Internship Report on Sustainable Financial Inclusion and Poverty Alleviation through Smart Banking at Bank Asia

Internship Report
On
Sustainable Financial Inclusion and Poverty Alleviation

through Smart Banking: A Case of Bank Asia Ltd.
Submitted to
Department of Finance
Jagannath University, Dhaka
Date of Submission: 30 October, 2013.

Sustainable Financial Inclusion and Poverty Alleviation through Smart Banking: A Case of Bank Asia Ltd
Under the Supervision of
Md. Sogir Hossain Khandoker

Associate Professor
Jagannath University, Dhaka.
Submitted By
Md. Mazharul Islam

Id: 091541
Reg. No: 082264
4th Year, 2nd Semester
Session: 2008-2009
Department of Finance Jagannath University, Dhaka

Letter of Transmittal
30 October, 2013

Associate Professor
Subject: Submission of Internship Report
With due respect, I would like to state that it is a matter of great pleasure and honor for
me to submit my internship report on Sustainable Financial Inclusion and Poverty
Alleviation through Smart Banking: A Case of Bank Asia Ltd. assigned as my topic of
internship In preparation of this report I have followed and maintained the format and
rules of a formal internship report as instructed by you. The internship program gave
the opportunity to have an insight on the Banking sector of Bangladesh through Bank
Asia Limited.
The Consignment was of great worth and appeal, as it helped me hone my analytical
skills abilities and practical knowledge in the field of Alternative Delivery Channels and
helped me become familiarized with the corporate world. I have tried heart and soul to
make the report effective and useful.
The internship program was very much valuable to me as it helped me to gain

experience from the practical field. I am grateful to you for providing me this
opportunity of gaining such practical experiences and to know how theoretical
knowledge is applied in the real world. Please accept my report and I will be glad to
clarify any discrepancy that may arise.
Sincerely Yours
..
Md. Mazharul Islam
ID: 091541
Reg. No: 082264
4th Year 2nd Semester
Department of Finance Jagannath University, Dhaka i|Page

Letter of Authorization
I am very pleased to declare that Md. Mazharul Islam, Registration No 082264, 4th year
2ndsemester, Department of Finance, Jagannath University, Dhaka has been given with the
topic Sustainable Financial Inclusion and Poverty Alleviation through Smart Banking: A
Case of Bank Asia Ltd. for researching and writing an internship report on the subject. He
has reviewed all the relevant literature and has been surveyed practically in Alternative
Delivery Channel, Corporate Branch, Bank Asia Limited for three months to collect both
of primary and secondary data. I have supervised him throughout the preparation of the
internship paper.
I also certify that the internship paper is an original one and has not been submitted elsewhere
previously for publication in any form.
He is wished all the best in his effort.
.
Associate Professor
Department of Finance Jagannath University, Dhaka ii | P a g e

Acknowledgement
First and foremost of all, I would like to convey my heartiest gratitude and total
devotion to almighty Allah for blessing me with the ability, strength and patience as well
as keeping me active in performing my internship task successfully.
It gives me immense pleasure to thank a large number of individuals for their cordial
cooperation and encouragement who have contributed directly or indirectly in
preparing this report. Firstly, I express my gratefulness to Almighty who has enabled
me to pursue my study.
I would like to thanks from the core of my heart to my honorable supervisor Md. Sogir
Hossain Khandoker, Assistant Professor Department of Finance, Jagannath University,
Dhaka for his in help every steps of my internship, proper instructions, suggestions and
evaluations, which helped me to generate the report in the proper way.
I would like express my heartiest gratitude to Mr. Quazi Mortuza Ali (FVP and Head of
Alternative Delivery Channel, Bank Asia Limited), Mr. Md. Moniruzzaman Khan (FAVP),
Mr. Md. Zakir Hossain Bhuiyain (FAVP), Mr. A.K.M Abdul Muyeed Khan (SEO) and Mr.
Md. Kamrul Islam (Executive Officer) for their caring supervision. I am also greatly
indebted to Mr. Md. Shihabul Alam(SO), Mr. Akram Hossain (JO), Mr. Md. Samiul Kaisar
(BO), Mr. Shahinur Rahman(BO), Aziza Khatun(BO), Ummey Sayma(BO), Mr. Md.
Mizanur Rahman(TO), Mr. Mamunur Rashid (ARO), Mr. Sirajul Islam (ARO)for their
intimate care and supervision. I practically work with them and in this report tried to
share their perceptions and feelings on the basis of my realization, from my own point
of view.
Then at last I shall be grateful to those persons who read this report and who shall get
benefit from this report at present and future.
Department of Finance Jagannath University, Dhaka iii | P a g e

Executive Summary
Financial inclusion is alternatively known as inclusive financing which attempts to

deliver financial services at affordable costs to the common man so that large sections of
society can be served. Bangladesh stands second among South Asian nations in ensuring
access to financial services for its citizens, a recent study found. There is now a wealth
of evidence from worldwide research that suggests financial inclusion plays a critically
important role in poverty reduction, reducing income disparities and increasing
economic growth. In achieving this objective, the banking sector plays an important
role. Bank Asia Ltd is one of the banks. Bank Asia Ltd emerged as a new commercial
bank to provide efficient banking services and to contribute socio-economic
development of the country. If we look at our financial inclusion scenario we find a
hopeless proportion. More than 50% population of our county is still outside the ambit
of organized financial sector. It is important to work for overall improvement of the
economy and finance. With this view, Bank Asia joined with government project Ekti
Bari Ekti Khamar (EBEK). The intrinsic goal of the project is to reduce national poverty
to 20% from 31.5% by 2015 through developing each of the houses as a unit of agro
economic activities by utilizing human and financial resources of the family members.
To achieve the goal the project takes specific objectives with precise target and time
frame. Bangladesh is one of the least developed countries in the world in terms of per
capita income and literacy rate. Bangladesh accounts for a significant portion of the
worlds poor with nearly 31.5% people living below the poverty line. Hence the
eradication of poverty occupies the foremost place in Bangladeshs development
programs. Review of documents and experience over the last three decades both
explicit and implicit shows that different strategies and actions were taken in the past to
combat poverty in the country. Despite all these efforts and implementation of various
programs, poverty still continues to be pervasive and overwhelming. However, there is
sufficient evidences to believe that the existing poverty cycle can be broken if the poor
are allowed to have access to resources and justice. Keeping these facts in mind the
proposed project has been undertaken to enhance the status of the rural poor. The
project will cover 40527 villages in 4503 unions under 485 Upazila of the country. The
project will enable the rural poor and the community people to find for their self-
Department of Finance Jagannath University, Dhaka iv | P a g e

employment opportunities with the physical and financial supports to be offered by the
project. Besides, the village organizations to be organized under the project would be
the driving force to mobilize the poor including the women. In this way the
disadvantaged and excluded groups of people including the women would be integrated
with the process of empowerment. Thus, the project will help to increase production of
all types and alleviate rural poverty. The study has revealed that there exists significant
relationship between financial inclusion and pervasive poverty.
Department of Finance Jagannath University, Dhaka v|Page

Table of Contents
Sl. No. Particulars Page No
Letter of Transmittal i
Letter of Authorization ii
Acknowledgement iii
Executive Summary iv
Abstract 2
1.1. Introduction to the Study
1.1.1 Introduction 2
1.1.2 Review of Literature 3
1.1.3 Rationale of the Study 3
1.2. Objectives of the Study 4
Chapter 1 1.2.1 General Objectives 4
1.2.2 Specific Objectives 4
Introduction
1.3. Research Methodology 5
1.3.1 Primary Sources of data 6
1.3.2 Secondary Sources of data 6
1.4. Data Analysis & Presentation Technique 7
1.5. Limitations 7
2.1. Background of Bank Asia 8
2.1.1 Vision, Mission & Core Values 9
Chapter 2 2.1.2 Salient Features of Bank Asia 10
2.1.3 Products & Services 11
Background of Bank 2.1.4 Corporate Milestones 13
Asia 2.1.5 Corporate Office 14
2.1.6 Operating Profit Ratios 15
2.1.7 Performance Ratios 15
3.1. Financial Inclusion 17
3.2 Financial Exclusion 18
3.3Benefits of Financial Inclusion 18
3.4Scope of the Initiatives of Financial Inclusion in
Chapter 3 19
Bangladesh
3.5. Financial Inclusion and Development Indicators 19
Sustainable Financial
3.5 Financial Inclusion Indicators 20
Inclusion and
Poverty 3.6 The Status of the Overall Financial Inclusion in
21
Bangladesh
3.7 Overall Financial Inclusion 23
3.8 Regression Analysis 24
3.9 Barriers to financial inclusion 26

3.10 Role of Bank Asia for enhancing Financial

27
Inclusion
3.11 Alternative Delivery Channel 28
3.12 Mobile Banking 28
3.13 Agent Banking 29
4.1Introduction of EBEK 32
4.1.1 Vision 33
4.1.2 Project Background 34
4.1.3 Project Targets 36
4.1.4 Target Beneficiaries 36
4.1.5 Rationale 36
Chapter 4
4.2 EBEK of Bank Asia Limited 37
EKTEE BARI EKTEE 4.2.1 What is EBEK Mobile Banking system of Bank
37
KHAMAR (EBEK) Asia?
An Example of 4.2.2. Structural Diagram of EBEK mobile Banking 38
Financial Inclusion 4.2.3 Why Bank Asia involved in this Project? 38
4.2.4 Major Stakeholders 39
4.2.5 EBEK Project Milestone 41
4.2.6 Project Work Flow 42
4.2.7 EBEK Workflow in Existing Manual System 43
4.2.8 Process of Account Opening 48
4.2.9 Process to fill up Institutional Account Opening
49
Form:
4.2.10 Process to fill up Individual Account Opening
52
Form
Chapter-5 My Practical experience at Bank Asia Ltd
My Practical (ADC department) 54
experience
6.1. Findings 57
Chapter-5 6.2. Recommendations 58
6.3. Conclusion 58
Recommendations
and Conclusion References 59
Bibliography 60
Acronyms 61

Chapter -1
Introduction
Department of Finance Jagannath University, Dhaka 1|Page

Abstract:
Financial inclusion has emerged as a tool to achieve inclusive growth for poverty
reduction since 2005, a year that the UN has declared International Microcredit
Year. Studies (King et. al, 1993; Beck et. al, 2000, 2004; Levine, 2005 and Demirgc-
Kunt et. al, 2008) indicate that a positive correlation exists between financial
development and economic growth. Current development theories suggest that
greater financial inclusion can have a positive impact on the lives of the poor.
(Keyword: Financial Inclusion, Smart Banking, ADC, EBEK, Poverty Alleviation)
1.1 Introduction to the Study
1.1.1 Introduction:
The access to finance debate has strongly focused over the past years on the provision of
credit. But there seems to be a shift lately, with a number of stakeholders and policy-makers
rediscovering the benefits and the crucial role of savings, as a core basic banking service.
This is undoubtedly connected to the crisis context, and the value of building a safety net to
be used in case of extreme need. It is also linked to the fast expansion of microcredit, and the
evidence that to reach its full effectiveness, microcredit has to be accompanied by micro
saving, as a key enabler to finance productive activities.
The poor can be empowered by financial inclusion, i.e. giving them the initiative and
encouraging them to participate in the financial system of the Bangladesh. Bangladesh
Government has already run a project named Ekti Bari Ekti Khamar along with 3 renowned
private commercial bank for this purpose. Bank Asia is playing a critical role in this regard.
If economic development should ultimately result in individual freedom, the contribution of

the Banking sector to economic development will not be complete unless and until they
empower the bottom of the pyramid through financial inclusion.
Financial inclusion or in other words, bigger and deeper banking systems go hand in hand
with more advanced economic development. The purest purpose of money in particular in a
dematerialized form is to serve as a more efficient means of exchange than do barter and
counter-trade. The purpose of bank based money as opposed to pure cash is two-fold. First, it
is a better store of value. Second, it allows economies to gear up their working capital
(savings) to form also a platform for long-term capital (investment) through the maturity
transformation process that only banks can effectively make. Obviously money, and more
particularly bank-based money, can only provide these advantages when the transaction costs
of operating a bank account are below the inefficiency costs (and middle-mans margin) of
managing barter and counter-trade. All this is particularly crucial in poorer developing
countries, where evidence shows that availability of credit does increase economic activity
but to become financially self-sustaining, this has to be augmented by small scale savings
mobilization.

1.1.2 Review of Literature
Bangladesh Government, donors, and international financial institutions across the globe
have increasingly recognized that access to financial services can play a pivotal role in
poverty alleviation and in decreasing the vulnerability of poor people. Though never part of
the Millennium Development Goals(MDGs) set in 2000, financial inclusion as an issue has
moved up the agenda of emerging and developing countries, including at the G20 in 2011 and
through the Alliance for Financial Inclusion, which led to 35 emerging and developing
countries central banks committing themselves to financial inclusion in 2012.
Yet 2.5 billion people remain financially excluded. In most developing countries, more than
two-thirds of the adult population has no access to formal financial services, and in sub-
Saharan Africa, financial exclusion is as high as 76 per cent. Exclusion is typically highest
amongst women, youth and the very poorest segments of society.
The low and unpredictable income of poor people makes it difficult for them to bank with
formal financial institutions. Likewise, national and international banks have struggled to find
a business case for reaching the worlds poorest people given the expectations of their
shareholders and the desire for sufficient profit margins. As a result, poor people have largely
discounted formal financial institutions and vice versa. Instead, they have traditionally relied
on potentially exploitative yet reliable moneylenders. The microcredit boom of the 1990s
sought to engage poor people in the semi-formal financial sector, but some irresponsible
credit lending by profit-oriented institutions has seen the sector called into question. There
has also been increased recognition that poor people need a range of financial services not
just credit, given that their incomes are low, unpredictable and irregular
.
Financial inclusion has been defined as the provision of access to appropriate, convenient,
usable, valuable and affordable financial services and products to the widest part of the
population, especially through the delivery of basic banking services to the low income
people and the still unbanked, as a way out of poverty (WSBI Santiago Declaration 2009).
As per the definition, the products and services offered under financial inclusion should fulfill
a number of requirements that fall into three dimensions: the geographical dimension, by
providing financial products to underserved population in rural and remote areas; the product
dimension, by offering accessible and affordable services, adapted to the specific needs of
low income population and the time dimension, by maintaining a more permanent
relationship with clients and following more stable policies in the good and bad times.
1.1.3 Rationale of the Study
The report titled Sustainable Financial Inclusion and Poverty Alleviation through Smart
Banking: A Case of Bank Asia Ltd. is prepared as an integral part of the internship program
of the undergraduate degree in Department of Finance, Jagannath University. To get
acquainted with different financial model and theory theoretical knowledge is not enough for
a student of Department of Finance. There always exists massive gap between theoretical
knowledge and its practical implementation with present technology based world. This report
is to bridge up this gap.

Bank executives looking to attract new customers while engaging and reducing the attrition
of existing customers can use alternate delivery channels as an end to their means. In this
report, I aim to examine the critical success factors and challenges that exist in the delivery
financial inclusion in Bangladesh. This report will be helpful to understand the relationship
among General banking and Alternative delivery channel or Smart Banking. And also the
performance trend of Bank Asia. The research approach will be to investigate and discover
the range of answers to our research questions and then present findings, solutions, and
conclusions to readers.
1.2. Objectives of the Study
The objective of the study may be viewed as:
General objective
Specific objective
1.2.1General Objectives
The primary objective of my internship program is to gain practical work experience in the field
of Banking Business that helps me to complete my BBA program required under Department of
Finance, Jagannath University and get an overall idea of how financial inclusion eliminates
poverty through smart banking and specially the performance of Bank Asia Ltd on this
context.
1.2.2 Specific Objectives

More specifically, this study entails the following aspects:
To analyze the performance of Bank Asia Limited.

To identify major challenges of Bank Asia to formulate financial inclusion.
To assess the existing modules of financial inclusion.
To explore the way of poverty elimination from Bangladesh.
To know the Online Bank Management Software and its applications.
1.3. Research Methodology

This report is mainly prepared by the secondary sources of information and some few
primary sources of information. The research was an exploratory approach and data
collection and analysis are qualitative in nature. For this purpose, different recognized census,
government rules, regulations, policies, and laws, newspapers, national and international
journals, periodicals have been consulted. Besides this, Internet has been widely used since
the report focuses on Online and Electronic Banking system. Data collection and analysis
were made during the Internship period at Bank Asia Limited.

1.3.1 Primary Sources of data
The primary data of this report were collected through:
Personal Observation, Direct interview & Conversation with the Officers, Practical
experiences obtained from the corporate office of Bank Asia Limited, Experts
opinion And Official records.
1.3.2 Secondary Sources of data
I have gathered the secondary data via following sources:
Texts regarding Electronic Banking.

Annual report of Bank Asia Limited.
Printed outlines and documentation supplied by Bank Asia Limited.
Annual Financial Statement of last 4 years of different Banking Institutions.
Website of Bank Asia Limited (http://www.bankasia-bd.com/)
Internet sources.
Methodology
Framework
Alternative Delivery Channel Of Bank Asia
Primary Data Secondary Data

* Interview * Newsletters
* Observation * Printed Outlines
* Conversation * Websites
* Official Records * Annual Reports
Problem Findings and

Recommendations

1.4. Data Analysis & Presentation Technique
In order to analyze gathered data, I have used statistical software that run different statistical
test, Correlation, regression and such. Also I have used MS-Excel to generate charts and
graph of different ratio analysis. The data has been presented through graphs for better visual
understanding.
1.5. Limitations
In preparing this report, many obstacles came in my path. These are:

Primary data is always hard to work on because of authenticity.
Time is another hindrance to prepare a quality report.
The time is not enough to prepare this report because of maintaining full time office
hour during internship.
Due to bank restrictions, much relevant information is not possible to represent in the
report.

Chapter -2
Background of Bank Asia

2.1. Background of Bank Asia Limited
The economy of Bangladesh has been experiencing a rapid growth since the 90s.
Industrial and agricultural development, international trade, inflow of expatriate
Bangladeshi workers remittance, local and foreign investments in construction,
communication, power, food processing and service enterprise ushered in an era of
economic activities. Urbanization and lifestyle changes concurrent with the economic
development created a demand for banking products and services to support the new
initiatives. A group of highly acclaimed businessmen of the country grouped together to
respond to this need and established Bank Asia Limited in the year 1999.
The Bank Asia Limited incorporated as a public limited company under the Companies
Act. 1994. The bank started its commercial operation on November 1999 with an
authorized capital of Tk.800 million and paid up capital of Tk.218 million. The paid up
capital of the bank stood at Tk. 6,305 million as on 31st December 2012.
Within a short span of time Bank Asia Limited has established itself as one of the fast
growing local private banks. It has at present a network of 73 branches serving many of
the leading corporate houses and is gradually moving towards retail banking. Its other
significant delivery channel is the shared ATM Network. Bank Asia Limited has 48 ATMs
as a member of ETN along with eleven other banks. Since its humble beginning in 1999,
it set milestone by acquiring the business operations of the Bank of Nova Scotia in
Dhaka, first in the banking history of Bangladesh. It again repeated the performance by
acquiring the Bangladesh operations of Muslim Commercial Bank Ltd. (MCB), a
Pakistani bank. Last year the Bank again came to the limelight with over subscription of
the Initial Public Offering of the shares of the Bank, which was a record (55 times) in
our capital markets history and its shares commands respectable premium.
Bank Asia Limited has been actively participating in the local money market as well as
foreign currency market without exposing the Bank to vulnerable positions. The Banks
investment in Treasury Bills and other securities went up noticeably opening up
opportunities for enhancing income in the context of a regime of gradual interest rate
decline.
Bank Asia Limited is maintaining its competitiveness by leveraging on its Online

Banking Software and modern IT infrastructure. It is the pioneer amongst the local
banks in introducing innovative products like SMS banking, and under the ATM
Network the Stelar Online Banking software enables direct linking of a clients account,
without the requirement for a separate account.
Bank Asia Limited has successfully established a transparent process of recruitment

seeking the best talent. In its efforts towards continuous development of the human
resources of the Bank, it arranges training programs throughout the year.

Bank Asia has been launched by a group of successful entrepreneurs with recognized
standing in the society. The management of the Bank consists of a team led by senior
bankers with decades of experience in national and international markets. The senior
management team is ably supported by a group of professionals many of whom have
exposure in the international market.
The asset and liability growth has been remarkable. Bank Asia has been actively
participating in the local money market as well as foreign currency market without
exposing the Bank to vulnerable positions. The Bank's investment in Treasury Bills and
other securities went up noticeably opening up opportunities for enhancing income in
the context of a regime of gradual interest rate decline.
Bank Asia Limited started its service with a vision to serve people with modern and
innovative banking products and services at affordable charge. Being parallel to the
cutting edge technology the Bank is offering online banking with added delivery
channels like ATM, Tele-banking, SMS and Net Banking. And as part of the bank's
commitment to provide all modern and value added banking service in keeping with the
very best standard in a globalize world.
2.1.1. Vision, Mission & Core Values
Bank Asia is a third generation public limited commercial bank. It received the
Certificate of Incorporation on September 28, 1999 and came to operation on November
27, 1999. Now after 12 faithful years of dedicated and reliable services, Bank Asia has
created an envious position for itself among the leading banks of the country with an
Asset base of TK. 117 billion, Deposit of TK 95 Billion and 70+ outlets all over the
country. But most importantly, the Bank has an unsurpassed legacy attached with its
image.
Pay-Off Line/Slogan
FOR A BETTER TOMORROW
Vision
Bank Asia's vision is to have a poverty free Bangladesh in course of a generation in

the new millennium, reflecting the national dream. Our vision is to build a society
where human dignity and human rights receive the highest consideration along with
reduction of poverty.
Mission
To assist in bringing high quality service to our customers and to participate in

the growth and expansion of our national economy

To set high standards of integrity and bring total satisfaction to our clients,
shareholders and employees
To become the most sought after bank in the country, rendering technology
driven innovative services by our dedicated team of professionals
Core Values
Place customer interest and satisfaction as first priority and provide customized
banking products and services
Value addition to the stakeholders through attaining excellence in banking
operations
Maintain high ethical standard and transparency in dealings
Be a compliant institution through adhering to all regulatory requirements
Contribute significantly for the betterment of the society
Ensure higher degree of motivation and dignified working environment for our
human capital and respect optimal work-life balance
Committed to protect the environment and go green
2.1.2. Salient Features of Bank Asia
Only Bangladeshi Bank to acquire (Purchase) operations of 02 (two) foreign

banks namely
o Bank of Nova Scotia of Canada
o Muslim Commercial Bank of Pakistan
Majority stakeholder of ERA INFOTECH (A joint Venture IT Company)
Centralized Trade Services Operation (Facilitates Export/ Import and Inward
and Outward Remittance foreign-AD Branches)
Central Clearing Fully Automated
Online Charges Free
Credit Rating (CRAB: valid up to June 2013)
o Long Term: AA2(pronounced double A two)
o Short Term: ST1
Commercial Banks rated in this category is adjudged to be very strong banks,

Characterized by very good financials, healthy and sustainable franchises and a first
rate-operating environment. Rating in this category is characterized with commendable
position in terms of liquidity, internal fund generation access to alternative sources of
fund.
Department of Finance Jagannath University, Dhaka 10 | P a g e

2.1.3 Products & Services
Business Banking
Overdraft, Secured Overdraft, Secured OD (Earnest Money), Working capital finance,

Loan against Trust Receipt, Loan against Cash Incentives, Bill discounting, Loan
Syndication and structured Finance, Packing Credit, Demand Loan, Demand Loan (work
order), Time Loan, Transport Loan, House Building Loan, Term loan, Lease Finance,
Letter of Guarantee, Letter of Credit, Back to back Letter of Credit.
Consumer Finance
Auto Loan, Consumer Durable Loan, Unsecured Personal Loan, House Finance, Loan for
Professionals, Senior Citizen Support.
Small and Medium Enterprise (SME)
Term Loan
Subidha -Unsecured Trading, Sondhi -Secured Trading, Sristi Unsecured

Manufacturing, Shombridhi- Secured Manufacturing, Shofol Unsecured Service, Sheba-
Secured Service
Over Draft
Somadhan Secured
Special Products
Utshob- Seasonal Business, Subarno- Women Entrepreneur
Treasury
Money Market
Overnight Call, Repo and Reverse Repo, Swap, Sale and Purchase of Treasury Bill&
Bond, Term Placement, Term Borrowing.
Foreign Exchange Market
Spot, Forward, Interbank Buy / Sale.
Deposit Accounts
Saving Account, Current Account, Short Notice Deposit, Fixed Term Deposit, Foreign
Currency Account, Deposit Pension Scheme, Monthly Benefit Scheme, Double Benefit
Scheme, Triple Benefit Scheme, Bank Asia Sanchoy Plus.

Credit Cards
MasterCard Local Credit Card, VISA Dual Currency Credit Card, VISA Local Credit Card,
VISA Butterfly Credit Card, VISA Mini Credit Card, VISA International Card against RFCD,
RQ A/C, Virtual Card, SME Credit Card, NBFI Card Cheque, International Prepaid Hajj
Card.
Service Product
ATM Services, Remittance Service, Locker Service, Online Banking, Internet Banking,
Phone Banking, Mobile Banking, Remote Banking (EBEK), SWIFT, Centralized Trade
Services, Student File, Travellers Cheque.
Islamic Banking
Deposit Products
Al-Wadiah Current Account (AWCA), Mudaraba Savings Account (MSA),Mudaraba

Special Notice Deposit Account (MSNDA), Mudaraba Term Deposit Account (MTDA) of
differentTenure, Mudaraba Hajj Savings Scheme (MHSS), Mudaraba Deposit Pension
Scheme (MDPS), Mudaraba Monthly Profit Paying Deposit Scheme(MMPPDS), Smart
Junior Saver (SJS)
Investment Products
Bai Murabaha Muajjal, Hire Purchase Shirkatul Melk (HPSM), Musharaka, Quard against
Accepted Bills
Off-shore Banking Unit (OBU) Product
On-shore Bill Discounting through OBU, Bill Discounting, Capital Finance, Working
Capital Finance, Trade Finance, On-shore Export Bill Discounting
Capital Market Operation
Brokerage Operation, Margin Loan

2.1.4. Corporate Milestones
Name : Bank Asia Limited
Chairman: Mr. A. Rouf Chowdhury
Key People: Mr. Md. Mehmood Husain, (President & Managing Director)
Company Registration Number: C38707 (665)/99 on September 29, 1999
Bangladesh Bank Permission Number: BRPD (P) 744(78)/99-3081 on October 5, 1999
Official Logo:
SL
Information Details/ Amount
No.
01. Certificate of Incorporation 28/09/1999
02. Certificate of Commencement of Business 28/09/1999
03. Banking License 06/10/1999
04. First Branch License 31/10/1999
05. Inauguration of Bank 27/11/1999
06. Only Bangladeshi bank to acquire operations 2001 (Bank of Nova Scotia, Canada)
of 02 foreign banks namely: Bank of Nova 2002 (Muslim Commercial Bank of
Scotia, Canada and Muslim Commercial Bank Pakistan)
of Pakistan
07. Date of IPO subscription 23-24/09/2003
08. IPO oversubscribed by: 56 times
09. Date of First Share Trading in Bourse 08/01/2004
10. Number of Shareholders and Shares (at the 17,161 (shareholders) 630,570,000
end of 2012) shares
11. Date of First Subscription with CDBL 20/12/2005
12. Date of First Script-less Trading 30/01/2006
13. Commenced Operation of Off-Shore Banking 28/01/2008
14. Commenced Operation of Islami Banking 24/12/2008
15. Member, Dhaka Stock Exchange (DSE)
16. Commenced Operation of Capital Market 5/08/2009
Division
17. Number of Promoters 22
18. Number of Directors 13
19. Number of Branches 73
20. Number of SME Service Centers 10
21. Number of Agricultural/SME Branch 6
22. Number of Brokerage Branches 5
23. Number of Islamic Banking Wing 5
24. Number of ATM booths Own - 48, Shared-240 (Q-cash), Cash
Link (125+)
25. Number of KIOSK 3

26. Number of employee till December, 2012 1485

27. Number of foreign correspondents (in 2012) 776
28. Beneficiaries from Corporate Social Cataract Operation - 885
Responsibility (CSR) Programs H.S. Scholarship - 215
Comp. Learning Centers (25) - 3000+
Students
29. Authorized Capital Tk. 15,000,000,000
30. Paid up Capital Tk 6,305,748,720
31. Revenue 7,821 mln
32. Net Income 908 mln
33. Deposits (as of 31/12/2012) Tk.1,10,175.53crore
34. Advance (as of 31/12/2012) Tk.93,410.43crore
35. Export (as of 31/12/2012) Tk. 66,478.34
36. Import (as of 31/12/2012) Tk.106,746.15 mln
37. Remittance (as of 31/12/2012) Tk.32,110.10 mln
38. Total assets (at the end of 2012) Tk.141235.37mln
39. Credit Rating Status AA2 - Long Term ST-1 - Short Term
40. Income tax to Government (in 2012) 1831mln
41. Statutory Reserve (in 2012) 3,503.96 mln
42. Retained for investment and future growth 267mln
(in 2012)
2.1.5. Corporate Office
Rangs Tower (2nd to 6th Floor)

68,PuranaPaltan
Dhaka-1000.
Tell : 02- 7110042, 7110062, 7110147, 7110173, 7110177, 7110218,
Fax : 88-02-7175524,
E-mail :bankasia@bankasia.com.bd
Web : www.bankasia-bd.com , www.bankasia.net

2.1.6. Operating Profit Ratios

OPERATING PROFIT RATIOS
Particulars 2012 2011 2010 2009 2008
Credit Deposit ratio 83.89% 87.06% 92.06% 91.67% 94.20%
Cost of Deposit 9.49% 9.09% 7.15% 8.97% 9.84%
Administrative Cost 2.82% 2.88% 2.08% 2.76% 2.33%
Yield on Loans and Advances 15.20% 14.11% 12.72% 13.95% 14.41%
Spread 5.71% 5.02% 5.57% 4.98% 4.57%
Return on Assets 0.70% 1.72% 2.22% 2.18% 1.87%
Return on Equity 7.11% 19.61% 32.12% 32.03% 23.00%
Current ratio 93.48% 105.03% 94.79% 92.23% 98.30%
Debt Equity ratio 9.76 8.43 13.90 12.86 15.01
2.1.7. Performance Ratios

PERFORMANCE RATIOS
Particulars 2012 2011 2010 2009 2008
Profit per Employee 3.40 3.18 3.43 2.54 2.38
Operating profit as % of Working 3.60 3.43 4.04 3.81 3.57
Funds
Net Interest income as % of 3.61 3.33 3.76 3.76 3.45
Working Fund
Burden Coverage 63.58 83.8 88.41 77.85 86.13
Burden ratio 0.01 -0.11 -0.37 -0.06 -0.14
Expense Coverage 99.37 105.38 113.12 102.44 106.44
Efficiency Ratio 35.40 36.88 36.2 36.63 34.15
Ratio of Fees Income 22.51 33.2 32.01 28.51 29.41
Salary Exp. to total Overhead Exp. 46.74 46.75 42.18 39.45 43.87
Salary Exp. to Fees Income 73.52 51.93 47.71 50.68 50.94
Cost to Income ratio 35.40% 36.88% 36.31% 36.63% 34.15%

Chapter -3
Sustainable Financial Inclusion
and Poverty
When we want to help the poor, we usually offer them charity. Most often we use charity to
avoid recognizing the problem and finding the solution for it. Charity becomes a way to
shrug off our responsibility. But charity is no solution to poverty. Charity only perpetuates
poverty by taking the initiative away from the poor. Charity allows us to go ahead with our
own lives without worrying about the lives of the poor. Charity appeases our consciences.
- Dr. Muhammad Yunus

3.1. Financial Inclusion
While the need to promote financial inclusion has received global importance, a
consensus has not been reached on the definition of financial inclusion. The provision of
financial services from banks is sometimes referred to as financial inclusion, but
financial inclusion actually refers to a broader concept.
Financial inclusion also refers to the ability of individuals to access appropriate financial
products and services (House of Commons Treasury Committee, 2006). An
understanding of appropriate financial products and services includes financial
awareness, knowledge about banks and banking channels, facilities provided by the
banks and advantages of using the banking channel. The Center for Financial Inclusion
(CFI), an affiliate of US-based nonprofit ACCION International, argues that quality
financial services in a full inclusive financial system would be provided at affordable
prices, in a convenient manner, and with dignity for the clients. Mainstream providers
considered as officially regulated and supervised entities provide quality products
developing capacity and usage of financial services reflected in the perfect financial
inclusive system (European Commissions Report, 2008).
Rahman (2009) defines financial inclusion in Bangladesh as access to financial services

from officially regulated and supervised entities in which banks and financial
institutions are licensed by the Bangladesh Bank, MFIs by the Microcredit Regulatory
Authority (MRA), registered cooperatives by the Department of Cooperatives; and
official entities themselves including post offices and National Savings Directorate.
Microfinance activities in Bangladesh, pioneered by Nobel laureate Dr. Yunus and
replicated extensively worldwide, have been expanding the access of financial inclusion.
Yunus is essentially highlighting the difference between CSR and sustainable financial
inclusion. Financial inclusion, for banks, has become one of the underlying principles of
their business activities. Access to finance is an essential driver of economic growth in
developing and transition economies. It is also important in developed economies,
where it stimulates the social inclusion of certain groups of the population. Access to
finance empowers people, gives them the opportunity to have an account, to save and
invest, to insure their homes or to take a loan and in many cases to break the chains of
poverty.
Bangladesh stands second among South Asian nations in ensuring access to financial
services for its citizens, a recent study found.
Around 66 percent of the households in Bangladesh now have access to services
including credit, savings and insurance from banks or microfinance institutions (MFIs)
and cooperatives, according to Institute of Microfinance (InM).
The country comes second only to Sri Lanka, where 80.4 percent of the population is
covered by the financial umbrella. In contrast, only 48 percent of the households in
India have access to such services and 60 percent in Pakistan.

It has been observed that financial inclusion as percentage of the total population
increased to 56.43 percent in 2010 from 39.76 percent in 2004.
Access to Credit
% of Total Population 60 54.12
50
40 36.64
30 21.78
20
7.99
10
0
Aggregate Formal Quasi-Formal Informal
3.2. Financial Exclusion:
Financial exclusion refers to the lack of access to financial services. It limits

opportunities for employment and enterprise development and imposes a premium on
the cost of basic services. Financial exclusion thus makes it difficult to reduce
inequalities and alleviate poverty. Becket. al(2008) finds that financial exclusion is a
barrier to economic development. Financially excluded populations include marginal
farmers, landless labors, unorganized enterprises, urban slum dwellers, migrants,
senior citizens and women. Financial inclusion is thus a high priority policy goal for
developing and developed countries in order to ensure stable and equitable economic
growth.
3.3. Benefits of Financial Inclusion
Access to credit in the formal sector may also open up entrepreneurship

opportunities for low income populations and increase the scope for
investment.
Linkages with the formal financial sector enable clients to access different credit,
savings and insurance products with soft conditions provided by regulated
institutions. In terms of cost, easy access to the formal financial sector reduces
the growth of informal sector credit provided by moneylenders, which can often
be expensive and exploitive.
An account can be used for multiple purposes including making payments for
essential utilities, receiving benefits from government programs; therefore
contributing to financial deepening.
Studies suggest that access to financial services allows the poor to save money
safely outside their homes, prevents the concentration of economic power with a
few individuals and helps to mitigate the risks that the poor face as a result of
economic shocks or natural calamities (Mehrotraet. al, 2009).

3.4. Scope of the Initiatives of Financial Inclusion in Bangladesh
Agent Banking: to empower the unbanked.

Government-to-person (G2P) payments: to make social safety net payments to
the poor and destitute more effective and cost effective.
Person-to-government (P2G) payments: to reduce time and cost, and also the
influence of the rent-seekers on poor citizens when they travel far to access
government services.
Person-to-person (P2P) remittance payments from abroad and within the
country: to bring down cost of transaction for both the persons and also for the
financial institutions.
Insurance and credit delivery and management: to contribute to an area which
is emerging as the most recent frontiers in mobile/electronic payment mechanisms
especially for rural underserved population?
Micro-insurance: to provide to the poor access to proper risk management tools
and reduce their vulnerability to falling back into poverty.
Micro-credit: to lower the cost of microcredit transactions and in turns the
interest rate to poor borrowers.
3.5. Financial Inclusion and Development Indicators
The Financial inclusion and the development indicators of some of the countries are
given below:
Country Composite Index* of Poverty Rate (%) Unemployment Rate

Financial Inclusion (%)
Bangladesh 32 31.5 3.3
India 48 28.6 4.3
Brazil 43 22.0 9.7
China 42 4.6 4.0
Indonesia 40 27.1 9.9
South Korea 63 0.00 3.5
Malaysia 60 15.5 3.5
Philippines 20 36.8 9.8
Sri Lanka 26 25.0 9.0
Thailand 50 13.1 1.5
Source: World Bank 2011
Data presented in the above table is quite self-explanatory and has been projected
graphically in the successive diagrams. Diagram 1 confirms that the countries having
high poverty ratio are poorly financially included as against the countries that have high
composite index of financial inclusion with low poverty levels.

70 63 60
60 48 50
50 43 42 40
40 32
36.8 26
30 31.5 28.6 20
27.1 25
20 22
15.5 13.1
10
4.6
0 0
Composite Index* of Financial Inclusion Poverty (%) rate
Diagram 1
Diagram 2 endeavors to delineate the association between the financial inclusion and
the unemployment rate. Countries such as Korea, China and Malaysia are deeply
financially included with least or no poverty incidence.
70 63 60
60 48 50
50 43 42 40
40 32
26
30 20
20 9.7 9.9 9.8 9
10 3.3 4.3 4 3.5 3.5 1.5
0
Composite Index* of Financial Inclusion

Unemployment Rate (%)
Diagram 2
3.6. Financial Inclusion Indicators
1. Number of branches per 1,000 km

2. Number of branches per 100,000 adults
3. Number of ATMs per 1,000 km
4. Number of ATMs per 100,000 adults
5. Number of agents per 1,000 km
6. Number of agents per 100,000 adults

3.7. The Status of the Overall Financial Inclusion in Bangladesh
Access to Bank
2.1 Geographical penetration indicates that number of bank branch per 1000 square
kilometer increased from 44.24 in 2005 to 53.34 in 2010. Number of ATM booth per
1000 square kilometer increased tremendously from 0.82 in 2005 to 14.43 in 2010
(Chart 1). In term of demographic penetration, number of branches per 100,000
populations increased from 4.67 in 2005 to 5.72 in 2012. Number of ATM per 100,000
populations increased from 0.09 in 2005 to 3.06 in 2012 (Chart 2). Trend in
geographical and demographic penetration indicates that access to banking is
increasing overtime in Bangladesh.
Chart 1: Geographic Penetration of Chart 2: Demographic Penetration

Banking Services 7 of Banking Services
25 22.21 5.72
19.2 19.76 20.76 6 5.08 5.28 5.49
18.56 4.67 4.72 4.78 4.86
20 17.95 5
14.43 4
15 3.06
3 2.18
10 7.96 2 1.43
5 0.51 0.8
5 2.84 1 0.09 0.17 0.29
0.82 1.66 0
0 2005 2006 2007 2008 2009 2010 2011 2012
2005 2006 2007 2008 2009 2010
No. of Bank Branches per 1000 sq km No. of Bank Branches per 100000 pop
No. of ATMs per 1000 sq km No. of ATMs per 100000 pop
Access to banking in rural areas in terms of bank branch expansion, number of

deposit a/c, number of credit a/c was quite impressive during 2005-2010. Recent
data show that in rural areas total rural bank branch grew, on average, about 3.39
percent during 2005-2010 as against the 4.75 percent growth in urban areas during
the same period. Number of deposit account grew by 11.91 percent in rural areas
between 2005 and 2010 while the same was 7.82 percent in urban areas during the
same period. Number of credit account during the same period increased, on an
average of 0.54 percent in rural areas as against 4.41 percent in urban areas during
2005-2010.

Chart 3: Deposit account per 1000 Chart 4: Loan account per 1000
900 persons 120 persons
765.25 100.69
800 90.36 92.81
665.66 685.22 100 87.99 89.86 89.8
700 640.51
586.72 619.51 80
600
500 60 52.77 52.87 50.16 50.21 50.28 50.82
400
40
300
189.17
200 126.45 125.06 124.82 129.92 131.93 20
100 0
0 2005 2006 2007 2008 2009 2010
2005 2006 2007 2008 2009 2010
Urban Rural Urban Rural
Number of deposit and loan account per 1000 population were 241.52 and
61.57respectively in 2005 which increased to 333.19 and 63.29 respectively in 2010
(Chart 5).
Chart 5: No. of deposit and loan accounts per 1000

350
Population 333.19
300 263.86 270.25

241.52 248.77 253.74
250
200
150
100 61.12 62.12 60.07 60.24 60.91 63.23
50
0
2005 2006 2007 2008 2009 2010
No. of deposit accounts per 1000 population
No. of deposit accounts per 1000 population2

3.8. Overall Financial Inclusion
Rate of overall financial inclusion is increasing in modest pace. The overall financial rate
is given in Table. It is observed that financial inclusion as percentage of total population
increased from 39.76 percent in 2004 to 56.42 percent in 2010. In terms of adult
population, it increased from 65.33 percent in 2004 to 87.23 percent in 2010 due to
opening a significant number of 10 Taka account in the last two years.
Poverty headcount
Financial Inclusion
Financial Inclusion
poverty line (% of
Adult Population
Total Population
Bank branch (in
ratio at national
Unemployment
Population per
as % of adult
as % of total
population)
Population
Population
Number)
Rate (%)
(million)
(Million)
Year
1999 73.16 111.46 18669 50.2

2000 75.16 111.46 18347 48.9 3.3
2001 77.18 123.15 19886 45.2
2002 79.59 129.25 20753 42.1
2003 80.80 133.40 21406 66.21 40.10 41.3 4.1
2004 82.25 135.20 21443 65.36 39.76 40.5 4.3
2005 83.80 137.00 21420 71.41 43.68 40.0 4.3
2006 84.60 138.80 21171 77.33 47.13 38.9 2.5
2007 87.08 140.60 20320 74.36 46.05 37.4 2.5
2008 89.62 142.40 20566 77.63 48.86 36.3 2.5
2009 92.24 144.20 19681 78.61 50.28 33.5 4.8
2010 94.50 146.10 18947 87.23 56.42 31.5 5.1
Source: World Bank Report 2012 & BBS.
Bangladesh experienced a uniform and steady decline in poverty rates between 2000
and 2010. Poverty declined 1.8% annually between 2000 and 2005, and 1.7% annually
between 2005-2010.

3.9. Regression Analysis

By analyzing the above table, a regression analysis is made through SPSS software
version 17.
Descriptive Statistics
Mean Std. Deviation N
povertyline 37.4250 3.48579 8

popperbank 20619.2500 926.76762 8
fininadltpop 74.7675 7.15152 8
finintotlpop 46.5350 5.51872 8
unemploymnt 3.7625 1.09144 8
Correlations
povertyline popperbank fininadltpop finintotlpop unemploymnt
povertyline 1.000 .978 -.912 -.951 -.303
popperbank .978 1.000 -.867 -.911 -.328
Pearson Correlation fininadltpop -.912 -.867 1.000 .993 .084
finintotlpop -.951 -.911 .993 1.000 .159
unemploymnt -.303 -.328 .084 .159 1.000
povertyline . .000 .001 .000 .233
popperbank .000 . .003 .001 .214
Sig. (1-tailed) fininadltpop .001 .003 . .000 .422
finintotlpop .000 .001 .000 . .354
unemploymnt .233 .214 .422 .354 .
povertyline 8 8 8 8 8
popperbank 8 8 8 8 8
N fininadltpop 8 8 8 8 8
finintotlpop 8 8 8 8 8
unemploymnt 8 8 8 8 8
From this table we can see that, there is a negative correlation between financial inclusion of
total population and poverty line. That is highly significance.
Model Summary
Std. Error of the
Model R R Square Adjusted R Square Estimate
1 .996a .991 .980 .49449

a. Predictors: (Constant), unemploymnt, fininadltpop, popperbank, finintotlpop

R-square can take on any value between 0 and 1, with the value .995 that is closer to 1
indicating that a greater proportion of variance is accounted for by the model. R-square
value of 0.991 means that the fit explains 91.10% of the total variation in the data about
the average.
ANOVAb
Model Sum of Squares df Mean Square F Sig.
Regression 84.321 4 21.080 86.210 .002a
1 Residual .734 3 .245
Total 85.055 7
a. Predictors: (Constant), unemploymnt, fininadltpop, popperbank, finintotlpop
b. Dependent Variable: povertyline
Coefficientsa
Standardized
Unstandardized Coefficients Coefficients
Model B Std. Error Beta t Sig.
(Constant) 20.782 17.975 1.156 .331
popperbank .001 .001 .305 1.467 .239
1 fininadltpop .844 .409 1.732 2.065 .131
finintotlpop -1.515 .621 -2.399 -2.440 .093
unemploymnt .104 .225 .033 .463 .675

a. Dependent Variable: povertyline
A negative beta coefficient means that a 1 unit positive standard deviation change in X is
expected to result in a negative beta coefficient change in Y. So if beta is, -2.399, a 1 unit
standard deviation change in poverty line is expected to result in a -2.399 standard
deviation change in financial inclusion of total population.

3.10. Barriers to financial inclusion
Identifying the barriers that prevent the lower income people in the country in
accessing to the financial services provide hints as to which policies could be supportive
in removing the barriers and broadening access. Measures for accessibility, affordability
and eligibility can indicate the extent of barriers to the financial services in terms of
deposits, loans, payments, locations, technology etc.
Poor banking infrastructure: Keeping in view the number of financially excluded

people, in Bangladesh, about half of the adult population is unbanked (48.49
percent) in terms of deposit accounts in the banks. The major barrier is
geographical or physical access measuring the average distance from household
to bank branch; however, the branches per 1,000 square kilometers could be
used as crude indicator for providing an initial idea to the barriers of inclusion.
For example, Spain has 96 branches per 100,000 people and 790 branches per
1,000 square kilometer, while Bangladesh has less than 7 branches (or ATM) per
100,000 population and about 67 branches (or ATM) per 1,000 square
kilometer. A large section of the population who do not have any physical access
to the banking services are in rural and remote areas in the country.
Lack of proper documentation: Another barrier is lack of proper documentation

including ID, proof of domicile and reference letter required to open a checking
or savings account in Bangladesh, where many people do not have such
documentation.
Inadequate financial literacy or education: Financial literacy and awareness are

very low in the country, particularly in rural areas; it makes a large segment of
household difficult to get financial services from the banking system in terms of
savings, credit and payments.
High requirement of minimum balance: Many institutions have a minimum

account balance requirement or fee for opening checking or savings account;
consequently, many lower income people faces difficulty to maintain such
balance enforcing to exclude themselves from the financial services. Though
minimum amount to open a checking or savings account (2.28 and 0.89 percent
of GDP per capita respectively) is lower in Bangladesh, it could be free for the
poor people for broadening the extent of financial inclusion.
Poor level of technological infrastructure: As a competitive and cost effective

strategy, major banks focuses on large scale of loans instead of providing
services for small size of loan; as a result, rational business decisions prevent a
major portion of people from accessing loan services including SME and

agriculture loan. Promoting technological and institutional innovations as a

means could expand the financial system access and usage; however, less than 4
people per 1,000 populations in the country are using credit cards identifying the
technological and infrastructural weaknesses.
Low income: There is still a large section of household in the country, particularly
in rural areas, having extremely low level of income; therefore, those people are
un-served from any financial institutions.
Lack of suitable product structure of banks and MFIs: Appropriate financial

products need to develop in reaching the unbanked population to the formal
financial system.
High cost of product: The cost of product of MFIs compared to that of

banks(interest rate) is still high indicating another important barrier for
financial inclusion.
Absence of credit bureau and insurance of MFI borrowers: Spreading of outreach

by MFI is quite impressive in rural areas. But, there is no credit bureau for
identifying overlapping borrowers and their indebtedness. At the same time,
there is no micro insurance for credit borrowers.
3.11. Role of Bank Asia for enhancing Financial Inclusion
Bank Asia Limited started its service with a vision to serve with modern & innovative
banking. And as part of the banks commitment to provide all modern and value added
banking service in keeping with the very best standard, bank is offering online banking
with added delivery channels like ATM, Tele-banking, SMS banking, net banking, mobile
banking and so on.
Alternative Delivery Channel currently working Mobile Banking system and Agent
Banking System of Bank Asia Limited with technological support of its sister concern
Era InfoTech Limited.

3.12. Alternative Delivery Channel
Tele Banking Call Center/ IVR
Internet Banking
Any Branch
Banking
Online Banking
EPS (Electronic
Pos, ATM Booths
Alternative Delivery Channel
Payment System)
Debit/ Credit/ ATM

Plastic/ E-money
Cards
Social Networks
USSD
Mobile Banking
SMS Banking
Smart Banking Mobile App Banking
Agent Point
Agent Banking
Home Banking
3.13. Mobile Banking
Mobile banking involves the access to, and provision of, banking and finance services
through mobile devices. In Bangladesh, Mobile banking offers a distinct alternative to
conventional branch-based banking. It leads to a different meaning that customer
conducts financial transactions at a whole range of retail agents or through mobile
phone instead of at bank branches or through bank employees. This model promises the
potential to substantially increase the financial services outreach by using a different
delivery channel (retailers/ mobile phones), a different trade partner (Telco / Chain
Store) having experience and target market distinct from traditional banks. In this way,
Banks are able to promote accessibility to formal financial services especially to the
poor and unbanked population at an affordable cost.

Mobile Banking can be delivered using following channels
SMS - The way this works is that the customer requests for information by
sending an SMS containing a service command to a pre specified number. The
bank responds with a reply SMS containing the specific information.
USSD - Unstructured Supplementary Service Data is a service that allows you to
display a menu on the users phone and enabling the user to interact with this
menu.
Edge Browsing through Standalone Mobile Application - hold out the most
promise as they are most suitable to implement complex banking transactions.
Easy to access through internet & easily customized according to the user needs.
WAP- WAP uses a concept similar to that used in Internet banking. Banks
maintain WAP sites which customer's access using a WAP compatible browser
on their mobile phones.
IVR - IVR or Interactive Voice Response service operates through pre-specified
numbers that banks advertise to their customers. Customer's make a call at the
IVR number and are usually greeted by a stored electronic message followed by a
menu of different options. Customers can choose options by pressing the
corresponding number in their keypads, and are then read out the
corresponding information, mostly using a text to speech program.
3.14 Agent Banking
Bank Asia will be starting soon its pilot project on Agent Banking as a tool of financial
inclusion of greater population of Bangladesh. The aim of this project is to connect mass
people with smart banking services. Bank Asia is trying to take the bank before the
customers door for the first time in Bangladesh. To take banking services, customers have no
need of cheques to withdraw cash. They can make their transaction by using only agent
banking card and their own finger print. Bank Asia has assured a secure agent banking to its
customer.
Agent banking can be delivered using following channels
Cards
Finger print
POS machine
Internet

Agent Banking Services
Apply for Bank Asia account and prepaid cards.

Deposit and withdraw cash
Balance inquiry
Purchase airtime and pay mobile bills
Pay Utility Bills i.e. Gas, Water, Electricity etc.
Apply for debit cards
Loan Disbursement
Account reactivation
Generation and issuance of mini bank statements
Mobile Banking registration
Money transfer services
Remittance withdraw

Chapter -4
EKTEE BARI EKTEE KHAMAR
(EBEK) An Example of Financial
Inclusion

4.1. Introduction of EBEK
Ektee Bari Ektee Khamar [EBEK] (One House One Farm) is a government project for the
poor people of Bangladesh & is a government contributory savings project for unbanked
population to alleviate poverty. Government wants to help the poor people by
encouraging saving, providing grants, Training & monitoring their activities as a group
in each village of Bangladesh. This will help to alleviate poverty of Bangladesh.
EBEK projects mobile banking solution provided for Deposit Collection, Loan
Disbursement, Government Grant Disbursement (Member & Somitee), and Loan
Repayment Collection Targeting 51 lac households. Bank Asia started to serve the
unbanked population at the village level setting up agency at the union level. Project
beneficiaries can perform all kinds of banking transaction at their union level. So far
Nine (9) districts having more than 100,000 beneficiaries are under Bank Asias
banking service network.
Ektee Bari Ektee Khamar project authority requested Bank Asia has to expand the
network within another 22 districts having about 400,000 beneficiaries within next
three months.
The same agent network could be used for other government to people transactions,
people to government transactions along with regular small amount business
transaction.
This model ensures financial inclusion fruitful to the unbanked population.
For expansion & Security enhancement Bank Asia wants to setup small administrative
offices at upazila level and provide smart card with Bio-metric option for better
authentication of all kinds of transactions.

4.1.1 Vision
The intrinsic goal of the project is to reduce national poverty to 20% from 40% by 2015
through developing each of the houses as a unit of agro economic activities by utilizing
human and financial resources of the family members. To achieve the goal the project
takes the following specific objectives with precise target and time frame to-
1. Bring all (85,000) villages of the country under Village Development Organization
(VDO) comprising 60 members for each by 2013.
2. Develop each house hold (510,000) of Bangladesh as an ideal agro farm by 2013.
3. Train up 2, 02,635 workers (5 from each village) on Agriculture, Home gardening,
Fish culture, Poultry and Livestock by 2012.
4. Establish 5 (five) exhibition farms in each village by 2015.
5. Establish agro farms in rest of the possible households of each village following the
exhibition farms by 2015.
6. Develop mutual fund for each member/beneficiary through giving incentive TK 200
per month (TK 2,400 per year) as grant by June, 2015.
7. Develop common fund for each village organization through yearly incentives Tk.
150,000 by June, 2015.
8. Develop Tk 900,000 cumulative common fund for the villagers under the title of
village development organization by June, 2015.
9. Develop marketing canters at sub-district level ensuing market facilities for the
farmer by 2015.
10. Develop food processing and cold storage facilities at sub-district level for the
producers/farmers by 2015.

4.1.2 Project Background

Nearly Eighty percent people of Bangladesh live in the villages. Land and rural people
are the key elements of rural economy. The overall development of this country
depends virtually on the development of its rural areas. All elements of the driving force
of the economy prevail in the villages. Every house in the village has unutilized land,
home yard, pond/ditch, canal, etc. It also has unskilled manpower, unemployed youths
and women. Alongside these resources different Nation Building Departments (NBDs)
have their cadres to offer extension services to the villagers. This means that we have all
elements and resources like land, labor, capital and others in our villages which, if
explored rightly and utilized optimally can contribute to community development in
particular and national development in general.
In such situation, if every homestead is developed into a farm through identifying

untapped resources around it, organizing people through village organizations, utilizing
the resources by imparting training, creating the zeal for work and initiative in every
man and woman, developing human resource and optimal utilization of resources, it is
possible to achieve the cherished goal of over-all socio economic development of the
rural people. The vision for changing every homestead in the village into a farm, of the
honorable Prime Minister Sheikh Hasina has to be translated into reality through best
utilization of local resources, knowledge and experiences of all local government
representatives and officials of all levels and their direct participation in the local level
program management.
We have different resources at the local level. The proposed project will assist to
identify and utilize these resources properly. Against this backdrop, the project has
been formulated. Honorable Prime Minister has offered the concept of One House One
Farm in order to take appropriate measures in the light of the constitutional obligations
as mentioned in Articles 7, 9, 10, 14, 15 and 16 of the constitution.
Farmers have been growing different types of vegetables in the homestead, crops in the
field, fish in the pond and they have also been rearing poultry, duck and livestock.
Whatever they produce is not sufficient to meet the local demands. In fact they produce
half of the potential yield in crop and also in other areas of production. This implies that
there is more scope to increase production of crop, fish, poultry, duck and livestock.

There is also a crucial need to increase the number of fruits and timber trees. For
implementing these activities, every village, especially every homestead offers more or
less opportunities. Every house in every village can find ample livelihood opportunities
crops by utilizing the ponds/ditches and own land. The requirement of protein can be
fulfilled by producing fish, duck, poultry and livestock. Every village can have the
canopy of fruit and wild trees, and can be illuminated by using bio-gas and solar energy.
This will make the village brisk with activity and the villagers need will be fulfilled.
People will not like to migrate or go to towns/cities for searching jobs.
The vicious circle of poverty prevails in every village of the country. In order to break
this vicious circle and improve the quality of life, people need to accumulate saving.
Later it is possible to improve the standard of living of rural people through productive
and social investment and prolonged consumption of the savings.
In case of converting savings into investment, emphasis will be laid on gathering and
transferring technologies relating to agriculture and agro-based industries. New
technologies of production will be procured and later transferred those to the
beneficiaries in order to raise production to the optimum level.
Womens contributions to development are not properly taken cognizance though they
constitute half of the countrys population. On the other hand, labor force is not
properly utilized. According to available statistics 22% households of villages are
headed by women. Under this project, measures will be taken to use women labor force
effectively. Women headed households will be supported to increase their involvement
in IGAs with a view to raising their income level.
But only increase in production is not enough for economic development. Ensuring
proper price of produced goods through developing a sustainable marketing linkage is
also essential. Otherwise people will not be encouraged to raise production.
Development of marketing facilities including cooperative based marketing system will
be strengthened or introduced at different levels and the surplus food could be exported
with the support of food processing industries. Employment will be generated through
establishment of labor intensive industries, and peoples purchasing capacity will be
raised through increasing production and ensuring proper price.

4.1.3 Project Targets
The project will be implemented in 40527 villages of 4503 Unions under 485 Upazila of
the country. The total households to be covered under this project will be 24, 31,620
and that will provide benefits to 1, 21, 58,100 members of the households/community.
4.1.4 Target Beneficiaries
In the project areas, the heads of the following categories of households will be
considered as target population to be determined based on the following criteria:
1. Poor women-headed households in the village;

2. Households having only homestead;
3. Landless people those who own land up to 0.50 acre of land including homestead
and who earn their livelihood by selling manual labor and have no regular
sources of income.
4. Small and marginal farmers having up to 2.50 acres of land including homestead.
The above sequence will be given priority in selecting beneficiaries. In case of
backward/char areas, households having land up to 4.00 acres can also be included as
project beneficiaries. However, with a view to improving the socio-economic conditions
of the poor, the landless and marginal farmers, different activities covering all aspects of
their lives will be preferentially initiated under the project.
4.1.5 Rationale
Bangladesh is one of the least developed countries in the world in terms of per capita
income and literacy rate. Bangladesh accounts for a significant portion of the worlds
poor with nearly 40% people living below the poverty line. Hence the eradication of
poverty occupies the foremost place in Bangladeshs development programs. Review of
documents and experience over the last three decades both explicit and implicit shows
that different strategies and actions were taken in the past to combat poverty in the
country. Despite all these efforts and implementation of various programs, poverty still
continues to be pervasive and overwhelming. However, there is sufficient evidences to
believe that the existing poverty cycle can be broken if the poor are allowed to have
access to resources and justice. Keeping these facts in mind the proposed project has
been undertaken to enhance the status of the rural poor.

The project will cover 40527 villages in 4503 unions under 485 Upazila of the country.
The project will enable the rural poor and the community people to find for their self-
employment opportunities with the physical and financial supports to be offered by the
project. Besides, the village organizations to be organized under the project would be
the driving force to mobilize the poor including the women. In this way the
disadvantaged and excluded groups of people including the women would be integrated
with the process of empowerment. Thus, the project will help to increase production of
all types and alleviate rural poverty.
4.2. EBEK of Bank Asia Limited
Bank Asia Limited started its service with a vision to serve with modern & innovative
banking. And as part of the banks commitment to provide all modern and value added
banking service in keeping with the very best standard, bank is offering online banking
with added delivery channels like ATM, Tele-banking, SMS banking, net banking, mobile
banking and so on.
Alternative Delivery Channel currently working EBEK Mobile Banking system of Bank
Asia Limited with technological support of its sister concern Era InfoTech Limited. Bank
Asia Limited has been working in the project in two ways providing project
management solution through ERA InfoTech and offering Banking services to the
Project up to individual beneficiary of villages nominated by the EBEK project office.
4.2.1 What is EBEK Mobile Banking system of Bank Asia?
EBEK Mobile Banking System is a Web based solution where EBEK all banking and finance
services including Somitee Creation, Member Creation, A/C Opening, Deposit collection,
Government & Member Grants payment, Loan Sanction & disbursement, Agent withdrawal
of Cash, etc have done through this solution with providing SMS alert. There are two
modules here:
EBEK Project Management Software

1. Security modules where User creation & password change, user permission &
manage as well as all other rights are given
2. Administrative modules where Zone, District, Somitee and other code setup as
well as loan sanction is done
3. Report modules where different types of MIS reports are given

Bank Asia Mobile Banking Software

1. Security modules where User creation & password change, user permission &
manage as well as all other rights are given
2. Administrative modules where correction of wrong entries, Grants
distributions, charge adjustments etc done
3. EBEK Management module where EBEK related member operation and A/C
related operation done
4. Report modules where different types of MIS reports are given
4.2.2. Structural Diagram of EBEK Mobile Banking System
4.2.3 Why Bank Asia involved in this Project?
Bank Asia could identify the needs of EBEK for project management as well as mobile
banking software to run this project efficiently. For that reason, Bank Asia delivered
project management software free of cost and till date, this software maintained by
Bank Asia through its sister concern Era InfoTech Limited as CSR activity of the Bank.
Also Bank Asia wants to provide Banking services to the door step of common people of
Bangladesh.

4.2.4. Major Stakeholders
Major Stakeholders of the project:
1. EBEK Project Administrative Part stakeholders

a. Project Head Office
Secretary
Project Director (PD)
DPDs
Chief Accountant
Programmers
b. Project District Office
DC (District Commissioner)
ADC (General)
c. Project Upazila Office
UNO (Upazila Nirbahi Officer)
2. EBEK Project Operation Implementation Part stakeholders
a. Project Head Office
Project Director (PD)
BRDB DG(Director General)
DPDs
Programmers
Assistant Programmers
b. Project District Office
DD (Deputy Director)
c. Project Upazila Office
RDO (Rural Development Officer)
Coordinator(EBEK)
Computer Operator (Accountant)
FOs (Field Organizer)
Field Officers
3. EBEK Project Beneficiaries
a. Somitee
b. Somitee Manager

c. Somitee Accountant
d. somitee Beneficiary Members specially Women
e. somitee Honorary Members
4. Bank Part Stakeholders
a. Bank Head Office
Mobile Banking unit of ADC department
b. Bank Branches
c. Bank District Level Officers
AROs (Assistant Relationship Officer)
d. Bank Agents
BRDB Office appointed Bank Agent
UISC (Union Information Service Center)
Bank appointed independent Agent

4.2.5. EBEK Project Milestone
Sl. Information Details/Amount

No.
1 No of Somitee 18,011
2 No of Member 914,235
3 No of Member(Target) 1,038,000
4 Total Member Deposit 705,968,476
5 No of Total Transaction 2,740,236
Loan Information
6 No of Loan Disbursement 146,373
7 Total Loan Disbursement 1,465,665,510
8 Total Loan Repayment 310,882,774
9 Service Charge Repayment 21,210,813
10 Principle Due 530,671,931
11 Service Charge Due 41,305,763
12 Total Due 571,890,674
Asset Information
13 No of Bank Account 18,011
14 Bank Balance 1,156,509,879
15 Loan Outstanding 1,154,782,736
16 Total Asset 2,311,292,615
Government Grants Information
17 Govt. Grants To Member 565,045,125
18 Govt. Grants To Somitee 644,393,447
19 Donation 200
***All the information are updated till October 2013.

4.2.6. Project Work Flow
Samity
Approved Samity
Apply for Account Application for Application
Opening Samity Formation for Loan
Activities:
Account
Account No &
Opening EBEK
Account Opening
Upazila
Deposit Acknowledgement Approved Copy Project Office
Approved
Loan
Document
Loan
Installment
Balance &
Transaction Approved ? NO End
Query
Receipt of All
Transactions &
Query Response Yes
Data Entry
MIS of Transactions
Server
Bank
Instruction
For Grants
Grants Disbursement
Report
EBEK Project
Head Office
EBEK Project Work Flow

4.2.7. EBEK Workflow in Existing Manual System

Step 1 : EBEK Project Start: Project Office approved & Selected this Project for two
years for 64 districts & 483 Upazilas, Four union in Each Upazila & Nine
Villages in each Union
Step 2 : Member Selection: Select 60 Member with collecting necessary identifications
in each Village in which at least 40 members are women and are also priority
for poor people.
Step 3 : Somitee Creation: Create somitee in each village with at most 60 members.
Each somitee organizes Uthan Boitak weekly/monthly in a selected day for
somitee needs.
Step 4 : somitee Management Committee & Registration: Each somitee creates a
management committee with selecting manager, Secretary, Accountants,
Honorary Members & also registers this somitee.
Step 5 : Bank Account Opening: somitee Account a Joint Account in nearby Bank
(Sonali, Krishi etc) for money management where Upazila Coordinator &
somitee Manager are Joint signatory of that account. Upazila BRDB office also
has to open a STD account for Govt. Grant fund.
Step 6 : Saving Deposit Mobilization: Each member have to Pay 200/- taka monthly as
deposit continuously up to 2 year. If a somitee has 60 member, then in one
month, deposited amount will be 12000/- & in each quarter, it will be 36000/-
Step 7 : Govt. Grant Distribution: Government quarterly distribute two types of Govt.
Grant which they found in their STD Account total 26,10000/- in somitee-
1314000/- & in member 1296000/-
i. Govt. Grant to Each somitee 36500 in each quarter & also 1000 = Total
37500 so in a financial year, Govt. Grant to somitee (revolving fund) -
150000/-
ii. Govt. Grant. To member Govt. give 600/- in each quarter for depositing
600/- in each member. If they deposit less than this amount, then Govt.
give the deposited amount and remaining amount will be return to
government account again. If a somitee has 60 member, then in each
quarter, for depositing 36000/-, Govt give 36000/- also in each somitee.
So in a financial year, it will be 144000/-.

Step 8 : Loan Processing: In Somitees Uthan Boithak, Members of somitee& manager

select person for loan with necessary loan criteria then manager form fill up
Loan paper with necessary documents and give this list to Coordinator.
Coordinator checks & verifies the documents and sends it to UNO for approval.
After approval of UNO, Manager & Coordinator sign cheque with the amount
requested and approved and give this cheque to beneficiary to collect that
money for Bank. Member Can take highest 20000/- as Loan and have to pay
within 1 year.
Step 9 : Loan repayment: After Loan taken by member, he has to pay installment of
loan as per loan agreement. He has to pay 8% service charge for Loan.
Step 10 : Record keeping and necessary Training: Each Member Manage a passbook for
record keeping. Manager & Coordinator manage ledger book for recode
keeping of each member and also coordinator have to prepare & send report
to district & project office monthly, quarterly, half yearly & yearly basis. From
project office, Somitee members also give Loan project related training to
utilize that money properly.
EBEK Mobile Banking Workflow
Step 1 : EBEK Project Start: Project Office approved & Selected online mobile banking
to Bank Asia Ltd (31 Districts), Bangladesh Commerce Bank Ltd(20 Districts)
& United Commercial Bank Ltd(2 Districts)
Step 2 : User Creation for EBEK Management System: Provide User id& Password to
UNO, RDO, and Coordinator & Computer Operator and send it Via SMS to
Users.
Step 3 : Data Entry & Member Account Opening: Coordinator, Computer Operator &
UISC have to Entry & Create 36 Somitee& 2160 member in each upazila to
start online banking. For this data entry, they will provide somitee id &
member Id via SMS. They also provide training from EBEK Project office &
Bank End.
Step 4 : Somitee& Agent Account Opening Form Distribution: After completion of
maximum data entry, Bank prepare Account Opening Form in ADC End &
Distribute 36 somitee account opening form (Institutional Form) and 3-4
agent account opening form (Individual Form) in Each upazila with

necessary document of how to prepare A/C Opening Form. They also have to
provide deadline to prepare those Form with necessary documents &
information. Also provide contact number to upazila for necessary
communication.
Step 5 : Bank Account Opening Form Collection, Correction & A/C Open: After
distribution of A/C Opening Form, Collect those by our officer/via courier.
Check those A/C Opening Form if any documents missing or any information
not correctly fill up, correct those by sending Form or via phone. Then
Labelling those A/C Opening form and Set Manager for Each Somitee Then
Check manager & Coordinator for the somitee and A/C Open from Mobile
Banking software. Then Send A/C List of Upazila through E-Mail and SMS
notification. Also Open A/C For Bank Agent and Create user id& Password of
that Agent in Mobile Banking System. Then Send Agent A/C No. & User id,
Password through SMS. Also need to open an Joint A/C in nearly bank of that
upazila to Send EFTN money for Loan purpose.
Step 6 : Cheque Preparation & Collection: For the Live operation of Mobile Banking,
upazila needs to prepare cheques of 36 somitee. For that, they first have to
collect A/C statement of those banks A/C and write last A/C Balance to
statement in cheque. Then correctly fill up all other information & signed
both by somitees Manager & Coordinator. Then Bank officials Collect that
cheque and prepare Checklist of cheques, prepare OBC Forwarding & Prepare
OBC through Branch, Then go Manual Cheque Clearing & receive DD, Then
Send DD through online Clearing, Clear fund & Distribute those funds to
Somitee. They also have to prepare a cheque if there is any money in STD A/C
as Govt. Grant in that upazila.
Step 7 : Live Opening & Operation of Mobile Banking Program : if Cheque prepare &
master role almost ready, then Bank set a Live Opening date consulting with
UNO & Coordinator, instruct coordinator to ready cheque, master role, some
small deposit money of two/three somitee, invite 36 manager, if possible
ready projector in that day. In Live opening date, Bank officials fully describe
mobile banking operation and also do live transaction and transactional SMS
to managers mobile. Also provide full software operational training to Bank
Agent & upazila EBEK officials.

Step 8 : Master Role Preparation, Collection, Entry, and Correction & Posting: Master
role are the manual financial statement where somitee need to give
breakdown to manual financial transaction as per given format. Coordinator
need to prepare those master roles along with somitee manager through
bank statement and member passbook. Then Bank official thoroughly check
those master role if any mismatch occur they correct those to coordinator,
then send it to head office for Entry & Posting. After Entry & Posting of that
master role, somitee can view those manual financial transactional amounts
in mobile banking software and ready for full operation of EBEK mobile
banking.
Step 9 : Cash Management System: When Manager provides cash as
deposit/repayment to Bank Agent or When Bank Agent need to provide Loan
Amount to beneficiary; they need some Cash management system for smooth
operation.
a. If Bank Agent have available amount in Agent A/C, They receive Cash
from manager & provide deposit slip with properly signed then posted
those amount to somitee. Instantly SMS send to depositors mobile.
b. If Bank Agent have not available amount in Agent A/C but they have to
process loan of some somitee, then first process loan then amount
available in Agent A/C, then receive cash & provide deposit slip with
properly signed then posted those amount to somitee. Instantly SMS send
to depositors mobile. Then provide those cash to beneficiaries of those
somitee when need Loan.
c. If Bank Agent have not available amount in Agent A/C and also no loan to
process, then either Bank Agent Deposit those money to 1) Bank Asia
Branch 2) Send money through TT 3) Send money through EFTN 4)
Provide Cash to Bank Asia officials
d. If Bank Agent has not available cash to provide loan to beneficiary then
Agent have to request those money to Bank through withdraw request
and Bank Sent those money through EFTN to Agent another personal A/C
which they opened in nearly bank of those upazila.
Step 10 : Saving Deposit Mobilization: Each member have to Pay 200/- taka monthly as
deposit continuously up to 2 year. If a somitee has 60 member, then in one

month, deposited amount will be 12000/- & in each quarter, it will be

36000/-. For Each Deposit, Member received a SMS confirmation in his
mobile for depositing in his mobile account.
Necessary Debit/ Credit for Deposit:
When Manager Deposit Cash to Bank Agent then

Debit- Agent Cash Account Credit- Agent Bank A/C
When Bank Agent Give Posting of Deposit to software then

Debit- Agent Bank A/C Credit- Somitee A/C
Step 11 : Govt. Grant Distribution: Government quarterly distribute two types of Govt.
Grant total 26,10,000/- in somitee-13,14,000/- & in member 12,96,000/-
providing Bank Asia Limited an instruction. When Bank Asia provides those
Grants, an SMS notification send to Coordinators & managers mobile to
inform them of those grants.
a. Govt. Grant to Each Somitee 36500 in each quarter & also 1000 = Total
37500 so in a financial year, Govt. Grant to Somitee (revolving fund) -
150000/-
b. Govt. Grant to member Govt. give 600/- in each quarter for depositing
600/- in each member. If they deposit less than this amount, then Govt.
give the deposited amount and remaining amount will be return to
government account again. If a somitee has 60 member, then in each
quarter, for depositing 36000/-, Govt give 36000/- also in each somitee.
So in a financial year, it will be 144000/-.
Step 12 : Loan Processing: In Somitees Uthan Boithak, Members of somitee& manager
select person for loan with necessary loan criteria then manager form fill up
Loan paper with necessary documents and give this list to Coordinator.
Coordinator checks & Login to www.ebek.hostzi.com website & Entry the
information to create Loan to online system and go with document to UNO
for approval. UNO Login to system and approve/reject loan in online system
checking with the document. After approval of UNO, Manager got a SMS
notification about his Loan & Coordinator print loan document paper from
software & sends it to Bank Agent. Bank Agent process loan with necessary

loan id & PIN code which send to beneficiarys mobile number through SMS
and give money to beneficiary.
Necessary Debit/ Credit for Loan:
When Bank Agent process Loan then

Debit- Somitee A/C Credit- Agent Bank A/C
When Bank Agent Request for Withdrawal money to software then

Debit- Agent Bank A/C Credit- Bank Agent Personal A/C
Debit- Bank Agent Personal A/C Credit- Agent Cash and distribute
money to beneficiary
Step 13 : Loan repayment: After Loan taken by member, he has to pay installment of
loan as per loan agreement. He has to pay 8% service charge for Loan. If it is
adjusted earlier, then need to payment only the service charge up to that
month. This entry also notify through SMS to beneficiaries.
Necessary Debit/ Credit for Deposit:
When Manager Deposit instalment amount as Cash to Bank Agent then

Debit- Agent Cash Account Credit- Agent Bank A/C
When Bank Agent Give Posting of Loan Instalment to software then

Debit- Agent Bank A/C Credit- Somitee A/C
Step 14 : Necessary Reports & Statements: After operation start, need to view
necessary reports & statements in both EBEK upazila office & Bank Asia
Mobile Banking System for Bank Agent.
Step 15 : Post Live Operation : After completing the necessary operation & training,
bank officials need to support upazila EBEK office & Bank Agent daily basis as
per their need and help them to do post live operation smoothly.
4.2.8. Process of Account Opening

To open an Account at EBEK fast of all we have to fill up an Account Opening form. We
have two types of Account Opening form:
1) Institutional Account Opening Form

2) Individual Account Opening Form

4.2.9. Process to fill up Institutional Account Opening Form
1. Take a Institutional Account Opening form,

2. Write the Somitee name in the front page,
3. Attach a signatory card at 2nd page of the form and fill through;
a. A/C Title: Wright the Somitee Name
b. Take two signatures accordingly from both of Manager of the Somitee and
Coordinator, Wright their name and Customer ID and fixed their Photograph at
specific place (Total 2 X 2 Photograph are required).
4. Account Opening Form-Institutional Account : At the Third page we have to attach
one photograph of each Manager and Coordinator and then fill up according the
serial no;
5. At the Forth page serial no. 19. Declaration & Signature, there are some option for
three Signatures with Name, Designation and date of Somitee Manager, Coordinator
and UNO of that Union.
6. Personal Information: This is the Fifth page and before fill up we have to make a copy
of this page for Somitee Managers Personal Information and Coordinators Personal
Information according the serial No.
7. Transaction Profile: This is the Sixth page and Both Manager and Coordinator have
to place their Signature with Seal at the end of this page.
8. Terms and conditions for operation of account with Bank Asia Limited: This is the
Tenth page of the form and Both Manager and Coordinator Should place their
Signature with Seal at the end of this page.
Here is the end of Manual process of an Account Opening.

Now we can input these data into the system through EBEK, which process are as
follows:
a) Fast of all we have to open our EBEK ID.

b) Then type 001 at Select Somitee and press Expand All button.
c) Then go to the Administrative Module for EBEK
d) Select Create Somitee
e) Now select the Division Code, District Code, Upazila Code and Union Code then
type the Serial No. such as 01, 02 03 etc. i.e. minimum two ward have to type.
(We know that there are nine somitee under every union, so Serial No. might be
01-09 and satires paribus)
f) Somitee type : Exist in Manual System
g) Village Name : Type the village name of the somitee
h) Somitee Name : Type The Name of the Somitee
i) Address : Type the Somitee Address
j) Somitee Mobile No. Type the Managers Mobile Number
k) Somitee Open Date : Auto
l) Coordinator ID: Select the arrow and select the name of the coordinator.
m) Now press the Create Button.
n) After creating somitee we note down the Somitee Code on the top of the Account
Opening Form.
After Creating Somitee we take the List through the following way:
1. Then type 001 at Select Somitee and press Expand All button.
2. Then go to the Report
3. Then Select Zone Wise Village List
4. Now select the Division Code, District Code, Upazila Code and Union Code then
Press the Submit Button.
5. To gat whole list Press Action Button, select Rows per page and select All
6. Now we can convert this page into Excel format and take a print.

Now coordinator and computer operator both can input the data of the somitee
members accordingly which process are as bellow:
1. To input sixty members data fast of all we have to type the somitee code at Select
Somitee then press Expand All
2. Now go to the EBEK Management
3. Then select Member Information Entry
Coordinator input his/her information by selecting Add Coordinator Information then
Type Name ; Father Name; Mother Name; Mobile No.; Present Address; Permanent
Address; Coordinators Upazila and Coordinators Upazila and then press Create Button.
After the previous all process we can open an account for somitee through the following
process:
1. Select Manager and Coordinator for every Somitee of a Upazila.

2. Then we Open our Bank Asia Mobile Banking ID
3. Then type 001 at Select Somitee and press Expand All button.
4. Then go to Administrative Module for EBEK
5. Then select Somitee Account Open in Core Bank
6. Now Select District Code; Upazila Code; Union Code and Somitee Code and then
select Submit Button.
7. Thats how we can get all account number of All somitee of an specific Union.

4.2.10. Process to fill up Individual Account Opening Form
1. Take a Individual Account Opening form,

2. Write the name of both Agent in the front page,
3. Attach a signatory card at 2nd page of the form and fill through;
a. A/C Title: Write the name of both Agent.
b. Take two signatures accordingly from Both Agent, Wright their name and
Customer ID and fixed their Photograph at specific place (Total 2 X 3
Photograph are required).
4. Account Opening Form-Individual Account : At the Third page we have to attach
one photograph of each Agent and then fill up according the serial no;
5. Personal Information: This is the Sixth page and before fill up we have to make a
copy of this page for another Agents Personal Information and Coordinators
Personal Information.
6. Finally a Signature with Seal have to give by them at their individual page end
and both page have to attach carefully.
7. Transaction Profile: This is the seventh page of the form; here we have to take
both Agents Signature with details.
8. Here we added an extra page named Bank Asia Limited Mobile Banking
Department We have to attach a photograph of each Agent and fill up their
details and the next page they should place their Signature and Mr. UNO will
identify them.
9. Terms and conditions for operation of account with Bank Asia Limited: This is the
Last page of the form and Both Agent should place their Signature with Seal at
the end of this page.
10. After the above process we can proceed for data entry to the system to open the
Agent Account.

Chapter -5
My work experience

5.1 My work experience at Bank Asia Ltd (ADC department)
As an intern I had started my internship program at Bank Asia Ltd. ADC Department from 4th
August 2013. I had worked in different wings. My supervisor at the office was Md. Kamrul
Islam (Executive Officer). During my internship program I have performed many duties as
assigned by my Supervisor. . This has enriched my practical knowledge and also has given
me a corporate exposure. The descriptions of my duties are given below:
Institutional and Individual Account Opening Form preparing & filling

During my Internship at first I have learned how to prepare and fill up the account opening
form of different somitees and individual account. Institutional accounts are opened only for
the particular project. After expiring the project those accounts will be closed.
Manager Selection and Account Opening

During my Internship I was assigned to work at Ektee Bari Ektee Khamar (EBEK) project.
This project is running successfully all over the country by Bank Asia Ltd. In this project, I
had to check account opening form of manager for different Somitee and open the Accounts.
And send emails to the Assistant Relationship Officer (ARO), URDO and UCO. After open
the account I had to store the Account opening form by district wise.
Master Role Entry & checking

During my tenure at Bank Asia Ltd. I was assigned to entry the master role. Master role is the
financial summary which is given to Bank Asia from different somitee. After entry the master
role in the EBEK software, I had to check the master role.
Somitee Balance Correction

One of the vital tasks as assigned by my Supervisor was somitee balance correction. If there
exists any mismatch between any somitees balance and stellar balance then after taking
proper action, I have to correct the balance of that Somitee.

Rearranging Member Deposit

Before running government grant to a particular somitee, deposits collected from somitee
members should be arranged sequentially into amount of tk 200 per month. One member gets
tk 200 only against his/her deposited amount tk 200 per month. If any member deposit tk 400
in a month he/she will not get tk 400 against his/her deposited amount, he/she will get only tk
200. So for ensuring their proper achievement of government grant I have to rearrange the
deposited amount of somitee members into tk 200 sequentially per month.
Agent Banking Format
Recently Bank Asia has aimed to start agent banking service with a view to providing
banking service to the mass people of Bangladesh. Where there is no branch of bank or from
where it is not possible to get banking services easily. The main objective of agent banking is
to make available banking services to all types of customers living in remote areas. Agent
banking will cover all the villages of our country.
Already Bank Asia has started a pilot program of this project. I have got a good opportunity
to work with this project from the very beginning of this project. I have prepared a model of
probable agent banking services and financial model.

Chapter -6
Recommendations
And
Conclusion

6.1. Findings
During my internship period in the Bank Asia Limited, I have got the opportunity to work
with Different Banking Delivery Channel and I observed many things. With those
observations, description as well as analysis of the topic, I find some factors. Those are given
below:
1. I have found a better and friendly working environment in Alternative Delivery

Channel Department.
2. ADC Department of Bank Asia mainly works with most advanced technologies used
in banking services. There is a scope of huge learning about electronic and online
banking activities as ADC department is mainly focusing on it.
3. Bank Asia can impose a good impact in reduction of poverty. By extending their
agent banking project, they can easily include more people under the umbrella of
financial services.
4. Bank Asia user an operating software STELLER as their core banking software.
The same software is used by Brac Bank in Bangladesh. But I have found that this
software has got problems and hampers working attention and also delayed time.
5. Sometimes they find problems in receiving courier of master role and new account
form of EBEK project.
6. Process of rearranging member deposits of EBEK project through Bank Asia Mobile
Banking is so lengthy that it has to do one month by one month.
7. Financial inclusion is a challenging job in Bangladesh. But it can change the present
scenario dramatically. From my study, I have found that if Bank Asia is able to
include 2.19% of total population of Bangladesh the poverty line will be decline 1%
in average.

6.2. Recommendations
Smart technologies such as Social Networks and Apps can be used to provide
smart banking services, so new generation adults will be attracted to get financial
services through smart technologies.
Bank Asia should concentrate on latest secure modules or channels such as agent
banking to include more people under the umbrella of financial services.
Bank Asia ADC department is well decorated and also have a talented pool of
employees but there is no doubt that there is a shortage of employees in ADC
department.
Bank should put more concentration about all categories client.
Since STELLER is the core banking software of Bank Asia, they should be
improved or maintained the version of this software. Because It will save time and
make the banking operation smooth.
ADC department must have a regular person in the front desk who will receive the
courier and who can give the right information to the other messenger.
Resources are not available as per amount of employees here. So department have
to do something for the proper availability of resources.
These are all about the recommendation provided based on survey and my personal
experiences of internship in Bank Asia Ltd. By following these recommendations Bank Asia
would be able to build up a strong platform of satisfied customers.
6.3. Conclusion
Certainly, there are many reasons to believe that financial inclusion can support financial
stability. In order to play this supporting role, however, Bank Asia has to choose the right
kind of financial inclusion. By its very nature, financial inclusion is bringing in people who
have no track record in the use of formal financial services. They have no formal credit
history, may be unfamiliar with filling out forms, and may lack proper identification.
Accordingly, products must be tailored carefully to their needs, at a reasonable cost, and they
cannot be "overloaded" with financial services that they do not need or want. In some cases,
financial literacy education may be required, so that the tools they are provided can be used
properly.
But if these conditions are met, financial inclusion can open up worlds of opportunity for
those who were previously excluded, expanding the customer base for a whole range of
financial products, and in so doing contribute mightily to a vibrant - and stable - financial
sector.

References
Demirguc-kunt, Asli, Levine and Ross, Finance and Inequality: Theory and Evidence, 2009.
Klapper and Demirguc-Kunt, Measuring Financial Inclusion: The Global Findex Database, World Bank
Policy
Research Paper 6025, 2012.
AKM Mahtab Hossain, Department of Computer Science and Information Management, School of
Advanced Technologies, AIT, Thailand and Conditions (10/2005). ANZ Bank, Internet, Phone, ATM and
EFTPOS Banking Your Guide (10/2005).
GuangyingHua, (April 2009), Internet Banking and Commerce, Journal of internet banking, vol. 14, no.1
(http://www.arraydev.com/commerce/jibc/2009-04/Online%20Banking_GHua.pdf)
Vijay M. Kumbhar, M. A. SET, NET, GDC&A, DIT and M. Phil (Economics), International Journal of Business
and Management Tomorrow Vol. 1 No. 1 , Alternative Banking Channels and Customers Satisfaction: An
Empirical Study of Public and Private Sector Banks
Websites:
http://www.infosys.com/finacle/solutions/thought-papers/Documents/role-alternate-channels.pdf
http://www.tefen.com/fileadmin/editorial/Best_of_Tefen/Banking.pdf
http://www.svtuition.org/2011/05/alternate-banking-delivery-channels.html
http://www.avanzasolutions.com/Techronicle/alternate-delivery-channels
http://data.worldbank.org/indicator/SI.POV.NAHC/countries/BD?display=graph
Internship Report
Intership Report on AB Bank Online Banking
Intership Report on e-banking of HSBC
Internship Report on Performance of Dutch Bangla Bank Limited in Online Banking.

Bibliography
Md. Ibrahim Khalil, Iqbal Ahmad, and Md. Delwar Hossain Khan, Internet Banking: Development and
Prospects in Bangladesh,
Rudolph Strong, University of Wisconsin Stout, strongr6116@my.uwstout.edu , ICT BANKING STRATEGIES

DESIGNED TO GROW AND RETAIN E-COMMERCE: ALTERNATE DELIVERY CHANNELS CUSTOMER BASE
Issues in Information Systems (Volume XII, No. 1, pp. 1-6, 201)
World Savings Bank Institute (WSBI) & European Savings Banks Group (ESBG).(2011). Corporate
Governance and Access to Finance, Perspectives 62.Retrieved on 15.08.2011 from www.wsbi.org
Rahman, A. (2009a). Financial inclusion as a tool for combating poverty the Bangladesh approach. A
keynote address in 1 AFI Global Policy Forum. Nairobi.
Rahman, A. (2009b). Financial inclusion as tools for combating poverty; Joesph Mubiru Lecture.
Bangladesh Bank Quarterly, Vol. VII, No. 2.
Sarma, M., and Pais, J. (2011). Financing inclusion and development. Journal of International
Development. 23, 613-628.
UN: United Nations (2006), Building inclusive financial sectors for development. New York: The United
Nations Department of Public Information.

Acronyms
Elaboration
AB Agent Banking
ADC Alternative Delivery Channel
ATM Automated Teller Machine
BB Bangladesh Bank
BAL Bank Asia Limited
CFI Center for Financial Inclusion
CSR Corporate Social Responsibility
EBEK Ekti Bari Ekti Khamar( One House One Farm)
EPS Electronic Payment System
FI Financial Inclusion/ Financial Institution
FE Financial Exclusion
InM Institute of Microfinance
MCB Muslim Commercial Bank Ltd.
MDGs Millennium Development Goals
MFIs Microfinance institutions
MRA Microcredit Regulatory Authority
NBDs Nation Building Departments
PD Project Director
POS Point of Sales
SFI Sustainable Financial Inclusion

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Internship Report

Sustainable Financial Inclusion and Poverty Alleviation

Date of Submission: 30 October, 2013.

Under the Supervision of

Md. Sogir Hossain Khandoker

Md. Mazharul Islam

Department of Finance Jagannath University, Dhaka

Md. Sogir Hossain Khandoker

Subject: Submission of Internship Report

The internship program was very much valuable to me as it helped me to gain

Department of Finance Jagannath University, Dhaka i|Page

He is wished all the best in his effort.

Department of Finance Jagannath University, Dhaka ii | P a g e

Department of Finance Jagannath University, Dhaka iii | P a g e

Financial inclusion is alternatively known as inclusive financing which attempts to

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Department of Finance Jagannath University, Dhaka v|Page

Department of Finance Jagannath University, Dhaka

3.10 Role of Bank Asia for enhancing Financial

Department of Finance Jagannath University, Dhaka

Department of Finance Jagannath University, Dhaka 1|Page

(Keyword: Financial Inclusion, Smart Banking, ADC, EBEK, Poverty Alleviation)

1.1 Introduction to the Study

If economic development should ultimately result in individual freedom, the contribution of

Department of Finance Jagannath University, Dhaka 2|Page

1.1.2 Review of Literature

1.1.3 Rationale of the Study

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1.2. Objectives of the Study

The objective of the study may be viewed as:

1.2.2 Specific Objectives

To analyze the performance of Bank Asia Limited.

1.3. Research Methodology

Department of Finance Jagannath University, Dhaka 4|Page

1.3.1 Primary Sources of data

The primary data of this report were collected through:

1.3.2 Secondary Sources of data

I have gathered the secondary data via following sources:

Texts regarding Electronic Banking.

Alternative Delivery Channel Of Bank Asia

Primary Data Secondary Data

Problem Findings and

Department of Finance Jagannath University, Dhaka 5|Page

1.4. Data Analysis & Presentation Technique

In preparing this report, many obstacles came in my path. These are:

Department of Finance Jagannath University, Dhaka 6|Page

Department of Finance Jagannath University, Dhaka 7|Page

2.1. Background of Bank Asia Limited

Bank Asia Limited is maintaining its competitiveness by leveraging on its Online

Bank Asia Limited has successfully established a transparent process of recruitment

Department of Finance Jagannath University, Dhaka 8|Page

2.1.1. Vision, Mission & Core Values

FOR A BETTER TOMORROW

Bank Asia's vision is to have a poverty free Bangladesh in course of a generation in

To assist in bringing high quality service to our customers and to participate in

Department of Finance Jagannath University, Dhaka 9|Page

2.1.2. Salient Features of Bank Asia

Only Bangladeshi Bank to acquire (Purchase) operations of 02 (two) foreign

Commercial Banks rated in this category is adjudged to be very strong banks,

Department of Finance Jagannath University, Dhaka 10 | P a g e

2.1.3 Products & Services

Overdraft, Secured Overdraft, Secured OD (Earnest Money), Working capital finance,