian sub-
continent two independent countries were originated namely India and Pakistan. Our
Bangladesh was indicated as East Pakistan as a part of Pakistan. Then the Pakistan

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Govt. established a financial institution by the name of Agricultural Development
Finance Corporation (ADFC) to disburse loan is agricultural sectors is 1952. In 1957
then the Pakistan Govt. established another financial institutions namely “Pakistan
Krishi Bank” feeling the agro-production and the importance of agro-loan. This
institution started its function from 1958. After this, in 1961, “Pakistan Agricultural
Development Bank” was established merging with the two state owned loan
institutions and though the disbursement of agriculture-loan, the system of giving
state facilities to the farmers in many ways continuous.
The appearance of Bangladesh made through the “Great liberation war is 16
December 1971. The ‘Pakistan Krishi Unnayan Bank’ was re-named as “Bangladesh
Krishi Unnayan Bank”. After this, the nomenclature of this bank was made as the
“Bangladesh Krishi Bank” with the ordinance number 27 of the president 1973.
With the passage of time, It becomes very difficult for some limited bank to meet up
the multiple demand of loan specially crop-loan. Since Bangladesh is an agro-based
country, the demand for the loan of Krishi Bank has increased remarkably. It becomes
very difficult for a Dhaka based head office of Krishi Bank to manage agro-loan in
the remote areas of the country. For this reason, then the Govt. felt to decentralize the
Krishi Bank in the divisional areas. The people of the Northern areas of Bangladesh
are lagging behind in all respects than other parts of the country. For this reason,
Rajshahi Krishi Unnayan Bank was established in 1986 with the ordinance number 58
of the president. RAKUB started its functioning from 15 March, 1987.
2.4 Management of RAKUB
The board of directors is vested with the responsibility of formulation of policy in line
with attainment of growth in agriculture and economic development of the region
through agricultural credit support. The board of directors is constituted of seven
members, all are appointed by the government. Besides, for emergency decisions,
there is an executive committee constituted of the chairman and two other board
members, the managing director and one of the directors elected by the board. The
managing director is the chief executive of the bank.

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2.5 Vision of Rajshahi Krishi Unnayan Bank
To turn the northwest area into a developed area through developing agriculture
sectors.
2.6 Mission of Rajshahi Krishi Unnayan Bank
 To turn the RAKUB into a profitable organization
 To turn the RAKUB into a self-reliant organization
2.7 Corporate Slogan of Rajshahi Krishi Unnayan Bank
“ সততা ও স্বচ্ছতার সাথে করব কাজ
রাকাব এর মাোয় পড়াব তাজ ”
2.8 Capital
Authorized capital of the bank as determined by the government amounts to Tk.
10000 million and paid up capital Tk. 7000 million.
2.9 Board of Directors
To steer the bank in accordance with the government policies there is a Board of
Directors comprised of the chairman and ten other directors as appointed by the
government. Besides, there is a three-member executive committee for deciding on
emergency policy matters.
2.10 Objectives of Rajshahi Krishi Unnayan Bank
Rajshahi Krishi Unnayan Bank has been rendering an important service in the
development of rural economy since its inception. The main objective of originating
RAKUB is to play a vital role to increase agriculture production, create income-
generating activities, development of socio-economic condition of the farmers of the
North-West areas of the country. Through achieving these objectives, it plays an
important role for economic growth of the country.
It gives loan to the basic sector, sub-sector and supplementary sector of the agriculture
such as crops production, animal husbandry, poultry, farming, fishery, livestock,
dairying, horticulture, forestry, purchasing machinery for irrigation and agriculture

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goods and inputs trade, storage of agriculture goods, establishment of processing and
marketing oriented industry, agro-based industry. Moreover, it also provides loan with
poverty alleviative activities in order to increase self-dependence of landless,
marginal and small farmer.
One of the main objectives of it is to operate banking functions such as receiving
deposit, fund transferring foreign exchange transaction, etc. The above objectives are
listed as following:
 To provide credit facilities for agricultural development of poor farmers.
 To provide credit facilities for the socio economic development of poor
farmers.
 To save money as deposit (Hajj Saving, Education Saving, Rural Pension
Saving and others) for future expenditure or needs.
 To provide credit facilities for increasing crops production.
 To provide credit facilities for poverty alleviation.
 To provide credit facilities for creating small firm as Livestock & Poultry,
Fishery, Hatchery.
 To encourage the small entrepreneurship via providing credit facilities.
 To provide credit facilities for creating self-independence.
 To increase income and remove poverty of the people of northwest area of
Bangladesh.
 To supply agricultural inputs and service to the entrepreneur.
 To develop and create employment opportunities.
 To provide credit facilities for developing humanity.
The objectives of RAKUB can be summarized as follows:
I. To provide credit facilities for all kinds of agricultural and agro-based
economic activities keeping view in the needs of small and marginal farmers.
II. To earn normal profit for meeting the operational expenses, building reserve
and expansion of activities to cover wider geographical areas. To extend
counseling and advisory service to the borrowers/entrepreneurs etc. in utilizing
credit facilities of the bank.

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2.11 Functions of Rajshahi Krishi Unnayan Bank
As the largest development partner in the northwest region Rajshahi Krishi Unnayan
Bank aims at overall development of the farmers and all the sectors and sub- sectors
of agriculture in the region. Besides catering to agricultural credit, financing agro-
business and agro- based industries and property alleviation programs the bank
performs ancillary banking functions. Catering to the credit needs of the agriculturists
of the Northwest zone of Bangladesh is the focal point of the activities of the Bank.
The economic condition of the farmers is totally dependent on the performance of
agriculture. So, agriculture and agriculturists are the focus of activities of the Bank. It
has given top priority to all the sub- sectors and associated sectors of agriculture for
achievement of desired business goal. The seven priority sub- sectors of lending are as
follows:
(i) Crop production
The Bank finances all the summer crops, winter crops agriculture & nursery etc.
High yielding and high value crops and seeds production is particularly
encouraged. Crop sub-sector alone occupies 60% of the lending budget of the
Bank.
(ii) Fishery
It is the second most priority sector identified by the bank. The bank attaches
importance to use scientific method and modern technology in fish cultivation; it
extends adequate credit support for excavation and re- excavation of species,
which have rapid growth, cultivation of sweet water prawn and other fishes. The
bank makes use of expertise of the concerned government agencies for bringing
more ponds/ water bodies under cultivation and increasing productivity. The Bank
has also identified financing of small fish hatcheries as potential of its loan
portfolio.

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(iii) Livestock
The bank extends credit facilities for systemic and commercial livestock farming
which includes dairy, beet, faltering, poultry raining and setting up of hatcheries
which in turn in expected to increase production of milk, meat and eggs, the main
sources of protein. As the marginal and small farmer’s access to mechanized
farming is restrained by want of cash and collateral, the bank has a big lending
window of draft animals for cultivation of loan transportation of agricultural
produces and other farming activates.
(iv) Irrigation Equipment and Farm machinery
In today’s technology based farming of high- yielding and high- value corps,
mechanization of cultivation, irrigation and pesticide control is indispensable.
To cope with the situation pesticide application devices, threshing machine and
other farm machineries are being treated as an important associated sector of
lending.
(v) Agro based Industries
The operational jurisdiction of the Bank is noted for its agriculture potentials. The
Bank pays due importance to setting up agro- industries for preservation,
processing and marketing of agricultural produces having backward linkage with
basic sub- sectors of crop, fishery, livestock and forestation. Manufacturing and
marketing of agricultural implements are also encouraged. Agro industries for
import substitution are specially encouraged by offering moderate terms of
financing.
(vi) Contentious Loan
The Bank grants cash credit/ working capital facilities for a maximum period of
12 months for procurement of raw materials for industrial units, trading &
marketing of agricultural outputs & inputs and commercial farming.

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(vii) Poverty Alleviation
The poverty- striker northwest Bangladesh is characterized by comparatively
lower rate of saving, inadequate accumulation and slim employment
opportunities.
The existing collateral – based banking system is also of little use in respect of
extending support to millions of land less people. To address the problem, the
bank has been financing collateral – free micro credit for income and employment
generation through its poverty alleviation credit programs.
2.12 Organogram of Rajshahi Krishi Unnayan Bank (RAKUB)
The head office is stationed at divisional headquarters city of Rajshahi. The branches
network of the bank comprises 379 branches including one in Dhaka. Eighteen zonal
offices stationed in district headquarters control branches under them. The General
Manager's office at Rangpur oversees activities of 9 zones of greater Rangpur,
Dinajpur districts. There are 18 independent regional audit offices for conducting
regular audit in branches and zonal offices. The training institute of the bank is
situated at Rajshahi. There are 3,667 employees (as on 14-08-2016) of the bank of
which 2,290 are officers and 1,377 other staff.
Total branches 379
Zonal Office 9
Regional Office 18
Total Employees 3,667

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ORGANIZATION STRUCTURE
Board of Director
Managing Director
Secretariat
Public Relation Secretariat of M.D.
General Manager
Adm.& A/C.
General Manager
Operating
General Manager
Audit& Recovery
General Service Dept. Resource &
evelopment Dept
Loan Recovery Dept-1.
Central Account
Dept-1
Budget& Cost Control
Dept.
Loan Recovery
Dep-2.
Central Account
Dept-2
Branch control
Dept.
Loan Recovery
Dept-2
Personnel
Management Dept.
Loan & Advance
Dept-2
Regional Audit
office- 18
Training institute Loan & Advance
Dept-1
LPO Dhaka
Branch
Zonal
Office
Rajshahi
Regional
Office
Naugoan
Regional
Office
Nawabgong
Regional
Office
Natore
Zonal
Office
Pabna
Regional
Office
Sirajganj
Regional
Office
Rangpur
Regional
Office
Thakurgoan
Regional
Office
Phanchogor
Regional
Office
Dinajpur
Zonal
Office
Dinajpur
Regional
Office
Lalmonirhat
Regional
Office
Nilfamary
Regional
Office
Kurigram
Regional
Office
Gaibanda
Regional
Office
Natore
Zonal
Office
Pabna
Regional
Office
SirajganjBranch
15
Branch
17
Branch
16
Branch
17
Branch
18
Branch
17
Branch
18
Branch
22
Branch
13
Branch
17
Branch
19
Branch
19
Branch
21
Branch
13
Branch
16
Branch
14
Branch
15
Branch
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Figure-1: Organogram of Rajshahi Krishi Unnayan Bank
Source: Rajshahi Krishi Unnayan Bank (RAKUB) website

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2.13 Management Hierarchy of Rajshahi Krishi Unnayan Bank
(RAKUB).
Figure-2: Management Hierarchy
Chairman
Board of Directors (BOD)
Managing Directors (MD)
Deputy Managing Directors (DMD)
General Manager (GM)
Deputy General Manager (DGM)
Assistant General Manager (AGM)
Senior Principal Officer (SEO)
Principal Officer (PO)
Senior Officer
Officer
Computer Operator/Supervisor
Data entry Operator
Guard/Peon
Source: Rajshahi Krishi Unnayan Bank’s Website

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Principal Officer
Second Officer (Senior Officer)
Officer
Computer Operator
2.14 Organizational Structure of Saddapushkaruni Branch, Rangpur
Source: Employee Register Book of Saddapushkaruni Branch
2.15 Organizational Setup
The affairs of business of the bank are managed through three functional tiers
A. Head Office:
The head office of RAKUB is stationed at 280 km far from capital city Dhaka, at
North-west divisional city Rajshahi. All operation is control by head office. The
managing Director is assisted by the three following functional divisions. Each
headed by a General Manager:
i. Administration and Accounts Division.
ii. Operation Division.
iii. Audit and Recovery Division
The three divisions further divided into 12 departments are as follows:
i. Administration and Accounts Department:
1) Personnel Department
2) Common Services Department
3) Central Accounts Department-I
Security guard

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4) Central Accounts Department-II
ii. Operation Division:
1) Branches control Department
2) Loans and Advances Department-I
3) Loans and Advances Department-II
4) Research and Development Department.
5) Budget and Expenditure Control Department.
iii. Audit and Recovery Division:
1) Loan Recovery Department-I
2) Loan Recovery Department-II
3) Audit and Inspection Department
B. Supervision and control:
The zonal offices are headed by Deputy General Managers while Regional Offices by
Assistant General Managers.
C. Vigilance:
The functions of the Audit offices are to keep the branches regular. The Audit offices
accomplish auditing of the branches on half-yearly basis Regional Audit offices are
directly controlled by the audit and Inspection Department of the head office and by
no way influenced by the local Regional on zonal offices.
D. Training Institute:
The only training Institute at Rajshahi imparts training to the junior and mid-level
officers and other staff according to the annual training program designed on such
subjects of professional interest as management of credit and accounts. Commercial
banking, audit and inspection etc.
2.16 Role of RAKUB in the Development of North West Region
Rajshahi Krishi Unnayan Bank (RAKUB) has been playing a vital role for the
development of the agriculture in North-West region. Although RAKUB is
specialized for agricultural loan but the general commercial activities of this bank is
very much wide.

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The main role of RAKUB is to develop the agro-based industries, self-employment,
solving the unemployment problem and supply of money for the expansion of social-
economic activities. Its responsibilities have been increased after the construction of
“Bangabandhu Bridge” over Jamuna River, which connected North-West region with
the eastern region of the country. On account of economic development of the farmers
of the North-West region of the country RAKUB is continuing its restless efforts with
more than 101 loan programs.
2.17 Main Activities of Rajshahi Krishi Unnayan Bank
The main activities of Rajshahi Krishi Unnayan Bank are:
 Disbursement of loans
 Recovery of loans
 Deposit mobilization
2.18 Money Transfer Facility of Rajshahi Krishi Unnayan Bank
Money Transfer through DD, TT & MT among RAKUB's branches. Moreover, in
land and from abroad money transfer is performing by contracted agency.
2.19 Other Services of Rajshahi Krishi Unnayan Bank
Source: Income tax, Excise, VAT etc collecting and depositing to Govt. Treasury
 Saving Letter & Prize Bond buying and selling
 Semi-Scholarship, Old-widow subsidiary,
Teachers/employees salary
 Collecting Polly Electric bill, NGO-Telephone bill,
Private insurance company premier,
 Land Revenue collecting,
 Collecting Hazz money of Govt. management pilgrim

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2.20 Rate of application form and other papers
Table-1: Rate of application form and other papers
Complain: Services related any complains to honorable customers can drop complain
to box that kept in Branch. Customers can contact to Branch Manager for any consult
if necessary.
2.21 Credit Programs of Rajshahi Krishi Unnayan Bank
Rajshahi Krishi Unnayan Bank caters to financing of all the agricultural activities
including:
Crop production,
Fishery,
Animal Resource,
Irrigation equipment & farm machinery,
Crop processing and marketing,
Agro-industries and Agri-business.
The bank pays importance to financing poverty alleviation and employment
generation activities, SME and other off-farm activities. The bank disburses 60
percent of its annual target for crop production. The bank’s outstanding loan amounts
to Tk. 4,413.84 core and number of borrowers are 8, 59,418 (14-08-2016)
Sl.
No
Description Rate/Fee
01 Loan Application Form Free
02 Mortgage Deed Form Free
03 Loan Fee, Appraisal Fee And
Search Fee
Free
04 Loan Process Fee ( Other than
Crops)
0.50% of Applied Amount (Highest Tk
2.00 Lac)
05 Loan Evaluation Fee ( Crops) 0.50% of Applied Amount
06 Mortgage Deed Process fee 0.50% of Sanctioned Amount (Highest
Tk 1.00 Lac)

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2.22 Foreign Aided Credit Projects
North-west Crop Diversification Project (NCDP)
The ADB financed project finances for high-value crop production. Four NGOs
namely BRAC, Proshika, RDRS and GKF draws loan from RAKUB and relends
among farmers.
2.23 Small Enterprise Credit Program (SECP)
The project is jointly funded by the Royal Norwegian government and RAKUB. It
aims at promotion of entrepreneurship in agro-based small enterprises and non-farm
activities. The main objective of the project is to create employment through
development of small enterprises. It gives priority to financing the women
entrepreneurs. Maximum credit limit for a single enterprise is Taka 0.50 million. The
project provides training to the entrepreneurs. A process is undergoing for converting
the project into a subsidiary company of RAKUB.
2.24 Others Special Credit Programs
 Special Credit Program for Freedom Fighters,
 RAKUB Special Credit Program for Small Ethnic Communities,
 Special Credit Program for Government Primary School Teachers,
 Credit Program for Overseas Employment,
 Collateral-free Group-based Credit Program for the Landless and
Sharecroppers,
 Credit Program for Production of Pulses, Oilseeds, Spices and Maize at 4%
promotional rate of interest and
 Green banking programs like biogas and solar plants.
2.25 Use of Information Technology (IT) of RAKUB
To cope with the advancement RAKUB has intensified IT activities. Presently the
bank pursues off-line banking. Total 213 branches of the bank have already been
computerized (Off-line). Besides, the bank has been implementing a plan of
computerizing all of its branches by December 2015. A plan is underway to introduce
Core Banking Solution (CBS) in 25 branches of the bank in financial year 2015-
2016.According to this plan all branches will be under CBS by the fiscal year 2017-
2018.

21
2.26 Rajshahi Krishi Unnayan Bank (RAKUB) at a Glance (As on
13 August 2016)
Table-2: RAKUB at a Glance
2.27 Profile of the Saddapushkaruni Branch, Rangpur
2.27.1 Establishment and Location of Saddapushkaruni Branch, Rangpur
Rajshahi Krishi Unnayan Bank (RAKUB), Saddapushkaruni Branch is stationed at
Palichara hat, Saddapushkaruni Union, Rangpur Sadar, Rangpur. It was established in
15March 1987. This branch started its operations in its own building in 1st
August
2005, before that it worked at a building of union parishad. It is one of the busy
branch of Rangpur. It covers one union and about 13 villages of Rangpur Sadar thana.
2.27.2 Saddapushkaruni Branch at a Glance (Table- 3)
Establishment : 15 March 1987
Authorized Capital : Tk. 10000 million
Paid up Capital : Tk. 5700 million
Region : Rajshahi & Rangpur Divisions
Area : 34,513 Square KM
District : 16
Upazila (administrative tier in between
district & union)
: 125
Municipality : 64
Union (lowest administrative tier) : 1,092
1 Establishment 1987
2 Area About 37.67 km
3 Location Palichara hat, Saddapushkarini Union,
Rangpur Sadar, Rangpur
4 No. of loan receiver 1641
5 No. of depositor 8774
6 No. of employee 9
7 No. of village 13
8 Total Population About 45000

22
Principal Officer
Second Officer (Senior Officer)
Officer
Computer Operator
2.27.3 Organizational Structure of Saddapushkaruni Branch, Rangpur
Figure-3: Organizational Structure of Saddapushkaruni Branch
Source: Employee Register Book of Saddapushkaruni Branch
2.27.4 Employee Summary
Table-4: Employee summery of Saddapushkaruni Branch
Source: Official record of RAKUB, Saddapushkaruni Branch,
SLNo Designation Authorized Existing Vacant
1 Principal Officer 1 1 0
2 Second Officer ( Senior Officer) 2 1 1
3 Officer 4 2 2
4 Computer Operator 1 1 0
5 Security Guard 2 1 1
6 Total 10 6 4
Security guard

23
2.27.5 Functions of Saddapushkaruni Branch, Rangpur
Like other banks Saddapushkaruni Branch does the following activities:
a. Receive deposits from customers.
b. Payment to customers according to payment order given through check
by customers.
c. Disbursements of loan and recovery of the given loan.
d. Giving advice to the clients of the bank.
e. Transfer money from one place to another place.
2.27.6 Corporate Social Resposibility of Saddapushkaruni Branch, Rangpur
Corporate Social Responsibility (CSR) is comparatively a new concept in the banking
domain of Bangladesh. It was in June 2008 Department of Off-site Supervision of
Bangladesh Bank in DOS Circular No. 01 Date: 1 June 2008. Regarding
Mainstreaming Corporate Social Responsibility (CSR) in banks and financial
institutions in Bangladesh stipulated the need of CSR.
Globally, the idea of Corporate Social Responsibility (CSR) is fast gaining acceptance
as the contribution that businesses can and should make voluntarily towards
environmentally sustainable and socially equitable development. Stated briefly, CSR
is about
(i) Taking stock of the economic, social and environmental impacts of a
business,
(ii) Mitigating the negative impacts and bolstering the benign impacts,
(iii) Taking up action programs and community investments to reduce social
exclusion and inequality and to address the key sustainable development
challenges.
CSR programs and actions go beyond such mandatory compliances as mandated by
laws and regulations into voluntary engagements to promote equitable, sustainable
development. Besides the self-evident ethical case, a strong business case for CSR (as
investment in a strategic asset or distinctive capability, rather than an expense) is also
getting clearer with developing practice; seen as benefiting a business by:

24
 Building reputation, brand value, customer loyalty, employee motivation and
retention;
 Mitigating risks in own operations and in assessing suppliers and clients;
 Cutting down wastes (of energy, raw materials etc.), driving up efficiency;
 Gaining new markets for products and services, in the communities/social
groups benefited by the CSR actions.
2.27.7 General Activities of Saddapushkaruni Branch, Rangpur
Different deposit related services provided by the bank are mentioned below:
A) Deposit Services:
1) Current Deposit Account
2) Savings Deposit Account
3) Term Deposit Account
a) Short Term Deposit Account (STD)
b) Deposit Pension Scheme (DPS)
c) RAKUB Deposit Pension Scheme (RDPS)
d) Fixed Deposit Account
B) Commercial Services:
a) Demand Draft (DD)
b) Mail Transfer (MT)
c) Telephone/ Telegraphic Transfer (TT)
d) Payment Order (PO)
C) Loan and Advance Services:
a) Short Term Loan
b) Medium Term Loan
c) Long Term Loan
The above services of RAKUB’s Saddapushkaruni branches are discussed in
following pages respectively:
A. Deposit Services:
The following 3 types of accounts are available at Saddapushkaruni Branch:

25
1. Current Account:
From this type of account any amount of money is deposited and drawn at any time in
the office hours. There is no interest on current account. Bank over draft is sanctioned
based on it. This account is opened with minimum deposit of Tk.1000.
2. Savings Account:
Savings account opened for the individual customers except companies, firm and Co-
operative society. Money is withdrawn two times a week and deposited at any time in
the office hours. If an account holder draws money from account he/she will not get
interest for that month. To open an account bank requires Tk.200 only.
3. Term deposits:
a. Short Term Deposit Account (STD):
Short Term Deposit Accounts are opened for company, business firms and
government demonstrative body. This account is operated like current
account.
b. Deposit Pension Scheme (DPS):
It is one kind of deposit program circulated by government. In this savings
scheme a person receives the opportunity to build up saving by contributing
monthly installment to get an attractive fixed amount at the end of a specific
period. The size of monthly installments is Tk. 100, Tk. 200, Tk. 300, Tk. 400,
Tk. 500, or which is to be deposited within the first week of each month. In
this case compound rate of interest is charged.
c. RAKUB Pension Scheme (RPS):
RAKUB has some savings schemes to motivate the people for savings. In this
case RPS is regarded as the special product of this bank. The RPS is same as
DPS. But terms of savings of RPS are 5 years and 10 years.
d. RAKUB Grameen Pension Scheme (RGPS):
It is for the grameen poor people to motivate them increase in savings. It is
same as DPS & RPS.

26
e. Fixed Deposit Account (FD):
Fixed deposits are taken for the following terms:
From one month to below three months
From three months to below six months
From six months to below one year
From one year to below two years
From two years and above(maximum 3 years)
2.27.8 Interest Rate of Deposits and Schemes of RAKUB
Types of Deposit Account Interest Rate
Current Deposit Account 8774
Savings Bank Account (Urban Area) 5.00%
Savings Bank Account (Rural Area) 6.00%
Deposit from Non Residence (Urban) 6.00%
School Banking 7.00%
Special Notice
Deposit (SND)
Account
Below 1.00 core 4.25%
Above 1.00 core to below 25.00 core 4.25%
Above 25.00 to below 50.00 core 4.25%
Above 50.00 to below 100.00 core 4.25%
Above 100.00 core 4.25%
Fixed Deposit
Receipt (FDR)
(w.e.f. 01-06-2016)
from 1 month to below
3 months
6.00%
from 3 months to below
6 months
7.50%

27
from 6 months to below
1 year
7.50%
from 1 year to below 2
years
7.50%
From 2 years & above
(maximum 3 years)
7.50%
Special Savings
Scheme
Duration Interest Rate
RAKUB Monthly Profit
Scheme (RMPS)
5 years 10.80%
RAKUB Millionaire
Deposit Scheme
(RMDS)
5, 7, 10 years 9.75% (compound)
RAKUB Savings
Scheme (RSS)
7 years 9.00% (compound)
Krishok Sanchay
Scheme (KSS)
Teachers' Savings
Scheme
Micro Savings Scheme 5 years 8.50% (compound)
RAKUB Daily Profit
(RDP)
daily minium
balance
20,000TK
5.00% (daily
product basis on
balance)
RAKUB Grameen
Pension Scheme
(RGPS)
5, 10 years 9.00% (compound)
RAKUB Education 5,10 years 9.00% (compound)

28
Savings Scheme
RAKUB Santan/Santoti
Bibaha Sanchay
Prokalpo
5, 10, 15 years 9.00% (compound)
RAKUB Hajj Savings
Scheme
1-10 years -
RAKUB Monthly
Savings Scheme
(RMSS)
3, 5, 8 years 8.75%-9.50%
(compound)
RAKUB Grehini
Savings Scheme
(RGSS)
N.B. Interest rate on 10-taka Farmers' accounts will be 1.00% above the existing rate
of interest on savings accounts.
Table-5: Interest Rate of Deposits and Shemes
Source: Manager, Saddapushkaruni Branch
2.27.9 Commercial Functions of Saddapushkaruni Branch
The following types of commercial service are available in RAKUB’s
Saddapushkaruni Branch.
a. Demand Draft (DD)
DD is the most popular instrument of remitting fund. It is an order to pay money
drawn by one branch Payable to another branch on demand. DD is issued in against at
Tk.20 commission up to Tk.1000. When the limit exceed commission amount
increased in a certain rate.
b. Mail Transfer (MT)
This branch transfer money another branch of this bank in another place in against of
commission money of this security paper has to be transferred to an account of

29
another branch. Here the bank commission is minimum Tk.30 and the postal charge is
Tk.50.
c. Telegraphic Transfer (TT)
It is the quickest method of remitting fund from one place to another. In this
procedure no instrument is sent to the paying branch. Only message is sent over
telephone or telex and the paying branch makes payment after getting message. Due
to lack of technology this branch cannot operate TT.
d. Payment Order (PO)
It is a written document. This PO can be encased on that branch from where it is
issued. Several supplier organizations use this PO and here no account is needed to
open with bank. It is issued locally.
Table-6: Commission charged on commercial service
Service Charge Tk.
Demand Draft Tk.20+VAT
Telegraphic Transfer Tk.30+VAT
Payment Order
Up to Tk.1000 Tk.20+VAT
Up to Tk.1,00,000 Tk.30+VAT
Over Tk.1,00,000 Tk.50+VAT
Up to Tk.5,00,000and over Tk.100+VAT
Mail Transfer Minimum Tk.30+ Postal
cost(Tk.50)+VAT
Cancellation Charge of DD, MT, TT, PO
Up to Tk.500 Tk.25+VAT
Over Tk.500 Tk.50+VAT

30
2.27.10Loan services Saddapushkaruni Branch, Rangpur
Banks loan portfolio has been classified under the following heads:
 Short Term Loan (STL): Loan period is 1 year.
 Medium Term Loan (MTL): Loan period is above 1 year to 5 years.
 Long Term Loan (LTL): Loan period is more than 5 years.
2.27.11Procedure to Open an Account at Saddapushkaruni Branch, Rangpur
RAKUB provides opportunity for opening an account to customers like other banks.
To open a Current Deposit A/C, Savings Deposit A/C an individual has to carry out
the following procedure given below;
I. Obtain a prescribed application form from the bank.
II. Submit the duly completed form with necessary papers to the concerned
officer.
III. Face a brief interview
IV. Put specimen signature in the signature card supplied by the bank
V. Deposit of money
VI. Get counter folio of the payment slip.
With the prescribed application form, the applicant should submit the following
papers and information.
a. Nationality certificate from the appropriate authority.
b. Two copies of recent passport size photograph.
c. If the applicant is a service holder he should collect employee certificate
from his employer and is to be submitted.
d. The applicant’s signature should be identified by an introducer who has a
Current Deposit A/C with the respective branch.
e. The applicant should deposit minimum taka 200/- to open an account.
Things considered to open an account are:
 Proper fill up of the application form.
 Getting an specimen signature of a customer
 Taking initial deposit in cash.

31
Basically a person whose age is 18 years or more is competent to open an account
with the bank. But there are some special types of account holder like joint account,
minor account, illiterate person account, blind person account, Deaf and dumb
account etc. The following parties can never open an account with the bank-
 Person who is still bankrupt.
 Person whose mind is unsound.
 Person who is totally mad and lunatic.
2.27.12 Procedure to Close an Account Saddapushkaruni Branch, Rangpur
In order to close an account (some time before maturity in case of FDR) the holder
has to place a written application to the bank. After receiving the application the bank
will deduct service charge at an amount necessary for the respective account as
closing fee from the balance and rest of the money is given to the account holder.
When Bank Close an Account
The relationship between bank and his customer is a contractual one and may be
terminated by either of them. Bank closes an account in the following situations;
1. If a customer places written application to the bank to close his account.
2. If the customer does not properly follow the rules and regulations necessary to
operate his account.
3. If the bank is notified the message of death of a customer.
4. If the bank receives a notice regarding the insanity of his customer.
5. If the bank receives any order from court regarding the closing of the customer’s
account
2.27.13 Sectors in which Saddapushkaruni Branch Extents credit
Rajshahi Krishi Unnyan BankSaddapushkaruni Branch extends credit in sectors and
sub sectors, which are as follows:

32
SL
No
.
Name of the Project Description of project item
1 Crops Loan project Mango,Jute,Cotton,Paddy,Wheat, Potato,
Sugarcane,etc.
2 Fishery Loan Project Commercial Fishing Hatchary,
3 Livestock Dairy live stock and Agriculture based poultry dairy .
4 Micro-Credit RSCP, SECP.
5 Firm Machineries Engineering work shop for Agro-equipment,
Repairing agro equipment and Marketing.
6 Continuous Loan Fish freezing plant, Fish dehydration plant, Leather
processing and manufacturing Leather products.
7 Others Loan Poultry and Fish feed meal production, Cattle, Goat,
and Lamb feed meal production.
2.27.14 Interest Rate on Different Types of Loan
Bank determines the interest rate differently for different sector. Considering interest
rate on deposit, administrative cost, bank rate, interest rate at others bank and
financial institutions, competitive money market etc, the banks use its rate of interest
on loan.
Table-7: Rate of interest in different sectors
Sl
No.
Credit Sector Rate of Interest Maximum Duration
of Disbursement
01 Crops 11% One Week
02 Fisheries 11% Four Week
03 Animal Resource 11% Four Week
04 Irrigation & Agriculture
Machinery
11% Four Week
05 Agro-based Industry 14% Four Week
06 Cash Credit /Working 15% Four Week

33
Source: Official record of RAKUB, Saddapushkaruni Branch
2.27.15 Books Maintained by Saddapushkaruni Branch, Rangpur
The main objectives of maintaining the books of RAKUB, Saddapushkaruni
Branch are to achieve the following goals.
Capital
07 Socio-Economic Activities 8-11% Four Week
08 Others (Against Deposit
Scheme)
3% more than
given rate
Date of Apply
1. To record day-to-day transaction
2. To reflect the financial position periodically
3. To supply necessary information for monitoring the bank activities
In that purposes cash transaction and other transaction is recorded in the books of
accounts under the double entry system. In this bank, generally two types of books are
used.
A. Control Books:
It represents the immediate accounting picture of the bank at any time and it includes-
a) Cash Scroll Book
b) Clean Cash Book
c) General Ledger Abstract
d) Supplementary ledger Book
B. Subsidiary Books:
Subsidiary Books are used to explain the total particulars in General ledger and it
includes-
a) Saving account ledger
b) Fixed deposit ledger
c) Income ledger
d) Expenses ledger
e) The general ledger of RAKUB,

34
2.27.16Accounting procedure of Saddapushkaruni Branch, Rangpur
The procedure followed in Saddapushkaruni Branch is presented through diagram at
next page:
Figure-4: Accounting procedure
Transaction
Cash
Cash cum day book preparation
TransferClearing
Voucher
Record in Register
Posting in ledger
Supplementary sheet preparation
Summary preparation
Affairs frond page
General ledger posting
Affairs back page
Subsidiary ledger posting

35
2.27.17 Income and expenses accounts for Saddapushkaruni Branch, Rangpur
Name of Accounts Total Figure in Taka as on(30/06/2012)
Interest on Loan 7815093
Fees and Other Charges 184774
Sale Proceed of Forms 10625
(a) Sub-Total 8010492
Commission and Exchange 17517
(b) Sub-Total 17517
Interest on Loan to Employees 270631
Sundry Income 245355
Income from Recovery of Loan Write off 56446
(c) Sub-Total 572432
Total Income (a+b+c)= 8600441
Expenses Accounts:
Name Of Sub-Account Figure in(Tk.)
Salaries of Honorarium 659595
Salaries and Wages of Staff 108856
House rent Allowances 319634
Overtime Allowances 7077
Other Allowances 211940
Staff Welfare &Recreation Expenses 270200
Employees Travelling Expenses 105324
Liveries for Class Iv Employees
Medical Services 44325
Employees Travelling Expenses
Super Animation 384226
Bonus to Staff 132555
(a) Sub total 2243732
Electricity & Water Charges 8511
Rentals 59670
Repairs & Renovations

36
Rates & Taxes
Stationeries & Supplies 31188.97
Postage & Telegram (-)1438
Telephone
Conveyance Charge 6000
Insurance 0
Expenses of Motor Car & other Vehicles 0
Do(Repairs & Maintenance) 0
Advertising Publicity 0
Depreciations 52268
Business Development 5650
Books Purchase for Library
Sundry Expenses 49169
(b)Sub Total 211018.97
Interest on Deposits 2641275
Interest on Fund Borrowed 2786459
Commission, Exchange & other charges
(c)Sub Total 5427734
Total Expenditure (a+b+c)= 7882484.97
Total Operational Profit/( loss) 717956.03
Table-8: Income and expenses accounts.
Source: Saddapushkaruni Branch (Statement affairs) RAKUB.

37
In this chapter, we reviewed relevant literature connected to the study. This will
involve bringing up the theories that we were using our study. Here we have
discussed issues on customers’ perception and of satisfaction service quality and
defined relevant concepts in order to enhance my understanding of the study. In
context, this theoretical framework will enable us build a conceptual model that will
be the road map for our empirical observation.
Our study is mainly focused on customers’ perception and of satisfaction service
quality. Our research questions were how customers perceive service quality and what
the perception about service quality is, that they are agreed or disagreed and also
satisfied or dissatisfied with.
We therefore discuss relevant concepts such as customer perception, customer
satisfaction, customer services, quality, relationship between customer satisfaction
and banking business, importance of customer service management.

38
CREDIT RISK GRADING SCORE SHEET
Reference No: Date:
Borrower:
Aggregate Score: _________
Risk Grading: _________
Group Name (if
any):
Branch:
Industry/Sector:
Date of Financials:
Completed by:
Approved by:
Number Grading Short Score
1 Superior SUP Fully cash secured,
secured by
Government/International
Bank
Guarantee
2 Good GD 85+
3 Acceptable ACCPT 75-84
4 Marginal/Watchlist MG/WL 65-74
5 Special Mention SM 55-64
6 Substandard SS 45-54
7 Doubtful DF 35-44
8 Bad & Loss BL <35

39
Criteria Weight
Parameter
Score
Actual
Parameter
Score
Obtained
A. Financial Risk 50%
1. Leverage: (15%)
Debt Equity Ratio (×) -
Times
Total Liabilities to Tangible
Net worth
All calculations should be
based on annual financial
statements of the borrower
(audited preferred).
Less than 0.25×
0.26× to 0.35 x
0.36× to 0.50 x
0.51× to 0.75 x
0.76× to 1.25 x
1.26× to 2.00 x
2.01× to 2.50 x
2.51× to 2.75 x
More than 2.75×
15
14
13
12
11
10
8
7
0
2. Liquidity: (15%)
Current Ratio (×) - Times
Current Assets to Current
Liabilities
Greater than 2.74×
2.50× to 2.74 x
2.00× to 2.49 x
1.50× to 1.99 x
1.10× to 1.49 x
0.90× to 1.09 x
0.80× to 0.89 x
0.70× to 0.79 x
Less than 0.70×
15
14
13
12
11
10
8
7
0
3. Profitability: (15%)
Operating Profit Margin
(%)
Operating Profit
×100
Sales
Greater than 25%
20% to 24%
15% to 19%
10% to 14%
7% to 9%
4% to 6%
1% to 3%
Less than 1%
15
14
13
12
10
9
7
0
4. Coverage: (5%)
Interest Coverage Ratio
(×)-Times
Earnings Before Interest &
Tax (EBIT) Interest
on debt
More than 2.00×
More than 1.51×
Less than 2.00×
More than 1.25×
Less than 1.50×
More than 1.00×
Less than 1.24×
Less than 1.00×
5
4
3
2
0
Total Score–Financial Risk 50

40
Criteria Weight
Parameter
Score
Actual
Parameter
Score
Obtained
B. Business/Industry
Risk 18%
1. Size of Business (Sales in BDT
crore)
The size of the borrower’s
business measured by the most
recent year’s total sales.
Preferably based on audited
financial statements
> 60.00
30.00 – 59.99
10.00 – 29.99
5.00 - 9.99
2.50 - 4.99
< 2.50
5
4
3
2
1
0
2. Age of Business
The number of years the borrower
has been engaged in the primary
line of business.
> 10 years
> 5 - 10 years
2 - 5 years
< 2 years
3
2
1
0
3. Business Outlook
A critical assessment of the
medium term prospects of the
borrower, taking into account the
industry, market share and
economic factors.
Favorable
Stable
Slightly
Uncertain
Cause for
Concern
3
2
1
0
4. Industry Growth Strong (10%+)
Good (>5% -
10%)
Moderate (1% -
5%)
No Growth
(<1%)
3
2
1
0
5. Market Competition Dominant
Player
Moderately
Competitive
Highly
Competitive
2
1
0
6. Entry/Exit Barriers Difficult
Average
Easy
2
1
0
Total Score-Business/Industry
Risk
18

41
Criteria Weight
Parameter
Score Actual
Paramete
r
Score
Obtained
C. Management Risk 12%
1. Experience
(Management & Management
Team)
The quality of management
based on the aggregate number
of years that the Senior
Management Team has been in
the industry.
More than 10 years
in the related line
of business
5–10 years in the
related line of
business
1–5 years in the
related line of
business
No experience
5
3
2
0
2. Second Line/ Succession Ready Succession
Succession within
1-2 years
Succession within
2-3 years
Succession in
question
4
3
2
0
3. Team Work Very Good
Moderate
Poor
Regular Conflict
3
2
1
0
Total Score-Management Risk 12

42
Criteria Weight
Parameter
Score
Actual
Parameter
Score
ObtainedD. Security Risk 10%
1. Security Coverage
(Primary)
Fully pledged
facilities/substantially
cash covered/Reg. Mortg,
for HBL
Registered Hypothecation
(1st
charge/1st
Pari passu
charge)
2nd
Charge/Inferior charge
Simple hypothecation/
negative lien on assets.
No security
4
3
2
1
0
2. Collateral Coverage
(Property Location)
Registered Mortgage on
Municipal
Corporation/Prime area
property.
Registered Mortgage on
Pourashava/semi-urban
area property
Equitable Mortgage or No
property but plant &
machinery as collateral
Negative lien on
collateral
No collateral
4
3
2
1
0
3. Support (Guarantee) Personal guarantee with
high net worth or
Strong Corporate
Guarantee
Personal Guarantees or
Corporate Guarantee
with average financial
strength
No Support/Guarantee
2
1
0
Total Score- Security
Risk
10

43
Criteria Weight
Parameter Score
Actual
Parameter
Score
ObtainedE. Relationship
Risk
10%
1. Account Conduct More than 3 (three) years
accounts with faultless
record
Less than 3 (three) years
accounts with faultless
record
Accounts having
satisfactory dealings
with some late payments
Frequent Past dues &
Irregular dealings in
account
5
4
2
0
2. Utilization of Limit
(actual/projection)
More than 60%
40% - 60%
Less than 40%
2
1
0
3. Compliance of
Covenants / Conditions
Full Compliance
Some Non-Compliance
No Compliance
2
1
0
4. Personal Deposits
The extent to which the
bank maintains a personal
banking relationship with
the key business
sponsors/principals.
Personal accounts of the
key business Sponsors/
Principals are
maintained in the bank,
with significant deposits
No depository relationship
1
0
Total Score-Relationship
Risk
10
Grand Total- All Risk 100

44
3.1 Customer Concept
A customer (sometimes known as a client, buyer, or purchaser) is the recipient of a
good, service, product, or idea, obtained from a seller, vendor, or supplier for a
monetary or other valuable consideration.
“An individual or business that purchases the goods or services produced by a
business. The customer is the end goal of businesses, since it is the customer who
pays for supply and creates demand. Businesses will often compete through
advertisements or sales in order to attract a larger customer base”.
3.2 Who is the Customer?
One who uses the product or service,the one who purchases the product orservice or
the one who influences the product or service.
The customer is the end user or the person who consumes the product or gets benefit
from the service.
3.3 Types of Customer
There are lots of classification methods to differentiate types of customers. For
instance, the two principal categories are divided as external customers and internal
customers.
(A) Internal customer: An internal customer is a customer who exist an inside the
organization and purchase the product or service.
 Exchange a product or service
 Provides a product or service
 Customer inside the company
 Every person in the process
 Each dept. is customer of another
 An internal customer is just as important.Every function,whether it be
engineering, orderprocessing, production has an internal customer.
(B)External Customer: External customers refer to the customers, who are paying
for the final products or services.

45
External customer is an exist outside the organizations and generally falls into three
categories.
1. New customers: Persons have never experienced the products or services of the
company before and they begin to try the products or services and may gradually
become current customers or lost customers of business organizations.
2. Current customers: Persons who are being in the process of a purchasing. They
have a certain degree of understanding and knowledge of the company.
3. Lost customers: Persons who used to be the customers of the firm but somehow
change to other firm.
3.4 Customer affecting factors
There are some factors which affect customer´s perception of the value of being a
customer the company. A customer figures out a company by noting the way how it
• Fixes products ´price
• Handles invoicing
• Takes care of quality problems
• Mistakes and service failures
• Manages complaints
• Offers customer training on how to use machines, equipment and software
• Handles queries and answers questions and e-mails
• Pay attention to customers and their special requests and wishes
• Keeps promises and delivers promptly, etc.
3.5 Why customers quit a company?
Enterprise has been experienced that there are six primary reasons for what customers
stop their business:
1% dies
3% move away
5% develop other relationships
9% leave for competitive reasons
14% are dissatisfied with the product
68% percent go to somewhere because of the bad treating by the employees

46
3.6 Perception Concept
The word “Perception” derived from the Latin word “percipio” which means the
ability to see, hear, or become aware of something through the senses. Perception is
awareness, comprehension or an understanding of something. Perception depends on
complex functions of the nervous system, but subjectively seems mostly effortless
because this processing happens outside conscious awareness.
An example of perception knows when to try a different technique with a student to
increase their learning
3.7 Customer perception concept
Customer perception is a marketing concept that encompasses a customer's
impression, awareness and/or consciousness about a company or its offerings.
Customer perception is typically affected by advertising, reviews, public relations,
social media, personal experiences and other channels.
3.8 Customer satisfaction concept
Customer satisfaction is the individual perception of the performance of the product
or service in relation to his/her expectations.
Customer Satisfaction = Expected Performance – Perceived Performance
When Customers are Satisfied or Dissatisfied?
3.9 Quality concept
Quality is product performance, which results in customer satisfaction freedom from
product deficiency which avoids customer dissatisfaction. Quality is the degree or
grade of excellence or possessed by a product.
Quality conveys that there is something good or worthyness. So, quality means
conformance to requirement.
Quality(Q) =P/E Where,
=15 hrs/20 hrs P=Performance
=0.75 hrs E=Expectation
Finally, quality means performance by expectation.

47
3.10 What is the dimension of quality?
Quality has nine dimensions. Each of these dimension is discussed here is brief.
1 .Performance: Performance means the primary character of the product. Example-
The brightness of the picture.
2. Features: Features means the secondary character of the product Example: Internet
browser, listening song, remote control etc.
3. Conformance: The degree to which aproduct design of the operating character of
specific standard.
4. Durability: How much time the product is exists. The product life also
considerable. Useful life include repair. Example; I phone
5. Reliability: Consistency of performance overtime average time for the unit to fail.
6 .Service ability: The resolution of problem of easy repair product. such as washing
machine.
7. Response: Response means that human to human interface relation with which
deal with producer to customer. This means courtesy of the dealer.
8.Aesthetics: Aesthetics means how a product feels, look, smell etc. How a product
smell feels.
9. Reputation: Reputation as the synonym of word goodwill. Reputation means that
past performance. Other belief that rank fast.
So, above are the major dimensions of quality.

48
3.11 Service concept
A service is an act of performance that one party can offer to another that is
essentially intangible and does not result in the ownership of anything. Its production
may be tied to a physical product. Examples are banking, hotel, airline, retail, wireless
and home services.
3.12 Characteristics of Service
There have some characteristics which are given below.
1. Intangibility: Buyer it do not tangible these service. When he bought this service
and tangible service he consider that place, people, and equipment.
2. Inseparability: You cannot separate the service. When you get service then you
involve and get service. Such as Beauty parlor.
3. Variability: First time get the service and you can determine this equitable service
but you cannot get this service in second time.
4. Perishability: It cannot stored this service, when you buy or receive this service.
3.13 Service quality concept
Service quality can thus be defined as the differences between customer expectation
of service and perceived service. If expectations are greater than performance, than
perceived quality is less than satisfactory and hence customer dissatisfaction occurs.
Service quality is considered an important tool for a firm’s struggle to differentiate
itself from its competitions.
3.14 Elements of service quality
Those are elements of service quality:
1. Organizations
2. Customer care
3. Communication
4 .Front line people
5. Leadership

49
3.15 Customer services concept
Customer service is the set of activities organizations to win and retain customers
satisfaction. Customer service includes;
Gaining confidence and trust of customer
.
3.16 Relationship between Customer Satisfaction and Banking
Business
Customer satisfaction is the key success factor of any service organization. Banks are
financial service firms, producing and selling professional manager of the public
funds and performing many other roles in the economy. Though, Rajshahi Krishi
Unnayan Bank is a state-owned commercial bank, like many other commercial banks,
it is an important service organization, have a vast base of customers. In fact, a wide
variety of demands of a large number of customers make it challenging for The
Rajshahi Krishi Unnayan Bank to satisfy the demands efficiently and keep customers
satisfied.
Banks are the most important one in the financial sector as the play a very crucial role
for the economy. Banking business mainly maintains flow of funds from depositors to
investors. In doing this, bank needs to collect deposit from the depositors and then
distribute those as loan to the investors. Besides, bank provides assistance in
international trade, money transfer, collection and payment of utility and other bills,
etc. All of which are fully customer oriented. Therefore, banks are treated as service
organizations and their business is largely dependent on the quality of services they
provide. Hence, the efficiency and success of commercial banks depend entirely upon
the satisfaction of their clients.

50
4.1 Prospect of Growth of Saddapushkaruni Branch, Rangpur
The target market of Rajshahi Krishi Unnayan Bank, Saddapushkaruni Branch,
Rangpur is a small and middle class businessman. The Branch is trying to expand its
target group. This branch always provides standard service to the customers.
Specially, this Branch is going on the basis of cost leadership and differentiation
strategy. This Branch is trying creating value than competitor’s services and this
branch has control cost driver such as learning resource proper utilization,
interrelationship. The future growth of this Branch is high because this Branch has
already achieved success in the following sections:
4.2.1 Increasing Trend of Expenses
Rajshahi Krishi Unnayan Bank,’Saddapushkaruni Branch, Rangpur expenses is
increasing day by day. In the year of 2012, 2013, 2014, 2015, 2016 the expenses were
Tk. 3400799.01 Tk. 4922552, Tk. 4122442.13 Tk. 6112222.09, and Tk. 7882484.97
respectively.
Figure-05: 5 years position of Expenses
Source: Manager,Saddapushkaruni Branch, Rangpur.
Interpretation: From the observation of the above figure it can be said that the
amount of deposits has increased from year to year. It is very essential for every bank
to increase its deposit. If the bank can collect more deposit then it can use it properly.
This increasing trend of deposit indicates customer satisfaction to the bank.
3400799.01 3922552
4122442.13
6112222.09
7882484.97
2012 2013 2014 2015 2016
Increasing Trend of expenses of RAKUB, Saddapushkarini
Branch, Rangpur
2012
2013
2014
2015
2016

51
4.2.2 Increasing Total Income: The total income of this branch was Tk. 6790200
during the year 2015. But due to efficiency of service, the Branch has been able to
increase its income day by day. The total income of this Branch was Tk. 8600441 up
to june 2016.
Figure-06: 5 years position of Total Income
Source: Manager,Saddapushkaruni Branch, Rangpur.
Interpretation:From the above table based data, we see that in every year the growth
increase highly than the immediate previous year. The sequence of this growth rate
gives a good symbol to Rajshahi Krishi Unnayan Bank a tremendous growth in
future in terms of increase trend of expenses, success in credit and advances,
tremendously increases of customer, increasing total income.
3792861.o9 4745000.03
5620001.64
6790200
8600441
2012 2013 2014 2015 2016
Increasing Trend of Total Income of RAKUB, Saddapushkarini
Branch, Rangpur
2012
2013
2014
2015
2016

52
4.2.3 Increasing Total Operational Profit/Loss: Rajshahi Krishi Unnayan Bank,
Saddapushkaruni Branch, Rangpurtotal profit is increasing day by day, their have no
loss . In the year of 2012, 2013, 2014, 2015, 2016 the profit were Tk. 392062.08, Tk.
822448.03 Tk. 1497559.51 Tk. 677978.00, and Tk. 717956.03 respectively.
Figure-07: 5 years position of Total Profit/Loss
Source: Manager’Saddapushkaruni Branch, Rangpur.
Interpretation: From this view point, we can see that the sequence of profit is
indicate that the branch goodwill because of their have no loss.
392062.08
822448.03
1497559.51
677978
717956.03
2012 2013 2014 2015 2016
Increasing Trend of Total Profit/Loss of RAKUB,
Saddapushkarini Branch, Rangpur
2012
2013
2014
2015
2016

53
4.2 SWOT analysis of Rajshahi Krishi Unnayan Bank (RAKUB)
Strengths Weaknesses
 RAKUB has already established a
favorable reputation in the in
baking industry of the country
 It has more reliability and
feasibility than any other
commercial bank
 Bank has many attractive deposit
schemes.
 State owned bank
 The number of depositors are more
than other bank.
 A good number of experienced
bankers in its management
 Most profitable bank in
Bangladesh.
 The activities of bank are
maintained manually in the rural
area
 Low remuneration package
 T Lobbing from upper level for
doing unfair activities hey have not
ATM booths
 Short time experiences in banking
industry.
 Training programs are not frequent
for the employees.
 Complex credit policy.
 Bureaucratic complexity in
Management
Opportunities Threats
 High contribution in economic
development
 The Branch has no efficient
marketing officers
 High demand of small
enterprise financing
 Money transfer easily in any
branches under Rajshahi and
Rangpur divison.
 Competitors have more flexible
deposit scheme.
 Increased competition for
market share in the industry

 Their have no available high
technology
 The employees take more time
to work that people dislike

54
4.3 FINDINGS:
RAKUB is an organization which is operating their business successfully in the
banking sector since 1987. Therefore, it is very tough to recommend on any aspect of
the company. However, as it is the requirement of the report so I have come up with
few recommendations, after conducting the research. They are as follows:
• RAKUB should try to improve the effectiveness of their alternate banking. From my
survey I have found that 50% customers are neutral about the effectiveness of the
alternate banking. So RAKUB should emphasize to decrease the numbers of neutral
customers about alternate banking.
• 64% customers have agreed that RAKUB should come with more new product and
services. RAKUB should extend their product for working woman and student.
• From my visit to RAKUB branches I have found that most of the branch of RAKUB
is too small. Size of their branch is another reason to get hazarded so they should try
to increase size of the floor of their branch.
• Upper level management of RAKUB should emphasize on the monitoring of
implementation of all the initiatives taken by RAKUB.
• RAKUB should monitor whether their tied up merchant shops are giving any
discountbenefit to their customers or not.
• RAKUB needs to make sure that customers are well familiar with their all new
initiatives.
• RAKUB should review their customer centric product model to find out more
improvement for their customers.
• From my survey I have found that RAKUB has a small number of customers whose
ages are less than 25. So RAKUB should look to the young generation too.
• Most of the customers of RAKUB have an income of in between 21000 to 80000.
Around 72% customers are in this group. So I guess RAKUB should emphasize more
on those customers who have a salary of more than 1 lakh.

55
5.1 Recommendations
After working three months in a Rajshahi Krishi Unnayan Bank, Saddapushkaruni
Branch we have found something really very fascinating about Rajshahi Krishi
Unnayan Bank. On the other hand from our analysis of last three months we would
like to recommend them something that can give them another thought.
 Rajshahi Krishi Unnayan Bank should pay more attention to increase the
facility of consumer loan products, small loan products .More deposit schemes
should be introduced to meet customer demands to stay ahead in competition
and better satisfaction of customer requirements.
 Customers ask for more quality service especially quick, accurate service and
good behavior from bankers as they think a private bank should provide such
quality sufficiently. It has been found that inappropriate and slow work
process often compels the customers to compare the bank with government
bank, which is bad for the reputation of the bank. Thus they should take
necessary steps to solve this problem.
 Reception to customers has a great impact on customer satisfaction because
customers are getting the first impression from the front desk. Rajshahi Krishi
Unnayan Bank should give more attention to care about the customer
reception. They should show the utmost honor, attention and courtesy
 Often customers complain that all customers are not treated equally. They
have to wait a long time to have a service. According to them valued and loyal
customers always get extra facility and customized services from officers
where normal customer do not Limited number of manpower is one of the
reasons of lower customer service. If RAKUB recruits more employees and
each and every employee are dedicated to their work than the quality of the
service will of course increase. All the customers should treat in same manner.
 Though RAKUB Perform faster activities but still some works are performing
manually which may hamper the flow of the work. Different documents are
kept in file which is difficult to find out. All the files and other necessary
things come from head office so it’s waste a lots of time and the regular flow
of work. Usages of latest technology should be increased and employee should
be skilled in operating that technology.

56
 Corporate culture of Rajshahi Krishi Unnayan Bank, Saddapushkaruni Branch,
Rangpur should be improved. Corporate culture is very important for an
organization. It will help employees to behave properly with customers as well
as with other coworker. Thus disagreement between employees and customers
over trivial matter will not occur. If corporate culture is established in a branch
then employees will be self-motivated and creation will increase. Even it will
help to work within group.
 The features of the products offered by is Rajshahi Krishi Unnayan Bank,
Saddapushkaruni Branch, Rangpur not enough. The demand of the customer is
high in comparison. Sometime customer claims that benefit that bank is
providing with the product is not that much attractive or useful for the
customers. The feature of those products should be great.
 Some of the customers are not satisfied with account opening procedure, like
for savings and current account sometimes they do not find any introducer; as
a result they cannot open the account even though they badly need to open the
account. Rajshahi Krishi Unnayan Bank should arrange introducer if
customers could not find any.
 Bank will have to make people aware about the different product of RAKUB
that the bank is offering and will have to explain the benefit of becoming
customer of RAKUB through different advertisements or marketing program.
 Effectively managed, customer feedback helps to create numerous
opportunities for the development of interpersonal relationships between the
customer and a firm's employees. This close alignment with the customer will
be of vital importance to the bank. It will provide regular and reliable
customer feedback and thereby the opportunity to make the necessary
proactive changes to improve services of Rajshahi Krishi Unnayan Bank. This
will enable the bank not only to act quickly to satisfy the customer but also to
prevent similar problems in the future

57
5.2 Conclusion
The popularity of banks’ is increasing day by day which leads to increase competition
as well. All the Commercial Banks are offering almost the same products and services
and their operation system is almost same. But the ways they provide the services are
different from each other. So people choose their bank according to their satisfaction
and needs. And they will prefer the bank of which service is easily accessible and
understandable. On the other hand, bank innovate new products and services to attract
their desired customers. In short, Rajshahi Krishi Unnayan Bank Commercial Bank
which is rendering all commercial banking services to the customers.
Rajshahi Krishi Unnayan Bank, Saddapushkaruni Branch, Rangpur has one principal
limitation that it is a government owned bank and it has to follow orders of the head
office. It cannot do anything what it wants. In spite of having opportunities, it cannot
implement those at its disposal. However, as one of the leading commercial bank, is
playing an important role in its area of business in Rajshahi Krishi Unnayan Bank,
Saddapushkaruni Branch, Rangpur mobilizing financial resources through deposit
collection and loan disbursement. It helps in creating and maintaining a sound
business environment in its business area. At present overall activity of this Branch is
well, though a little inflexibility in the position of service efficiency and total service
quality.
My study was attempted to explain the customer perception and satisfaction about
services quality of Rajshahi Krishi Unnayan Bank, Saddapushkaruni Branch,
Rangpur. Comparing the practical knowledge with that of theoretical involvements
we identified a few weakness in this branch and provides some recommendations for
solving the problems. Though it was not possible to go deep in each activity of all
sections because of time limitation we have been try to cover go through all
departments and sections. So, objectives of the study have not been fully met with
complete satisfaction. However, highest effort has been given to achieve the specific
objectives of the program.
From the internship program at Rajshahi Krishi Unnayan Bank, Saddapushkaruni
Branch, Rangpur, practical knowledge and overall customer-oriented banking
activities have gathered. This Branch provides various kinds of customer services but

58
its quality is not fully satisfactory. All kinds of customary services rendered by this
branch are not so good or satisfactory whereas the private commercial bank has
created a satisfactory image in rendering customary services.
Finally, it can be concluded that the authority needs more to think about the
followings:
 customer service and the level of customer satisfaction,
 improvement of the services of their product,
 more speed in banking operations,
 more efficiency in providing service.
Otherwise it will be very difficult for the Bank to compete with the other international
and native Banks that already have achieved such level of efficiency. Also the Branch
has to be very careful about the credit or advance related business. Overall awareness
of both depositors and the creditors has to be developed simultaneously for
continuous growth and development of both banking and financial sector of
Bangladesh. Finally more attentive and quick service can make this bank more
efficient to the customers’.

59
Bibliography
Books:
1. BESTERFIELD, DALE H., Quality Control, 6th
ed. Upper Saddle River,
NJ: Prentice Hall, 2001.
2. Kotler, Philip. “Marketing Management”. 11thed. New Delhi: Prentice-
Hall, 1999.
3. Kinnear, Thomas C., and James R. Taylor. “Marketing Research: An
Applied Approach”. 5thed. New Delhi: McGraw Hill, 2003.
4. Khan, AR “Bank Management.” A fund emphasis, (1sted.-2008), Dhaka,
Ruby Publications.
5. Saha & Chowdhuray, “Role of Commercial Bank in Development
Financing in Bangladesh” Bank Parikrama (March 2009) Vol. XXV.
Websites:
 Bangladesh Bank (http://www.bangladeshbank.org)
 Web Site of Rajshahi Krishi Unnayan Bank
(http://www.rakub.org.com.)
 http://en.wikipedia.org/wiki
Others:
i) Annual Reports of Rajshahi Krishi Unnayan Bank
ii) Statement of Affairs-2015& 2016 of RAKUB,Saddapushkaruni
Branch,Rangpur
iii) Ledger Book, RAKUB, Saddapushkaruni Branch, Rangpur.
iv) Various publications of Rajshahi Krishi Unnayan Bank

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Credit Management of Rajshahi Krishi Unnayan Bank: A Case Study on Saddapushkaruni Branch, Rangpur