Types of bank

A single institution can’t fulfill all the services demanded by the customers. So, different types of banks emerged in the banking industry concentrating on a special sector. On the basis of their specialized function bank can be classified as under,

Commercial Bank :

A commercial bank is a financial institution which collects saving from many persons and institutions and provides credit or loan facility to different industrial and commercial business. Commercial banking business consists of changing cash into bank deposit and bank deposit into cash, transferring bank deposit form one person or institution to other, giving bank deposit in exchange for cheques, bills of exchange, government securities etc.

                      

Nepal bank limited established in 1994 BS is the first commercial bank in Nepal. Commercial banks perform various functions. Among them accepting various types of deposit is the main function of commercial banks.

In brief commercials bank performs:

·        Accepting various types of deposits,

·        Lending money in various production sectors,

·        Letter of credit i.e. credit creation,

·        Issue of Guarantee,

·        Money remittance,

·        Bills acceptance and payment others

     Central Bank:      

        

Central bank is the bank of government of any country. It acts as a guardian of all banking institution. It is set up to make sound monetary policy. Its focus is on monetary stability. It controls banking sector by regulation, persuasion and market operation.

Bank of England-1964 is the first central bank of the world. Nepal Rastra Bank is the first central bank of Nepal established in 2031 B.S. In brief, central bank performs:-

·        Note issue.

·        Regulation, control and supervision of banking sectors.

·        Acting as a Government bank.

·        Clearing house function.

·        Credit control function.

·        Lender to the last resort.

·        Publication of monetary and financial information.

      Development Bank:

Development bank on its meaning is established for development of certain sector they collects funds from share capital debentures , long term deposits  refinance from central bank. Generally development bank aims to develop – (i) Infra structure development of country. (ii) Agricultural development of country. NIDC (Nepal industrial development corporation 2018 B.S.) and ADB (Agriculture Development Bank 2024 B.S.) are development banks of Nepal.

        Saving Bank:

Saving bank objects to mobilized the small scattered savings and promote saving of small groups to save something out of their income. So, saving bank doesn’t collect / accept huge amount from business houses. Higher interest rates are offered on such savings. In Nepal Hulak Bachat Bank (post saving bank) was set up in 2019 B.S. to encourage the thrift.

    EXIM Bank (Export & Import Bank) :

These banks deal in foreign exchange and specialize foreign trade and supply the necessary foreign exchange requires for settlement of transaction between traders. They open letter of credits, Guarantees in foreign currencies. They make finance for export and import transaction. Commercial banks perform such function in Nepal.

F)     Other Banks:

a.         Co-operative bank:-

Those banks that operate on the principle of cooperation are co-operative bank. They collect small deposit and mobilize small savings. They also provide short and medium term loan.

b.         Housing Bank:-

House bank collects deposit and finance in the development of houses. They purchase and sell securities in the market also.

c.          Merchant Bank:-

Merchant bank’s main source of capital are the time deposit and by the issue of securities. Nepal Sri Lanka merchant bank is an example of merchant bank.

Origin and development of bank in Nepal

The ancient bankers of Nepal were like other countries goldsmith, merchants and money lenders. In 1993 B.S. Prime Minister Ranoddip Singh established Tejarath Adda which was the first step towards the institutional development of banking in Nepal. Tejarath Adda didn’t collect deposit from the public but gave loans to the employees and public against the bullion.

Banking in modern sense in Nepal stared with the inception of Nepal Bank Limited on B.S. 1994 with paid up capital of Rs.85000. Nepal Bank Limited had prodigious responsibility of attracting people towards banking sectors for pre-dominant money lenders net and expanding banking services. Being a commercial bank, it was natural that NBL paid more attention to profit generating business and stated opening branches at urban centers.

Government however had responsibility of stretching banking services to the nooks and corners of the country and also managing financial system in proper way. Nepal Rastra Bank (NRB) was set up on B.S.2013/01/14 as a central bank under NRB Act 2010. Since then, it has been functioning as the government’s bank and has contributed to the growth of financial sector.

Importance Of Banks

Capital is the most essential factor for the development of any country. Bank is vital to develop and spread industries to boost the trade and commerce activities and for international trade. Banks are among the most important financial institution and essential business in different parts to the town and cities. Bank is financial organization with an aim to accumulate the idle money of the general public and advancing to their profit sector. In order to collect money from general public, banks offer attractive rate of return for saving. Bank then mobilizes their deposit in providing loan facility to the general public, business houses, industries agriculture and other needy sectors on attractive interest rate. In this way, the main objective of the bank is to mobilize idle resources in a productive area after collecting from different scattered sources.                                              

A bank through its operation acts as a mediator between the savers and investors and generates profits for self-existence. The bank will generate their income from different ways. They acquire funds from one group of surplus spending unit and make these funds available to other deficit unit.

They make profit by paying low rate to the savers and charging high rate to the borrowers. Bank also generates income by providing other services for which they charge fees and commission, such services includes  trust administration, safety deposits, LC(letter of credit), credit cards etc. meanwhile bank have also entered into a financial advisory services, foreign trading, processing and investment.

There is no unanimity about the origin of the world banking. Different people have different views about its origin. The term bank was originated from Italian word “Banco” which means bench in which the banks will deeps its money and its records. Some of the opinions trace that it was originated from the French word “Banque”.

Banking Customer Service Responsibilities and Duties

A customer service representative interacts with a company’s customers to provide them with information to address inquiries regarding products and services. In addition, they deal with and help resolve any customer complaints. For instance, a customer representative may assist you in opening an account or help you to resolve a problem if you cannot access your account or if your order never arrived. Usually, customer service representatives gather their information via a telephone call.

·         Answer participant questions, as well as question participants to obtain full understanding of what information is being requested.

·         Analyze customer needs and demand and try to fulfill those demands.

·         Deliver qualitative services to customers.

·         Promote bank products and services.

·         Build customer relationships.

·         Maintain and manage existing accounts.

·         Capture new accounts.

·         Respond to customer inquiries and resolve.

·         Maintain customer database and update periodically.

·         Assist customers in depositing and withdrawing cash.

·         Refer complex issues to the management.

·         Ensure best practices in rendering services to customers.