Investment mechanism of al arafah islami bank limited

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Chapter – 01
Introduction

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1.1ORIGIN OF THE STUDY
The origin of the report lies in the academic obligation of doing an internship in an established
organization to successfully complete the BBA degree from Bangladesh University of Business
and Technology (BUBT). The primary goal of internship is to provide an on-the-job exposure to
the student and an opportunity to know how to implement theoretical concepts in real life
situation. Students are placed in enterprises, organizations, research institutions and as well as a
development projects. As a part of internship program, Al-Arafah Islami Bank Limited,
Khilkhet Branch was preferable for me.
This report is the result of three months internship program conducted in Al-Arafah Islami Bank
Limited and is prepared as a partial requirement for the complete of the BBA program of
Bangladesh University of Business and Technology (BUBT). As a result this report is submitted
based on the “Investment Mechanism of Al-Arafah Islami Bank Limited”. This report also
includes information on the product and services of Al-Arafah Islami Bank Limited, the
overview of the organization and also facilities they offer to satisfy their customers.
1.2BACKGROUND OF THE STUDY
As a requirement for the fulfillment of our BBA program from Bangladesh University of
Business and Technology (BUBT), I was assigned to perform Internship program. I have
gathered enough theoretical and practical knowledge, and then I wanted to put my potentialities
in the practical field. Al-Arafah Islami Bank Limited has given me the opportunity to
commence my Internship there from 16.07.2018 to 16.10.2018; which was a three months’
Internship program. This program was a combination of training & practical work at different
branches. Our honorable supervisor and officials of my assigned Branch have always helped me
a lot in this regard.

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1.3 SCOPE OF THE STUDY
The report covers the topic “General Banking of Al-Arafah Islami Bank Limited”. To
conduct a study on General Banking of AIBL, which a leading Bank on Shariah principles
among different Islamic Banks. The study focuses the functions of different department under
general banking division of AIBL. For conducting the study an overall knowledge of the total
banking system will necessary because the departments banking are linked with each other due
to some partial proceeding .The scope of the report covers the organization structure,
background, objective, function, departmentalization and business performance of AIBL Bank
Limited as a whole. The study also focuses the comparison of fees charged by Al-Arafah Islami
Bank Limited with Islami Bank Bangladesh Limited and First Security Islami Bank Limited.
The customer’s perception regarding the general banking of Al-Arafah Islami Bank Limited
also fall within the scope the report.
1.4 OBJECTIVES OF THE STUDY
1.4.1 Broad objective
The broad objective of this report is to analyze the general banking of Al-Arafah Islami Bank
Limited.
1.4.2 Specific objectives
 To know about the functions of different sections of general banking division of Al-
Arafah Islami Bank Limited.
 To know about the cheque and bill clearing process of Al-Arafah Islami Bank.
 To compare the services fees and charges of Al-Arafah Islami Bank Limited with Islami
Bank Bangladesh Limited and First Security Islami Bank Limited.
 To analyze the customer’s perception regarding the General Banking of Al-Arafah
Islami Bank limited.

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1.5 METHODOLOGYOF THE REPORT
1.5.1 ResearchDesign
The study is descriptive in nature. The study focuses on general banking activities of Al-Arafah
Islami Bank Limited. Comparison of different fees and charges of Al-Arafah Islami Bank
Limited with Islami Bank Bangladesh Limited and First Security Islami Bank Limited and
customer’s perceptions regarding general banking of are also studied in this report.
1.5.2 Description of Data
Both the primary and secondary data are used in the study. Primary data are collected from
observation and questionnaire through survey. Secondary data collected from annual report of
Al-Arafah Islami Bank Limited ,Islami Bank Bangladesh Limited and First security Islami
Bank Limited and schedule of charges of Al-Arafah Islami Bank Limited ,Islami Bank
Bangladesh Limited and First security Islami Bank Limited.
1.5.3 ResearchInstruments
 Questionnaire
Questionnaire is the research instruments and it is very flexible and easy to collect answer.
 Type of interviewing method
Face to face interview is taken to collect data.
 Types of questions
Structured questions with five response categories have used to conduct the survey.
 Size
There are 10 (ten) Questions in the Questionnaire.
 Scaling Technique
Likert scaling technique has been used with 5 response categories.

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1.5.4 Sampling Plan
 Population
The targeted population is the individual customer of Al-Arafah Islami Bank Limited
 Sample elements
The sample element is the individual customer of Khilkhet Branch.
 Sample Frame
Customer database of Al-Arafah Islami Bank Limited, Khilkhet Branch is the sample frame.
 Sampling Procedure
To gather the primary data through questionnaire, the sampling method I used was non-
probability convenience sampling.
 Sampling Size
The total of 50 samples has been selected from the target population.
 Time period of data collection
Last month of my internship period I collected all the data.
1.5.5 Data Analysis
The secondary data are analyzed using column diagram. In order to use analyze primary data
frequency distribution technique and pie chart are used.

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1.6 LIMITATIONS OF THE REPORT
The officers are very co-operative but they are too busy to give me time to get knowledge about
practical activities. Moreover they have to deal in a very competitive environment based on
money related activities. I have to prepare this report alone. Every task has some limitations. I
faced some usual constraints during the course of my internship. These are as follows:
 Short of time: I had to complete this report writing within a shorter period of time. So
the time constraint of the study hindering the course of vast area and time for preparing a
report within the mentioned period is really difficult.
 Busy working environment: The officials had some times been unable to provide
information because of their huge routine work.
 Lack of sufficient well informed officials: Many officials of the branch are not well
informed about different systems of Al-Arafah Islami bank Limited. They know but less.
I had to face much difficulty to collect this information.
 Insufficient data: Some desired information could not be collected due to confidentially
of business.

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Chapter - 02
An Overview of Al-Arafah
Islami Bank Limited

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2.1 HISTORICAL BACKGROUND OF Al-ARAFAH ISLAMI BANK
LIMITED
Islam provides us a complete lifestyle. Main objective of Islamic lifestyle is to be successful both
in our mortal & immoral life. Therefore, in every aspect of our life we should follow the doctrine
of Al-Qur’an and lifestyle of Hazrat Muhammad (sm) for our supreme success.
Al-Arafah Islami Bank Limited was established as private limited company, under the Company
Act, 1994 on 18 June 1995 for providing modern banking system based on Al-Qur’an and
sunnah. Al-Arafah Islami Bank is an interest free Shariah Bank of Bangladesh rendering all
types of commercial banking services under the regulation of Bank Company Act, 1991. The
Bank conducts its business on the principles of Musaraka, Bai-Murabaha, Bai-Muazzal and Hire
Purchase transactions approved by Bangladesh Bank. Naturally, its modes and operations are
substantially different from those of other conventional commercial banks. There is a Shariah
Council in the Bank who maintain constant vigilance to ensure that the activities of the Bank are
being conducted on the precepts of Islam. All activities of the Bank are conducted according to
Islamic Shariah where profit is the legal alternative to interest.
2.2 PROFILE OF AL-ARAFAH ISLAMI BANK LIMITED
With the achieving of objective pursuing the way directed by Allah and the path shown by His
Rasul (SM), Al-Arafa Islami Bank Ltd was established (resistered) as a private limited company
on 18 june 1995. The inaugural ceremony took on 27 September 1995 and Al-Arafah Islami
Bank Ltd.(AIBL) started journey with 5 branches. Al-Arafah Islami Bank Ltd.has 119 branches
(up to December 2017) and a total of 3446 employees (up to December 2017). Its authorized
capital is tk. 15000.00 million and the paid-up capital is tk. 9943.06 million as on 31st December
2017. Renowned Islamic Scholars and pious businessmen of the country are the sponsors of the
Bank 100% of paid up capital is being owned by indigenous shareholders.

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Al-Arafah Islami Bank Ltd. Was established not only to earn profit and to develop economy of
the country but also it had an ultimate goal to get reward in the Heaven by banning interest in
Business. Since its commencement the Bank has been trying to achieve this goal. The Islam
loving people specially who are not interested with interest, should help this bank giving deposit
and taking investment from this Bank.
2.3 OBJECTIVESOF AIBL
 To establish an interest free economy.
 To establish a modern banking system for all kinds of people.
 To take part in the economic growth of the country.
 To eradicate the poverty and to do social services by establishing Schools, Madrashas,
University, Hospitals, Public Library etc.
 Finally to achieve ultimate goal i.e. Nazat in Akhirat.

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2.4 CORPORATE INFORMATION
Name of the Bank Al-Arfah Islami Bank
Chairman Alhajj Abdus Samad
Vice Chairman Alhajj abdus Salam
Managing Director Md. Habibur Rahman
Company Secretary Abdul Hannan Khan
Legal Status Private Limited Company
Principal Activity Commercial Banking
Registered Office Peoples Insurance Building 36, Dilkusha C/A,
Dhaka-1000
Date of Registration 18 June, 1995
1st Branch Opening Motijheel Branch, Dhaka
Opening Ceremony 27 September, 1995
Authorized Capital 15,000.00 Million
Paid up Capital 9,943.06 Million
Local Partnership of Capital 100%
Equity 22,520.68 Million
Number of Branches 119
Deposit 244,806.26 Million
Investment 235,905.23 Million
Number of Manpower 3446
Number of Shareholder’s 30,386
Phone 9567885, 9567819, 9569353, 9568007
Fax 880-2-9569351
SWIFT ALARBDDH
E-mail aibl@al-arafahbank.com
Website www.al-arafahbank.com
Logo

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2.5 ORGANOGRAM OF AIBL
Advisor Chairman Board of Director
Managing Director (MD)
Senior Vice President (SVP)
Figure- 2.5: Organogram of AIBL.
Deputy Managing Director (DMD)
Executive Vice President (EVP)
Vice President (VP)
Asst. Vice President (AVP)
First Asst. Vice President (FAVP)
Senior Principal Officer (SPO)
Principal Officer (PO)
Senior Executive Officer (SEO)
Officer
Executive Officer (EO)
Officer
Messenger Gun Guard (MCG)

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2.6 BRANCH DEPARTMENT OF AIBL
A/C Import Short term
TT/DDP/O Export Long term
Clearing Remittance
Cash
Figure- 2.6: Different departments at the Branches of AIBL.
2.7 PRODUCT AND SERVICES OF AIBL
Al-Arafah Islami Bank Limited is providing many products and services to satisfy their
customers. For that reason, AIBL has made significant progress in all areas of its operations
within a short period of time, such as deposit mobilization, credit risk management. Remittance
handling and foreign exchange and trade. AIBL offers variety of products and services to the
customers which are picked up below:
2.7.1 General Banking:
 Current Account
 Savings A/C
 STD (Short Term Deposit) A/C
 Fixed Deposit Account
 3 Months Fixed Deposit
Departments of AIBL
General Banking Foreign Exchange Investment

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2.7.2 Deposit Services:
 Al Wadiah Current Deposit (CD)
 Mudaraba Short Notice Deposit (SND)
 Mudaraba Savings Deposit (MSD)
 Mudaraba Term Deposit (MTDR)
 Monthly Profit Based Term Deposit (ITD)
 Al-Arafah Monthly Hajj Deposit (MHD)
 Al-Arafah Termed Hajj Deposit (THD)
 Monthly Installment Based Marriage Savings Investment Scheme (MIS)
 Al-Arafah Saving Bond (ASB)
 Foreign Currency Deposit (FCD)
 Pension Deposit Scheme (PDS)
 Cash Waqf Deposit Scheme (CWD)
 Mudaraba Lakhpoti Deposit Scheme (LDS)
 Mudaraba Millionaire Deposit Scheme (MDS)
 Mudaraba (Special) Pension Deposit Scheme (MSPDS)
 Mudaraba Kotiipoti Deposit Scheme (MKDS)
 Mudaraba Double Benefit Deposit Scheme (MDBDS)

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2.7.3 Foreign Exchange:
 Central Crediting of Remittance
 Payment of 3rd Bank Remittances through TT & PO
 Payment of Spot Cash Remittances- Online & Web-based
 SMS Notification, SMS Push Pull Service
 Maintaining of NRD & NRT Accounts
2.7.4 Services of the Banks:
 ATM Card Service
 Online Banking
 Locker Service
2.7.5 Products of AIBL:
 Cash Management
 Wire Transfer
 Automated Clearinghouse (ACH) Transection
 Balance Inquiry
 Downloading Transaction Information
 Loan applications
 Investment Activity

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Chapter - 03
General Banking

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3.1 GENERALBANKING FUNCTION OF KHILKHET BRANCH
Financial institution/ intermediary that mediates or stands between ultimate borrowers and
ultimate lenders is knows as banking financial institution. Banks perform this function in two
ways- taking deposits from various areas in different forms and lending that accumulated amount
of money to the potential investors in other different forms. General banking department aids in
taking deposits and simultaneously provides some ancillaries services.
General banking is the front-side banking service department. It provides those customers who
come frequently and those customers who come one time in banking for enjoying ancillary
services. In some general banking activities, there is no relation between banker and customers
who will take only one service form bank. On the other hand, there are some customers with who
bank are doing its business frequently. It is an important department for all banks because it
provides day-to-day service to the customers.
Front Desk is the important for general banking. Customers give their deposits and meet their
demand for cash by honoring cheques. Besides this a customer opens new accounts, remit funds,
issues bank drafts and pay orders etc. There are various sections in this department, which are as
follows: -
 Cash Section
 Accounts Opening Section
 Clearing Section
 Remittance Section
3.2 CASH SECTION
The most important section of the branch is cash department. It deals with all kinds of cash
transactions. This department starts the day with cash in value 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 & payments. This figure is called closing balance.

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3.2.1 Books maintained this section:
a) Vault register: It keeps account of cash balance in vault in the bank.
b) Cash receipt register: cash receipt in whole of the day is recorded here.
c) Cash payment register: cash payment is made in a day are entered here.
d) Rough vault register: cash calculation for final entry in vault register is done here as any
error & correction is not acceptable.
e) Cash balance book: Balance here is compared with vault register if no correction is
found, indicates no error.
3.3 ACCOUNT OPENING SECTION:
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, may create fraud and other problems, their
account with bank and thus destroy goodwill of bank. Therefore, bank must be conscious in
selecting its customer. For this reason Al-ArafahIslami Bank Ltd. keep key information system.
3.3.1 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:
 Receiving filled up application in bank’s prescribed form mentioning what type of
account isdesired 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
firmsphotographs of all partners are taken
 Officer are taken information from customer by key information system

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 Applications must submit required documents
 Applications must sign specimen signature sheet and give mandate
 Introducer’s signature and accounts number-verified by legal officer
 Filling & signing up KYC or Know Your Customer Form
 Filling TP or Transaction Profile.
 Filling & signing up Owner Information Form
 Authorized Officer accepts the application
 Minimum balance is deposited-only cash is accepted
 Account is opened and a cherub book and pay-in-slip book is given
3.4 TYPES OF ACCOUNT
Account opening is the gateway for clients to enter into business with bank . A customer can
open different types of accounts through this department. Such as :
 Al-Wadia Current Deposit (CD):
Current account is purely a demand deposit account . There is no restriction on withdrawing
money from the account. It is basically justified when funds are to be collected and money is to
be paid at frequent interval.
 Mudaraba Short Notice Deposit (SND):
Mudaraba short notice deposit is a combination of account and savings account. This account is
opening process is like savings account . There is no restriction on withdrawing money from the
account .From this account 3% profit is given by the bank.
 Mudaraba Saving Deposit account(MSD):
To maintain smooth & certain life in future MSD is very suitable for middle class group. In this
account
 500Tk is the minimum amount of initial deposit
 Client cannot withdraw money more than twice in a week

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 The profit rate is 4% twice in a year.
 If client withdraw money more then 4time in a month, withdraw more then 50000Tk or
withdraw more than ¼ of saving then client don’t gate any profit.
 Mudaraba Term Depositnts (MTD):
It is a kind of fixed deposit. Fixied ammount money is deposit on the bank. Every month account
holder will get profit from this deposit .If the account holder wants he or she withdraws. Besides
he or she do not withdraw profit and wants to double the amount they can do it .
 Installment term deposit (ITD):
ITD is a sure investment for a steady return. It can be opened for 5, 8, 10 & 12 years for Tk200,
Tk300, Tk 500, Tk1000, Tk1500, Tk2000, Tk3000, Tk4000, and Tk5000 etc. there are some
important condition
 If the depositor wants to withdraw money before 5year then the saving interest rate will
be applied to pay some profit to the depositor.
 If the depositor unable to paid 3installment before 5year then profit will be given to the
depositor by mudaraba saving deposit base.
 Monthly Profit BasedTerm Deposit (PTD):
Monthly profit based term deposit like Mudaraba Term Deposit. Account holder every month
receives profit from the account.
 Al-Arafah Monthly Haji Deposit(MHD):
Haji deposit at monthly installment from 1 years to 20 years are accepted under the above
scheme to enable the account holder to perform Haji out of the accumulated savings with profit.

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 Al-Arafah Term Haji Deposit (THD):
Fixed amount of Haji deposits are accepted from the clients for particular term and as rules profit
is accumulted there on per year in this regard. As when the fix deposits is matured, Hajj expenses
are defrayed by the same. Under the scheme, the guardians may also open hajj account to enable
their successors to perform Hajj. Highest amount of profit is paid in the above types of deposit
by the bank.
3.5 SCHEME BASED ACCOUNT
 Mudaraba Lakhopati Deposit Scheme (LSD):
Lakhpoti that means make savings money like as one lakh TK. The account holder savings
money until lakh tk. He or she also receives 5% profit that added with main balance and certain
period it will be lakh tk.
 Mudaraba Millionaire Deposit Scheme (MMDS):
Who wants to be millionaire he or she can take this Mudaraba Millionaire Deposit Scheme. Who
take this scheme after a certain period will get One Million TK . from Al-Arafah Islami Bank. It
is account holder 80%of amount taka as loan for investment purpose.
 Monthly Installment BasedMarriage Saving Investment Scheme(MIS):
A fixed amount monthly installment for a particular period is to be deposited to defray the
expenses of marriage and the bank allows double of savings or TK 30000/- which is higher as
investment to procure ornaments , furniture etc. Repayable in 24 monthly installments without
any collateral security.
 Pension Deposit Scheme (PDS):
Pension Deposit Scheme one kinds of fixed deposit. Who want to take this package he or she
provide money for the maturity period of pension money .For this scheme the persons will get
more profit from the bank.

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 Cash Waqf Deposit Scheme (CWD):
It is a fixed deposit . This money is Waqf . Definite sectors will get the profit monthly. Never
they don’t get whole money they only get the profit ratio.
 Mudaraba Special Person Deposit Scheme (MSPDS):
It is an ITD package . The person wants to get high profit and long time scheme . When the
persons will get pension then he or she will break this scheme.
3.6 CLEARING SECTION
The main function of clearing section is to operate with safety and security of financial
transaction of financial instrument like DD, PO, check etc. on behalf of the customers through
Bangladesh Bank Clearing House, Outside Bank Clearing (OBC), Inter Branch Clearing (IBC).
3.6.1 Clearing:
Clearing is a system by which a bank can collect customers fund from one bank to another
through clearing house.
3.6.2 Types of Clearing:
 Inward clearing:
The Cheque or instruments of Al Arafah Islami Bank Ltd that are submitted to other
banks for collections of money of bills are called inward clearing. The following should be
checked very carefully;
 The check must be crossed.
 The check should not carry a date older then the receiving date for more than 6 months.
 The collecting bank must check whether endorsement is done properly or not.
 The amount both in words and figures in deposit slip should be same and also it should
be in conformity with the amount mentioned in words and figures in the checks.

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 Outward Clearing:
The Cheque or instruments of other banks that are submitted to the Al ArafahIslami Bank Ltd for
collection are called outward clearing. The procedures of Outward Clearing are followed:
 The instruments with schedules to the main branch of AL-ARAFAH-ISLAMI Bank Ltd.
With issuing an Inter Branch Debit Advice (1BDA).
 Clearing stamps are affixed on the instruments.
 Checked for any apparent discrepancy.
 The authorized signature endorses instruments.
 Particulars of the instruments and vouchers are recorded in the 'Outward Clearing'
register
 The clients receive the duty signed instruments and also branch code number affixed on
the instruments.
Table 3.6.2.1: Different cheque clearing process
Types of cheque Explanation Clearing process
Inward clearing
cheque
Cheque received from the
clearing house of AIBL.
Party’s A/C …..Dr
AIBL General A/C …..Cr
Outward Bills for
collection
Cheques of other branch of
AIBL within its clearing house
area.
These cheques are directly sent to the
respective branch & request them to sent
IBCA. When it comes, then customer’s
A/C is credited for the cheque
Clearing cheque Cheques another bank within
AIBL clearing house area
These cheques are sent to clearing house
khilkhet branch. When drawee bank
honor the cheques then the account of
cheque depositors are credited
Outward clearing Cheques for another bank
outside the clearing area
If any branch of AIBL exists within the
clearing house area of drawee bank then
AIBL sends the cheque to that branch of
AIBL & sends IBCA to it.

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Inward Bills for
collection
From other branch of AIBL These cheques are settled by IBCA i.e.
debiting depositor’s account & crediting
sender’s
From another bank outside the
clearing house
These cheques settle debiting depositors
account & sending DD, MT, TT in favor
of sender’s bank.
3.6.3 Clearing department:
This department of AIBL receives cheque, demand draft & pay orders of their clients. Upon the
receipt of the instrument the cheque clearing department examines three types of payment
modules.
Types of cheque collected by clearing department:
 Local bills collection cheques:
Local bills collection cheques are those cheques which are collected and paid by two
defferent branches of a bank situated in the same city.
 Outward bills collection cheques:
Outward bills collection cheques are those cheques which are collected and paid bye tow
different branches of same or differnt bank situated in the outstation.
 Transfer cheques:
Tranfer cheques are those cheques which are collected and paid bye the same branch of
AIBL.

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3.7 REMITTANCE SECTION
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 one place to another, from one
person to another inside or outside the national boundary is an earning sources of every bank.
AIBL khilkhet branch operate both the foreign & local remittance to serve its customers. In
addition this service is an important part of country payment system. Through this system people
can transfer their funds from one place to another place very quickly.
3.7.1 Foreign remittance: Foreign remittance is to send money of customers from one person to
another outside the national boundary. Through khilkhet branch AIBL is non-ad branch, it can be
able to serve the customers by receiving & paying their incoming foreign remittance in the form
of local currency. Foreign remittance is received by the bank via some internationally authorized
agent. There are two medium of agent for foreign remittance at AIBL khilkhet branch, these are
Money gram: is a money transfer medium/agent serves both domestic & international services.
Its identification number consist 8digit. For money gram customer national ID card &
identification 8 digits must be need for receiving money from bank.
 Local remittance:
Money can be remitted domestically which knew as local remittance. There are three ways of
transferring fund domestically .The modes of transferring funds are:
 Demand Draft (DD):
This is an instrument through which customers’ money is remitted to another person firm
organization in outstation in outstation outside the clearing house area from a branch of one bank
to an outstation branch of the some bank or to a branch of another bank with prior arrangement
between those banks with the issuing branch. This an order instrument in which the issuing

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branch gives instruction to the payee drawee branch to pay certain amount of money to the order
of certain person firm organization. The DD may be open without crossing or crossed. An open
DD can be over the counter to the payee endorsee by the payee drawee branch against proper
identification of the payee. The crossed DD is paid through the payees account only.
Procedures of issuing:
 Obtain Demand drafts application from duly filled in and signed by the
form purchaser applicant
 Receive the amount is case transfer with prescribed commission and
postage amount
 Issue the DD duly filled in and signed by the authorized signatories
 Insert test number (here applicable)
 Enter the DD issue register
 Issue advice to the payee branch. (IBCA)
.
 Pay order:
A Pay order is a written under issued by a branch of bank to pay a certain sum of money to a
specific person or a bank. It may be said as to be a banker’s Cheque as it is issued by a bank and
payable by itself.
Procedures for issuing:
 Obtain PO application from duly filed in and signed by the
purchaser/application.
 Receive the amount in cash/ transfer with commission amount
 Issue P/O
 Enter in P.O register

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 Telegraphic Transfer (TT):
This is a mode of transfer remittance of customers money from a branch of one bank to another
branch of the same bank or to a branch of another bank with prior arrangement between that
banks with the TT issuing branch through telegraphic message The issuing used to send the
message of such remittance to the Drawee/ payee branch through telegram adding certain code
number or test number on the basis of test key developed by the concern bank for its different
branches. The payee / Drawee branch on receipt of the message decodes the test a message and
being fully satisfied pay the amount by crediting the payees account (if account is maintained
with the payee branch). Now days the messages are passed through telephone /FAX/E-mail etc.
Recently the communication system has developed to a great extent.
Table 3.7.1.: Charge for issue Telegraphic Transfer
T.T issue Charge
@ 0.15% or minimum Tk 25/-
Plus Telephone/Swift/Telex Tk 30/
Procedure of issuing:
 Obtain TT application form duly filled in and signed by the
purchaser/applicant with the false account particulars of the beneficiary.
 Receive the amount in cash /transfer with prescribed commission postage
telephone / telex etc. charge
 Prepare TT message inserting test number
 Enter in TT issue register (code number).
 Issue advice to the payee branch.

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3.8 OTHER SERVICES
3.8.1 Locker Services
 Lockers:
Lockers are a safe custody of a bank for the clients .There are three types of lockers in
the bank.
Lockers operation: Lockers always operated jointly One of them is banker and another is
customer.
 Rent:
Lockers are allotted on yearly basis, for large size locker the rent is TK.300 and for medium size
the rent is TK.1200 and small size rent is TK.1000 only.
 Requirement:
 A locker holder must have a bank A/C i.e. MSD A/C.
 A locker holder should him important and reliable customer.
 Fill up an application form for a locker .
 One copy of PP size photograph that is introduced by a previous locker holder or
A/C holder.
3.8.2 Online Transaction:
Clients of any branch of AIBL can draw money from any branch of AIBL. This is a superior
service for the clients of AIBL than others. The online charge is TK.50 from TK. 50001 to
200000 and less than that is free. Customers have to pay VAT@ 15% on online
commission/charge. From 200000 to above the fee is 100. In case of deposit, less than
TK.100000 is free. Above TK. 100001 charge applicable.

28 | P a g e
Chapter - 04
Analysis of Al-Arafah Islami
Bank Limited

29 | P a g e
4.1 ANALYSIS OF SELECTEDBANK
4.1.1 Initial Deposit to open Savings & Current Accounts
Particulars Al-Arafah Islami
Bank Ltd.(AIBL)
First Security Islami
Bank Ltd.(FSIBL)
Islami Bank
BangladeshLtd.(IBBL)
Savings A/C(TK.) 500 500 500
Current A/C(TK.) 2000 1000 1000
Source: Schedule of bank charges of AIBL, FSIBL and IBBL
Figure: 4.1.1: Initial Deposit to open Savings & Current Account
Interpretation: The initial deposit to open savings account and current account of AIBL is not
equal to FSIBL and IBBL. Savings account holders have to pay TK.500 in AIBL, FSIBL, IBBL.
AIBL current account holder has to pay tk. 2000, FSIBL account holder has to pay tk. 1000,
IBBL account holder has to pay tk. 1000.
0
200
400
600
800
1000
1200
1400
1600
1800
2000
AIBL FSIBL IBBL
Savings A/C
Current A/C

30 | P a g e
4.1.2 Maintenance charge for Savings & Current Accounts
Bank Ltd.(AIBL)
First SecurityIslami
Bank Ltd.(FSIBL)
Islami Bank
Bangladesh.Ltd.(IBBL)
Savings A/C(TK.) 300 300 200
Current A/C(TK.) 500 500 500
Source: Schedule of bank charges of AIBL, FSIBL and IBBL
Figure: 4.1.2 Maintenance charge for Savings & Current Account
Interpretation: Maintenance charge for Savings and current account of AIBL is not equal to
FSIBL and IBBL. Savings account charge is TK.300 in AIBL and FSIBL and TK.200 in IBBL.
Current account charge is TK.500 in AIBL, FSIBL and IBBL.
0
50
100
150
200
250
300
350
400
450
500
AIBL FSIBL IBBL
Savings A/C
Current A/C

31 | P a g e
4.1.3 Account closing charge
Bank Ltd.(AIBL)
Bank Ltd.(FSIBL)
Islami Bank
Savings Account
Closing charge
200 200 200
Current Account
Closing charge
300 300 300
Source: Schedule of bank charges of AIBL,FSIBL and IBBL.
Figure: 4.1.3 Account Closing charge
Interpretation: The Savings account closing charge and current account closing charge of AIBL
is equal to FSIBL and IBBL. Savings account closing charge is TK.200 in AIBL, FSIBL and
IBBL. Current account closing charge is TK.300 in AIBL, FSIBL and IBBL.
0
50
100
150
200
250
300
AIBL FSIBL IBBL
Savings Account Closing charge
Current Account Closing charge

32 | P a g e
4.1.4 Cheque Book Issue charge per leaf
Bank Ltd.(AIBL)
Bank Ltd.(FSIBL)
Islami Bank
Cheque Book Issue
Charge per leaf (TK).
3.00 2.5 2.00
Source: Schedule of bank charges of AIBL, FSIBL and IBBL.
Figure: 4.1.4 cheque Book Issue charge per leaf
Interpretation: Cheque Book Issue Charge per leaf of AIBL is higher than FSIBL and IBBL.
Cheque Book Issue Charge per leaf of AIBL is TK.3.
0
0.5
1
1.5
2
2.5
3
AIBL FSIBL IBBL
Cheque Book Issue Charge per leaf

33 | P a g e
4.1.5 Number of Branches
Bank Ltd.(AIBL)
Bank Ltd.(FSIBL)
Islami Bank
Number of Branches 119 168 338
Source: Schedule of bank charges of AIBL,FSIBL and IBB
Figure: 4.1.5 Number of Branches
Interpretation: The number of branches of AIBL is less than FSIBL and IBBL. AIBL has 119,
FSIBL has 168 & IBBL has 338 branches all over the country.
0
50
100
150
200
250
300
350
AIBL FSIBL IBBL
Number of Branches

34 | P a g e
4.1.6 Number of ATM Booths
Particulars Al-ArafahIslami
Bank Ltd.(AIBL)
Bank Ltd.(FSIBL)
Islami Bank
Number of ATM
Booths
74 135 380
Figure: 4.1.6 Number of ATM Booths
Interpretation: Number of ATM booths of AIBL is lower than FSIBL & IBBL. Number of
ATM booths is 74 in AIBL, 135 in FSIBL & 380 in IBBL.
0
50
100
150
200
250
300
350
400
AIBL FSIBL IBBL
Number of ATM Booths

35 | P a g e
4.1.7 Demand Draft
Particulars Al-ArafahIslami
Bank Ltd.(AIBL)
Bank Ltd.(FSIBL)
Islami Bank
Commission 0.15% of amount at
demand draft or
minimum tk. 25
0.15% of amount at
demand draft or
minimum tk. 25
0.10% of amount at
demand draft or
minimum tk. 30
Vat 15% of Commission 15% of Commission 15% of Commission
Figure: 4.1.7 Commission & Vat on Demand Draft
Interpretation: Commission on demand draft of SEBL, AIBL& MTB is respectively 0.15% or
tk. 25 &0.15% or tk. 25 and 0.10% or tk. 30. On the other hand, Vat on demand draft of AIBL,
FSIBL & IBBL is similar which 15% of commission.
0
5
10
15
20
25
30
AIBL FSIBL IBBL
Commission
Vat

36 | P a g e
4.1.8 Pay Order Charges
Table 4.1.8.1 Pay Order Charges of AIBL
pay Order Amount Commission and Vat
Up to 1 lac BDT 20
Up to 1 lac to 5 lac BDT 30
Above 10 lac BDT 100
4.1.8.2 Pay Order Charges of FSIBL
Table 4.1.8.2 Pay Order Charges of FSIBL
Up to 1000 BDT 15
Up to 1000 to 1 lac BDT 25
Above 5 lac BDT 100
4.1.8.3 Pay Order Charges of IBBL
Table 4.1.8.3 Pay Order Charges of IBBL
Up to 10000 BDT 25
up to 10000 to 1 lac BDT 40
Above 5 lac BDT 200

37 | P a g e
Source: Schedule of bank charges of AIBL, FSIBL and IBB
Interpretation: The minimum pay order rate of AIBL is higher than FSIBL and lower than
IBBL. The above figure shows that AIBL provides many criteria of pay order range, such as
minimum range is up to 5 lac and the charge is BDT 25 and the pay order charge for above 5 lac
is BDT 100.

38 | P a g e
4.2 QUESTIONNAIRE ANALYSIS
In the survey it is essential to measure customer attitude towards general banking activities of the
Al-Arafah Islami Bank Limited. There are different types of respondent are use as sample
elements. The survey report is shown below with graphical represent in percentage basis.
4.2.1 Profession of the respondents:
Business Service Student Household Others
30% 42% 8% 15% 5%
Interpretation: The figure shows that 30% respondents of my questionnaire are business
person,42% respondents are service holder, 8% respondents are student,15% respondents are
household and 5% respondents are others. So the majority of the customers of khilkhet branch of
the Al-Arafah Islami Bank Limited are service holder.
30%
42%
8%
15%
5%
Profession of the respondents
Business Person
Service Holder
Student
Household
Others

39 | P a g e
4.2.2 It easy to open an account in Al-Arafah Islami Bank Ltd.
Respondent Opinion
Agree Strongly Agree Neither agree nor
Disagree
Disagree Strongly
Disagree
47% 17% 10% 20% 6%
Table: 4.2.2 It easy to open an account in Al-Arafah Islami Bank Ltd.
Figure: 4.2.2 It easy to open an account in Al-Arafah Islami Bank Ltd.
Interpretation: The graph show that 47% respondent of total respondents agreed that it is easy
to open an account in AIBL, and 17% strongly agreed and other 10% are neutral. On the other
hand 20% has disagreed that it is easy to open an account in AIBL and 6% strongly disagreed.
So, it has been found that most of the customers agree that account opening in AIBL is easy.
47%
17%
10%
20%
6%
It easy to open an account in Al-Arafah
Islami Bank Ltd.
Agree
Strongly Agree
Neither agree nor Disagree
Disagree
Strongly Disagree

40 | P a g e
4.2.3 Employees of SEBL provides friendly service.
Respondent Opinion
Disagree
Disagree Strongly
Disagree
65% 18% 7% 5% 5%
Table: 4.2.3 Employees of AIBL provides friendly service
Figure: 4.2.3 Employees of AIBL provides friendly service
Interpretation: The graphs show that 65% respondent of total respondents agreed, 18% strongly
agreed and 7% respondents are neutral that an employee of AIBL provides friendly service. On
the other hand 5% has disagreed that employees of AIBL provide friendly service and 5%
strongly disagreed. So, it has been found that most of the customers are agreed that employees of
the AIBL provide friendly service.
65%
18%
7%
5%
5%
Employees of AIBL provides friendly
service
Agree
Strongly Agree
Disagree
Strongly Disagree

41 | P a g e
4.2.4 The account opening process is lengthy.
Respondent Opinion
Disagree
Disagree Strongly
Disagree
45% 20% 10% 20% 5%
Table: 4.2.4 The account opening is lengthy
Figure: 4.2.4 The account opening process is lengthy
Interpretation: The graph shows that 45% of the customer is agreed and 20% is strongly agreed
that the account opening process is lengthy and 10% are neutral. On the other hand 20%
disagreed that the account opening process is lengthy and 5% is strongly disagree. So it can be
said that most of the respondents are satisfied about the account opening process of AIBL. It’s
not lengthy.
45%
20%
10%
20%
5%
The account opening process is lengthy
Agree
Strongly Agree
Disagree
Strongly Disagree

42 | P a g e
4.2.5 AIBL can efficiently solve customer’s problem.
Respondent Opinion
Disagree
Disagree Strongly
Disagree
35% 40% 6% 14% 5%
Table: 4.2.5 AIBL can efficiently solve customer’s problem
Figure: 4.2.5 AIBL can efficiently solve customer’s problem
Interpretation: The graph shows that 35% respondents agreed that employees of SEBL can
efficiently solve customer’s problem, 40% strongly agreed and 6% respondents are neutral. On
the other hand 14% disagreed that employees of AIBL can efficiently solve customer’s problem
and 5% strongly disagreed. So, it can be said that most of the customers are strongly agreed that
AIBL can efficiently solve customer’s problem.
35%
40%
6%
14%
5%
AIBL can efficiently solve customers problem
Agree
Strongly Agree
Disagree
Strongly Disagree

43 | P a g e
4.2.6: They are providing prompt service at cash section.
Respondent Opinion
Agree Strongly Agree Neither agree
nor Disagree
Disagree Strongly
Disagree
48% 12% 10% 20% 10%
Table: 4.2.6 They are providing prompt service at cash section
Figure: 4.2.6 They are providing prompt service at cash section
Interpretation: The graph shows that 48% respondents agreed that employees of AIBL are
providing prompt service at cash section, 12% strongly agreed and other 10% respondents are
neutral. On the other hand 20% disagreed that employees of AIBL are providing prompt service
at cash section and 10% strongly disagreed. . So it can be said that most of the respondents
agreed that they are providing good prompt service at cash section
48%
12%
10%
20%
10%
They are providing prompt service at cash section
Agree
Strongly Agree
Disagree
Strongly Disagree

44 | P a g e
4.2.7 Employees that providing general banking function is well informed about the bank
services.
Respondent Opinion
Disagree
Disagree Strongly
Disagree
40% 20% 4% 16% 20%
Table: 4.2.7 Employees that providing general banking function is well informed about the
bank services
Figure: 4.2.7 Employees that providing general banking function is well informed about
the bank services
Interpretation: The graph show that 40% respondents agreed, 20% strongly agreed and other
5% respondents are neutral. On the other hand 16% is disagreed and 20% strongly are disagreed.
So it can be said that in AIBL employees that providing general banking function is well
informed about the bank services.
40%
20%
5%
15%
20%
Employees that providing general banking
function is well informed about the bank services
Agree
Strongly Agree
Disagree
Strongly Disagree

45 | P a g e
4.2.8 AIBL provides satisfactory local and foreign remittance services.
Respondent Opinion
Disagree
Disagree Strongly
Disagree
50% 20% 7% 15% 8%
Table: 4.2.8 AIBL provides satisfactory local and foreign remittance services
Figure: 4.2.8 AIBL provides satisfactory local and foreign remittance services
Interpretation: The graph show that 50% respondent of total responded agreed that SEBL
provides satisfactory local and foreign remittance services,20% strongly agreed and other 7%
client has no comment. On the other hand 15% is disagreed that SEBL provides satisfactory local
and foreign remittance services and 8% strongly disagreed. So most of the respondents strongly
agreed that AIBL provides satisfactory local and foreign remittance services.
.
50%
20%
7%
15%
8%
AIBL provides satisfactory local and foreign remittance
services
Agree
Strongly Agree
Disagree
Strongly Disagree

46 | P a g e
4.2.9 Service charge of AIBL is reasonable compared to other banks.
Respondent Opinion
Disagree
Disagree Strongly
Disagree
35% 20% 20% 15% 10%
Table: 4.2.9 Service charge of AIBL is reasonable compared to other banks
Figure: 4.2.9 Service charge of AIBL is reasonable compared to other banks
Interpretation: The graph show that 35% respondents agreed that service charge of AIBL is
reasonable compared to other banks, 20% strongly agreed and other 20% respondents are
neutral. On the other hand 15% is disagreed that service charge of AIBL is reasonable in
compared to other banks and 10% strongly are disagreed. So it has been found that most of the
customers are agree that Service charge of AIBL is satisfactory and reasonable compared to
other banks.
35%
20%
20%
15%
10%
Service charge of AIBL is reasonable compared to
other banks
Agree
Strongly Agree
Disagree
Strongly Disagree

47 | P a g e
4.2.10 Pay order issuance procedure of AIBL is complex.
Respondent Opinion
Disagree
Disagree Strongly
Disagree
45% 25% 15% 10% 5%
Table:4.2.10 Pay order issuance procedure of AIBL is complex
Figure: 4.2.10 Pay order issuance procedure of AIBL is complex
Interpretation: The graph show that 45% respondent of total responded agreed that pay order
issuance procedure of AIBL is complex,25% strongly agreed and other 15% respondents are ne .
On the other hand 10% is disagreed that pay order issuance procedure of AIBL is complex and
5% strongly disagreed. So it has been found that most of the customers are strongly agree that
Pay order issuance procedure of AIBL is complex.
45%
25%
15%
10%
5%
Pay order issuance procedure of AIBL is complex
Agree
Strongly Agree
Disagree
Strongly Disagree

48 | P a g e
4.2.11 Waiting time to get services from AIBL is longer.
Respondent Opinion
Disagree
Disagree Strongly
Disagree
35% 25% 10% 20% 10%
Table: 4.2.11 Waiting time to get services from AIBL is longer
Figure: 4.2.11 Waiting time to get services from AIBL is longer
Interpretation: The graph show that 35% respondent of total responded agreed that waiting
time to get services from AIBL is longer,25% strongly agreed and other 10% has no comment.
On the other hand 20% is disagreed that waiting time to get services from AIBL is longer and
10% strongly disagreed. So it can be found that most of the customers agreed that waiting time to
get services from AIBL is longer.
35%
25%
10%
20%
10%
Waiting time to get services from AIBL is longer
Agree
Strongly Agree
Disagree
Strongly Disagree

49 | P a g e
Chapter - 05
Findings, Recommendations
&
Conclusion

50 | P a g e
5.1 FINDINGS
The analysis of general banking of Al-Arafah Islami bank limited reveals the following findings:
 Initial deposit to open current account of Al-Arafah Islami Bank Ltd. is higher than that of
First Security Islami Bank Limited and Islami Bank Bangladesh Limited. But initial deposit
to open savings account of the three banks is same.
 Maintenance charge for savings account of Al-Arafah Islami Bank is higher than that of
Islami Bank Bangladesh Limited.
 Cheque book issue charge per leaf of Al-Arafah Islami Bank Ltd. is higher than that of First
Security Islami Bank Limited and Islami Bank Bangladesh Limited.
 Number of branch and ATM booth of AIBL is lower comparing to the other two banks.
 Conducting the questionnaire survey it was observed that majority of the respondents of
AIBL are satisfied with the services provided by the bank.

51 | P a g e
5.2 RECOMMENDATIONS
Recommendations of this report have been made on the basis of the research findings for the
further improvement of the general banking division of Al-Arafah Islami Bank Limited.
 As the initial deposit for current account is high, Al-Arafah Islami Bank Limited should
reduce the initial deposit for current account.
 Maintenance charge for savings account of AIBL is higher than that of IBBL. So Al-
Arafah Islami Bank Limited should reduce the maintenance charge for savings account.
 The bank should reduce the cheque book issue charge .
 The bank should increase the number of ATM booth to facilitate customers more .
 AIBL should develop new and convenient scheme and modernized system to maintain
and improve its current position

52 | P a g e
5.3 CONCLUSION
The Banking area in recent time is one of the most competitive business fields in Bangladesh. As
Bangladesh is a developing country, a strong banking sector can change the socio economic
structure of the country. So we can say, the whole economy of the country in linked up with its
banking system. Al-Arafah Islami Limited is the bank which is highly potential commercial
Bank of Bangladesh. This bank performs hundreds of important activities both for the public and
for the government as a whole. It has an outstanding bearing to thrive our business sector. It has
strong performance on General Banking, Investment, and foreign exchange. This system is
accepted in Islamic Shariah because here money is converted to goods.’ Money begets money’ is
prohibited in Islamic Shariah. People are getting more benefit from the dealings of Islamic
banking because here quarterly interest is not charged and there is no possibility of interest to be
converted into principal. It cannot take part in call money market. Mudaraba, Musharaka are
another mode of investment in Islamic Banking. But here honesty is the only pre-requisite. For
ensuring more benefit, more facility from Islamic banks like Al-Arafah Islami Limited we have
to be honest and more sincere to repay the taken money from these banks in time.
I had the privilege to learn many things from the general banking Corporate Branch through my
active involvement in this branch. In this paper I have tried to highlight General Banking
Business of Al-Arafah Islami Limited. With wide network of branches at home and also a large
number of correspondent banks worldwide it is singularly handling the large volume of export-
import business including homebound remittances. The effective and efficient general banking,
investment and foreign exchange business of the Bank helps in the continuous growth and
progress of national economy

53 | P a g e
Chapter - 06
Reference & Appendix

54 | P a g e
6.1 REFERENCE
 kothari, C.R. “Research Methodology”, Second Edition, New Age International
Publishers.
 Al-ArafaIslami Bank Limited , Annual Report 2017.
 First Security Islami Bank Limited, Annual Report 2017.
 Islami Bank Bangladesh Limited, Annual Report 2017.
 Al-Arafah Islami Bank Limited, Schedule of Charge , viewed on November,2018 from
https://al-arafahbank.com/Schedule-Charge.php.
 First Security Islami Bank Limited, Schedule of Charge, viewed on November ,2018
fromhttp://www.fsiblbd.com/inline-online-transaction/
 Islami Bank Bangladesh Limited, Schedule of Charge , viewed on November ,2018
fromhttps://www.islamibankbd.com/utilities/charges.php.

55 | P a g e
6.2 APPENDIX
Questionnaire Survey:
Bachelor of Business Administration (BBA)
Bangladesh University of business & Technology (BUBT)
(For study intention only)
This is the formal questionnaire developed to collect information from you for preparing an
internship report regarding the topic General Banking Operation of Al-Arafah Islami Bank
Limited. This is the formal questionnaire developed to collect information from you for
preparing report. In this regard, I expect authentic support from you as a valuable respondent. I
promise that your given information will be kept secret and will not be misused.
[ personal detail of the respondent]
Section-A
 Name:
 Age:
 Gender: a. Male b. Female
 Occupation: a. Business b. Service c. Student d. Household e. Others
Section-B
 What types of account do you have?
a. Savings b. current c. MTD d. Others
 How long have you been a customer of AIBL?
a. 0-3 years b. 3-5 years c. 5-10 years d. More

56 | P a g e
Would you please identify the level of your satisfaction regarding bank service?(Use tick
marks)
Question Agree Strongly
Agree
Neither
Agree nor
Disagree
Disagree Strongly
Disagree
(1)It is easy to open an account in
AL-Arafah Islami Bank Limited.
(2)Employees of Al-Arafah Islami
Bank Ltd. provide friendly
service.
(3)The account opening process is
lengthy.
(4) Al-Arafah Islami Bank Ltd.
can efficiently solve customer’s
problems.
(5)They are providing prompt
service at cash section.
(6)Employees that providing
general banking function is well
informed about the bank services.
(7)AIBL provide satisfactory local
and foreign remittance services.
(8)Service charge of AIBL is
reasonable compared to other
banks.
(9)Pay order issuance procedure
of AIBL is complex.
(10)Waiting time to get services to
AIBL is longer.

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