Assignment Point



Thesis Report

On

Overall E Banking of Dutch Bangla Bank Limited

Submitted by

WWW.

As a part of my under graduation program, I have completed my theses report in a renowned financial institution named “Dutch-Bangla Bank Limited.” Throughout the period of my theses report, I had been working in several departments. I prepared this report concentrating on the Electronic Banking activities of Dutch-Bangla Bank Limited. The report will reveal the background of the company, description of the Electronics Banking activities of DBBL, findings and recommendations based on the experience gathered.

1.1 RATIONALE OF THE STUDY

To a country banking services for modernized technology should be emphasized. But unfortunately a very few studies has been made for Banking services for electronic banking sector compare with other sectors although the contribution of Bank to e-banking service is increasing in our economy day by day. A bank being a dealer of others financial institutions has to repay the money of the depositor with or without Interest when demanded. It has to earn a portion of its profit by providing e banking services. This report will surely help to get valuable knowledge about e banking services and its procedures, all the documentation needed for e banking will provide more benefit from DBBL in comparison with foreign banks, local banks and nationalized banks of Bangladesh

1.2 OBJECTIVE OF THE STUDY

There are two main objectives behind this report. The Primary Objective of the study is to fulfil the partial requirement of the BBA program. In the final semester of our BBA program one theses report is to be submitted. An oral viva will be held on this report.

The secondary objectives of the study are to provide:

i. To get a broader overview of Electronic Banking,

ii. Importance of E-Banking Activities from an organizational perspective,

iii. To identify the activities served by Dutch-bangle bank to perform the “Electronic Banking Activities”.

iv. To know the types of services which DBBL provides electronically.

v. To learn the operations of ATM machine.

vi. To learn the basic requirement of the bank for providing e-banking facilities for the customers

1.3 SCOPE OF THE STUDY

The report consists of mainly four broad parts like- The Organizational part, the activities of the bank regarding e-banking, Analysis part& the survey part The Organization part includes a description of Dutch-Bangla Bank Limited, its background, history, description of different activities performed by Dutch-Bangla Bank under the head of E-Banking Activities and summarizing the total contribution to perform those activities. Also, problem identification regarding E-Banking of DBBL and my recommendations has been mentioned in this report.

1.4 METHODOLOGY

In order to make the study more meaningful and presentable, two sources of data and information will be used widely. The sources of data are as follows-

The Primary Sources:

• Face-to-face conversation with the respective officials& clients.

• Informal conversation as well as a direct interview with officials of DBBL

• Relevant file study as provided by the officers concerned.

The Secondary Sources:

• Annual report and periodical publications

• Different publications, Newspapers and Journals.

• The internet will also be used as a theoretical source of information

The activities performed under “Electronic Banking Activities” were identified through informal interviews with the officials and from different publications.

1.5: LIMITATIONS OF THE STUDY

The following limitations are apparent in the report—

➢ The main Limitation of this report is that it’s not possible to disclose all data and information for the reason of confidentiality.

➢ The bank’s employees were very much busy in banking hour. So it was very difficult to have them for equitable long time.

➢ In some cases they could not able to providing me about my topics related data for preparing a more depth research study.

➢ I carried out such a study for the first time, so inexperienced is one of the main constraints of the study.

2.0 INTRODUCTION

All over the world, the dimension of Banking has been changing rapidly due to Deregulation, Technological innovation and Globalization. Banking in Bangladesh has to keep pace with the global change. Now Banks must compete both as local institution and foreign one.

The declaration of the Government's bold and far-sighted decisions to allow banks in the private sectors to play its due role in the economy of Bangladesh, have started the process of creating new and dynamic financial institutions. One such institution is the Dutch-Bangla Bank Ltd. (DBBL). At present; the emergence of Dutch-Bangla Bank Ltd. is an important event in the private banking arena of Bangladesh.

2.1 BACKGROUND OF DBBL

Dutch-Bangla Bank Limited is a scheduled commercial bank. The Bank was established under the Bank Companies Act 1991 and incorporated as a public limited company under the Companies Act 1994 in Bangladesh with the primary objective to carry on all kinds of banking business in Bangladesh. The Bank is listed with Dhaka Stock Exchange Limited and Chittagong Stock Exchange Limited. DBBL- a Bangladesh European private joint venture scheduled commercial bank commenced formal operation from June 3, 1996. The head office of the Bank is located at Senakalyan Bhaban (4th, 5th and 6th floor), 195, Motijheel C/A, Dhaka, Bangladesh. The Bank commenced its banking business with one branch on 4 July 1996.

Dutch Bangla Bank Limited (DBBL) is a public limited company by shares, incorporated in Bangladesh in the year 1995 under companies Act 1994. With 30% equity holding, the Netherlands Development Finance company (FMO) of the Netherlands is the international co-sponsor of the Bank. Out of the rest 70%, 60% equity has been provided by prominent local entrepreneurs and industrialists & the rest 10% shares is the public issue. During the initial operating year (1996-1997) the bank received skill augmentation technical assistance from ABN Amro Bank of the Netherlands.

DBBL’s focus is to provide one counter service to clients covering: Commercial Banking (Deposit Accounts), Consumer Banking (Retail Baking) - Traveler Cheques- Foreign & Inland Remittances, Financial Services, Corporate Banking, Asset & liability management, Liquidity & capital Resources Management, Information technology, Human Resources.

DBBL Internet banking enables customer to access his/her personal or business accounts anytime anywhere from home, office or when traveling. Internet Banking gives customer the freedom to choose his/her own banking hours. It can save time, money and effort. It's fast, easy, secure and best of all.

Dutch-Bangla Bank Ltd. came into existence with joint venture as a public limited company incorporated in Bangladesh on June 26, 1995 with the primary objectives to carry on all kinds of banking business in and outside of Bangladesh. DBBL has started its business with foreign bank. DBBL commenced its business as scheduled bank with effect from July 04, 1995 with one branch-Motijheel Branch, Dhaka, with a motto to grow as a leader in the banking arena of Bangladesh through better counseling and effect service to clients and thus to revitalize the economy of the country. All the branches are currently providing truly On-Line banking facility. DBBL resumed its operational activities initially with an authorized capital of Tk.400 million and paid up capital of Tk.202.14 million.

2.2. MISSION, VISION AND OBJECTIVE OF DBBL

❖ Mission

Dutch Bangla Bank engineers enterprise and creativity in business and industry with a commitment to social responsibility.” PROFIT ALONE” does not hold a central focus in the bank’s operation; because “man does not live by brain and butter alone “.

❖ Vision

“To become a leading banking institution and play a pivotal role in the development of the country”

DUTCH BANGLA BANK dreams of better Bangladesh, where arts and letters, sports and athletics, music and entertainment, science and education, health and hygiene, clean and pollution free environment and above all a society based on morality and ethics make all our lives worth living. DBBL’s essence and ethos rest on a cosmos of creativity and the marvel magic of a charm life that abounds with sprit of life and adventures that contributes towards human development.

❖ Core Objectives

Dutch-Bangla Bank believes in its uncompromising commitment to fulfill its customer needs and satisfaction and to become their first choice in banking. Taking cue from its pool esteemed clientele, Dutch-Bangla Bank intends to pave the way for a new era in banking that uphold and epitomize its vaunted marques “Your Trusted Partner”.

• To establish relationship banking and improve service quality through development of Strategic Marketing Plans.

• To remain one of the best banks in Bangladesh in terms of profitability and assets quality.

• To introduce fully automated systems through integration of information technology.

• To ensure an adequate rate of return on investment

• To keep risk position at an acceptable range (including any off balance sheet risk)

2.3 PRODUCT AND SERVICES OF DBBL

1 2.3.1 Products and services offered by DBBL

➢ Retail Banking

➢ Remittance and collection

➢ Import and export handling and financing

➢ Corporate Banking

➢ Project Finance

➢ Investment Banking

➢ Consumer credit

➢ Agriculture Loan

➢ Real time any branch banking

➢ 24 Hours Banking through ATM

o DBBL-NEXUS ATM & Debit card

o DBBL-Maestro/Cirrus ATM & Debit card

o DBBL Credit card

➢ Internet Banking

➢ SMS Banking

➢ On line Banking through all Branches

2

3 2.3.2 Banking Products

➢ Savings Deposit Account

➢ Current Deposit Account

➢ Short Term Deposit Account

➢ Resident Foreign Currency Deposit

➢ Foreign Currency Deposit

➢ Convertible Taka Account

➢ Non-Convertible Taka Account

➢ Exporter's FC Deposit(FBPAR)

➢ Current Deposit Account-Bank

➢ Short Term Deposit Account-Bank

4 2.3.3 Loan & Advances

➢ Loan against Trust Receipt

➢ Transport Loan

➢ Consumer Credit Scheme

➢ Real Estate Loan (Res. & Comm.)

➢ Loan Against Accepted Bill

➢ Industrial Term Loan

➢ Agricultural Term Loan

➢ Lease Finance

➢ Other Term Loan

➢ FMO Local currency Loan for SME

➢ FMO Foreign currency Loan

➢ Cash Credit (Hypothecation)

➢ Small Shop Financing Scheme

5 2.3.4 Foreign Trade

DBBL extends finance to the importers in the form of:

➢ Opening of L/C (Foreign/Local)

➢ Credit against Trust Receipt for retirement of import bills.

➢ Short term & medium term loans for installation of imported

Import Finance

DBBL extends finance to the importers in the form of:

1. Opening of L/C

2. Credit against Trust Receipt for retirement of import bills.

Export Finance

1. Pre-Shipment Finance

Pre-Shipment finance in the form of:

I) Opening of Back-to-Back L/C

II) Export Cash Credit

2. Post-Shipment Finance

Post-Shipment finance in the form of:

I) Foreign/Local Documentary Bills Purchase

II) Export Credit Guarantee

III) Finance against cash incentive

Foreign Remittance DBBL provides premium quality service for repatriation and collection of remittance with the help of its first class correspondents and trained personnel. By introducing on-line banking service and becoming a SWIFT Alliance Access Member, which enable its branches to send and receive payment instruction directly, which helps provide premium services. Remittance services provided by DBBL are:

➢ Inward Remittance:       Draft, TT

➢ Outward Remittance:    FDD, TT, TC and Cash (FC)

3.0 About DBBL E-Banking

Dutch-Bangla Bank Limited (DBBL) is a technology driven institution and a fully online banking organization. It caters to progressive clients who are accustomed to high levels of technology use and innovation. DBBL strives to provide its customers the latest in banking technology and delivery channels to make banking the most seamless task for its customers. DBBL’s technology vision is centered on the view that a high-end technology service is the innate right of the customer. A customer has the right to do seamless banking from any location they please and it is completely within their rights to expect this service uniformly through any medium. This vision leads to DBBL undertaking a comprehensive Information Technology (IT) project in 2003 where the entire system was automated at a cost of Tk. 1 billion.

3.1 REQUIREMENTS ANALYSIS:

Keeping the security and reliability in mind, the management of the bank identified some hardware and software components for the project. Among hardware installations were the multi-processor clustered servers, ATM, POS Terminal, Card Personalization System, High Capacity UPS, Host Security Module, Networking Equipment, and among the software installation were the Core Banking Software, Internet Banking Software, SMS & alert banking software, switching software, database and operating systems.

3.2 BACKGROUND OF E-BANKING OF DBBL

For case studies and acquiring technical knowledge about these hardware and software, a management team visited in different banks in Srilanka and India in January 2003. Thereafter the bank selected state - of – the - art technologies optimizing the cost for the project. Besides this, the bank has setup the largest and modern data center and online-synchronized Disasters Recovery Site (DRS) in Bangladesh to safe – guard the customers’ interest. A set of servers, networking equipments and UPS identical to the data center is installed at DRS. In case the data center is destroyed for any reason, the DRS will take over the control of branches, ATMs, POS Terminal, Internet Banking, SMS & alert banking systems. DRS is a crucial system for any bank and is standard for all leading worldwide banks, as the success of a bank after any disasters depends highly on its DRS. The implementation of the automation project started with formation of a core team. A team of 22 members, which included 14 members from the business and 8 members from the IT, took an eight weeks long extensive training on the project implementation issues.

After completion of all necessary formalities, such as floating of international tender’s, evaluation of tender documents the board of Directors of DBBL formally approved the project at a cost of Taka 250.00 million in September, 2003. The main components of the project were the world renowned, robust and tested banking software FLEXCUBE from ‘I-flex solution limited India world famous server from IBM USA switching software form oasis technology, Canada, world renowned Die bold ATM machines and Hyperion POS Terminals. The project also included an online disaster recovery site (DRS), first of its kind in Bangladesh to have effective disaster management system in place.

In February 2004, the User Acceptance Test (UAT) started in the data centered of the bank. The core team and networking team started installation of the servers, networking equipments and software, and customization of the same to adopt the prevailing banking rules and regulations of the country. Side by side, the switching team started installation of ATMs and POS Terminals and testing of their performance with the switching software.

After UAT was over, the roll – out of the branches from the old system to the newly installed system began. The IT division rolled – out one branch at every weekend and installed ATM under the respective branches. On 18 December 2004 the roll – out of all the branches of the bank was completed. The year – end operation of the bank has completed successfully on 30 December 2004, centrally at the data centre. .

Source: DBBL Card Division

Figure 3.1 DBBL Networking Systems

This is the real communication channel of DBBL online banking system. All the components are connecting with fiber optical network. And the head office of DBBL’s IT department can control any of the branch computers by this network. And they can provide any types of solution by sitting the head office.

3.3 REVOLUTIONIZING BANKING IN BANGLADESH

Thereafter, the bank opened 32 new branches at different cities/towns with ATM facility. From the first day, these branches and ATMs are on-line and provided real – time banking services. From the beginning, the valued customers of these branches are getting truly on-line facility, 24 hours a day, 7 days a week, through all the branches, ATMs and POS terminals all over the country and through the Internet from all over the world.

Using the new ATM services, the customers of DBBL can perform a range of banking activities including cash withdrawal, balance inquiry, printing mini statement, utility bill payment and fund transfer, 24 hours a day, 7 days a week and even on holidays.

Using the POS terminals the customers can pay shopping / dinning / hotel bills at various merchant locations throughout the country using DBBL cards and any Master Card or Visa branded cards.

Using the Internet Banking System the customers can access his/her account anytime from anywhere from the world through internet and can enjoy a plethora of banking services including account summary, account statement, fund transfer, bills payment, initiation and execution of Standing Instructions, opening and redemption of Term Deposits from/to his savings or current account and much more.

For secured and fast delivery of foreign remittance to the beneficiaries all over the country, DBBL’s on-line banking service and ATM network provides a unique solution. Now the non-resident Bangladeshis can send their money to their near and dear ones on the same days. After receiving the advice from different exchange houses abroad in electronic form, the Bank now credits the beneficiaries account directly from head office. Immediately the beneficiary can withdraw money from any branch counter or ATM booth of DBBL.

The introduction of on-line banking services along with various channels attracted a good number of retail customers mostly the service holders-, which is the base for the bank to start its retail (personal) credits business. Their loyalty to DBBL allows DBBL to focus more on this type of retail oriented client base.

In 2005, the Bank started issuing of MasterCard’s debit products – Maestro and Cirrus cards, and accepting MasterCard’s entire product range including MasterCard credit card, Maestro and Cirrus cards. In 2006, the Bank started issuing of Visa’s debit products – Visa Electron & Plus. From then onward, our valued customers have the option choose from the widest selection of cards.

After obtaining the acquiring licenses from MasterCard and Visa, and its execution in 2005, all MasterCard and VISA cardholders of other local and foreign banks are able to withdraw cash from our ATMs and pay shopping /hotel / dining bills using our POS terminals at the standard prescribed charge of the MasterCard and Visa.

In 2006, the Bank launched SMS and alert banking system for the first time in Bangladesh. The SMS and the alert banking system is a modern tool for banking using a mobile phone. This service puts the banking at the hands of our customers. The customers can now avail a wide range of banking services through his mobile phone, 24 hours a day, 365 days a year sitting at his home or vehicle. The ATM service offerings from DBBL are changing the way of banking practices of people, especially the students. Introduction of modern banking facilities for the general people of the country is a social service. To extend these services to more people, DBBL installed 800 ATMs throughout the country including rural areas. At the end of 2009, DBBL continues to have the largest ATM network by a significant margin. The Bank extended its ATM services to the customers of other banks and signed agreement with the following banks:

1. .Mutual Trust Bank Limited

2. Prime Bank Limited

3. Southeast Bank Limited

4. United Commercial Bank Limited

5. Standard Chartered Bank

6. Bank Asia Limited

7. National Credit & Commerce Bank Limited

8. Commercial Bank of Ceylon Limited

3.4 MAKING TECHNOLOGY AFFORDABLE FOR THE MASSES

DBBL clients are getting ATM access free of charge. For ATM access to other banking institutions, the cost per transaction at ATM is around Tk. 70/- (which is USD 1.00 and USD 1.25 per transaction if routed through Visa and MasterCard network respectively),. This price would be even higher when accounting in bank surcharges.

To help the customers of other banks, DBBL made separate agreements in which DBBL has agreed to charge only Tk 10/- per transaction to the partner banks. This price is insignificant considering the charges that other banks still pay to local ATM companies and the standardized Visa/MasterCard charges. It should be noted that even with this pricing and the continuing costs of maintaining the largest ATM network in the country, the Tk.1 billion investment of DBBL is not very rewarding. DBBL never scrutinized the project’s profitability but instead focused on the intrinsic benefits that it will bring to the customer.

DBBL wants the customers of other banks to avail the same benefits of DBBL customers. This will help develop the socio – economic condition of the country as a whole. More and more people will be able to get benefit of the modern technology both in urban and rural areas at an affordable cost. DBBL is bearing the differential cost as part of its CSR (Corporate Social Responsibility) activities.

3.5 COLLABORATING WITH OTHER BANKS FOR A COMMON GOAL

Even after servicing the numerous clients, DBBL decided to help member banks in their automation services. DBBL extended its support and expertise for reaching a common end goal of both DBBL and the partnering bank – serving the customer. To extend the ATM facilities to the suburban and rural areas where there is no DBBL – branches, DBBL has taken an initiative to install ATMs at the premises and nearby sites of other bank branches. Mutual Trust Bank has signed an agreement to this effect. Many other banks are in the pipeline to accept this service offered at a very attractive terms and conditions DBBL has priced it would take the institutions to implement it themselves. First Security Bank Limited is the first bank that signed with DBBL to avail these services. DBBL introduced new economical services cards and host the card information.

3.6 DBBL DEBIT CARD

Dutch-Bangla Bank Limited (DBBL) commenced its Debit card operation in August 2004. Initially DBBL has issued only DBBL NEXUS classic cards to the accountholders. At present there are over 150,000 + cards in the hands of the customers. At the moment, the total card market size (approx.) in Bangladesh is 7 lac. Among these, DBBL is having around 20% market share with 150,000+ DBBL NEXUS cards.

DBBL Debit card products are:

DBBL NEXUS Classic Card ;

DBBL NEXUS Maestro card;

DBBL NEXUS VISA Electron card

This most secure, convenient, and reliable forms of payment that enable consumers to freely conduct withdrawal of cash from 800 DBBL ATM network and purchase at DBBL 2000 POS Terminals.

To get a DBBL-NEXUS debit card, one has to open account in any branch of DBBL. After opening the account (SB/CD) the customer receives a DBBL NEXUS classic Card free of charge. To get a DBBL NEXUS Maestro or VISA Electron card, the customer has to inform the respective branch and then the desired card is issued to the applicant with a minimal fee.

3.7 DBBL CREDIT CARD

With a vision of rendering services through new financial products, Dutch-Bangla Bank Limited has started issuance of DBBL-NEXUS Gold and Silver Credit Card facility since June 2006. With this card, the cardholders can avail a OD facility from Tk.10, 000/- (ten thousand) up to Tk.2, 000,000/-(twenty lac) depending on credit worthiness.

DBBL Credit card products are:

DBBL NEXUS Silver OD card (credit);

DBBL NEXUS Gold OD card (credit);

DBBL NEXUS VISA credit card (in phases);

Eligibility for Credit Cards: The applicant has to be an accountholder of Dutch-Bangla Bank Limited.

They should belong to any of the following categories:

(a). Employees of different corporate bodies that have salary account with DBBL;

(b). Government service holders;

(c). Valued clients of DBBL;

(d). Employees of Banks, Financial Institutions, Multinational Companies, Telecommunication Companies, University / College/ School/ Autonomous Companies, Pharmaceuticals Companies, Professionals, Defense, VIP;

(e). DBBL borrowers, SB or CD account holders.

3.8 USER OF DBBL ATM CARD

The following persons generally use the DBBL ATM card-

• Retailers,

• Students,

• Professional peoples,

• Service Holders & many more.

3.9 PROCEDURE OF INTERBANK FUND TRANSFER

DBBL is the unique name of true Electronic Banking. All branches of DBBL is in one network. One can get all types of facilities from any branch of Bangladesh wherever the branch he has maintaining his account. When any client of DBBL provides any cheque to another person who has also an account in DBBL then he can get this money instantly without any procedure of clearing house. When the person submit the cheque of another person to transfer the fund to his own account then he needs to write a deposit sleep where he will be write his name, account number, cheque number, cheque date, the cheque amount, and also his signature. After getting the cheque along with the deposit sleep the banks at first will cheek the payees balance from where the fund will be transferred. Then the signature on the cheque with the specimen signature he provided to the bank. If these are ready then the authorized officer will make a phone call to the cheque holder for the conformation of this cheque. Sometimes he would be asked different types of tactical questions like his date of birth provides by the banks database and any other questions for identifying the real person. After conformation the officer will write down the details of the conformation that he got from the phone call. Then he will input the details of the cheque and the receivers account number into the software. When the amount exceed 20,000 (thousand) then its need the authorization of manager or 2nd manager. After verifying all the things the top level officers will grand this authorization request.

At last the officer will submit the fund transfer request that is granted by his superior. And instantly the fund will be transferred to the parties’ accounts.

Charges of Inter-Zone Fund Transfer:

|Amount of Transactions |Fees per transaction for inter-zonal |Charge to be relized from |

| |transactions (Tk) | |

|Up to Tk.1.00 lac |Nill | |

|Above Tk. 1.00 lac to Tk. 5.00 lac |100 |Account Holder |

|Above Tk. 5.00 lac to Tk. 15.00 lac |200 |Account Holder |

|Above Tk. 15.00 lac to Tk. 50.00 lac |300 |Account Holder |

|Above Tk. 50.00 lac |500 |Account Holder |

3.10 UPCOMING INITIATIVES

The normal bankcard was introduced 40 years ago and has failed to keep up with the rapid technology and security development that has been taking place in the industry. Its inherent problems caused competitors Visa and MasterCard to collaborate and create a next generation bankcard that will keep up with rapid security developments called EMV.

North America has started the transformation process in 2005 and has set the finishing deadline to 2016, where the entire continent will have upgraded to next-generation EMV technology.

DBBL keeps track of the latest security developments internationally and strives to give the same level of service to its local clients. To give more peace of mind to its customers along with more security, the Bank has also decided to implement EMV (Euro Pay, MasterCard and Visa) cards (both debit and credit) and acquiring of EMV compliant ATMs and POS terminals. DBBL for the first time in this region is going to offer a complete EMV (both in issuing and acquiring for both the Visa and MasterCard) solution for its customer with an investment of another Taka 60 million (in addition to its IT investment of Taka 1 billion).

DBBL is currently scheduled to be the first and only bank in SAARC to offer the full EMV solution (and only second in South East Asia). The entire transformation is scheduled to be completed by year 2011. The solution requires that the entire system (including POS, ATMs and cards) be upgraded.

While the NexusEMV card may look similar to a normal card, the technology on it and supporting it is revolutionary. It uses an onboard computer chip instead of a magnetic strip and relies on DBBL’s data center for on the spot verification. It features built in encryption algorithms mandated by Visa and MasterCard, which are impossible to duplicate or modify. It was designed and researched by Visa and NexusEMV is the future card standard.

DBBL also taking the strong initiatives to get the update version of FLEXCUBE software to provide their customers faster services. This procedure will be completed within 2011.

3.11 SERVICE PROVIDED BY ON-LINE OF DBBL

Through ATMs:

By using the DBBL’s own ATM booths anywhere in the country, the valued customers of the bank can perform the following functions at any time-

• Account balance enquiry

• Mini statement printing

• Statement request

• PIN (Personal Identification Number) change

• Request for Cheque Book

• Fund transfer within his/her own accounts

• Cash withdrawal – 24 hours a day, 7 days a week, 365 days a year

• Cash deposit to some designated number of ATM’s any time

• Payment of mobile/T&T phone, Gas, Electricity, Water, Internet, Credit Card bills from customer’s Savings/Current account.

Through Internet:

Through the Internet Banking of DBBL, the following can be performed:

• Checking of account balance

• Print-out of account statement for a particular period.

• Transfer of found within the customer’s own accounts

• Payment of mobile/T&T phone, Gas, Electricity, Water, Internet bills from customer’s account.

• Payment of School/College/University fees by debiting one’s account

• Purchase of activation number for mobile/internet pre-paid cards.

• Deposit of loan installments

• Stop Cheque payments

• Opening of an FDR (Fixed Deposit Receipt) account by debiting one’s Savings/Current/STD (Short Term Deposit) account

• Submission of L/C (Letter of Credit) application on-line

• Foreign Currency Exchange rates and interest rates enquiry.

3.12 The development of the DBBL’s ATM and other key e-banking services

DBBL is a technology driven institute. DBBL had undertaken a comprehensive IT project in the year 2003 in order to make the banking system automated. According to that plan bank setup the largest data center and online synchronized DRS (Disaster Recovery system).After the successful implementation and testing of that project DBBL introduces the ATM and POS system on 30th December, 2004. Initially bank installed 32 ATM centers in different branches.

|In 2004 |After the successful implementation and testing of that project DBBL introduces the ATM and POS system. |

|( At year end) |Initially bank installed 32 ATM centers in different branches. |

|In 2005 |DBBL has started to issue MasterCard’s debit product-Maestro and cirrus cards. And also accept the |

| |MasterCard’s entire product range including MasterCard credit card and Maestro and cirrus credit cards. |

|In 2006 |DBBL has started to issue Visa debit products-visa electron & Plus cards and accepting the visa card’s |

| |entire product range including the visa debit card, visa credit card, visa electron and plus. |

|In 2006 |DBBL introduced SMS alert or mobile banking system in Bangladesh. |

|In 2007 |DBBL extended it’s ATM service with other 8 prominent commercial banks of Bangladesh. |

|In 2009 |DBBL starts the mobile ATM service which increases the service availability.0 |

|In 2010 |DBBL starts MOBILE banking systems to increase the service |

| |Availability of customers. |

Source:

This Section of the report focuses on the growth of ATM system by DBBL in the divisional level and show how rapidly DBBL increasing its coverage of this ATM system. Another major aspect this section focuses is the year to year growth of the ATM system and the development of the DBBL’s other key e-banking services along with the collaboration of World class e-banking service providing Corporation.

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4.1 ICT operational guidelines and its compliance by DBBL

The Banking and Financial Industry has undertaken changeable degrees of

Revolution by stirring their operating systems to ICT platforms. Despite the intensity of computerization the security obligation of these systems are universal and are significant to the feasibility of the platforms.

To address this necessity Bangladesh Bank has taken the initiative to provide the industry with a guideline of ‘minimum’ security standards.

Let’s check out the guidelines of BB and how DBBL complies with those:

Table 4.1: The ICT guidelines by BB and compliance of DBBL

| Guidelines of BB |Compliance by DBBL |

|IT Management: |DBBL has the largest IT budget in Bangladesh. DBBL maintains the |

|IT Management must ensure that the IT functions are efficiently &|state-of-the-art Electronic-Banking Division. The |

|effectively managed. IT Management deals with – |Electronic-Banking Division oversees and maintains DBBL's |

|IT policy Documentation. |investment as well as implementing upcoming projects. |

|Internal IT Audit. | |

|Training and Insurance. | |

|IT policy Documentation: |One of the mostly emphasized departments of DBBL is its IT |

|The following will be documented properly |department. |

|Chart for IT department |DBBL maintains a sound operational chart for its IT department. |

|Job description (JD) for each individual within IT department |Within IT department of DBBL, each individual has been clearly |

|A scheduled roster for IT operation |assigned his duties and who is to report to whom is properly |

|Segregation of duties for IT tasks |documented and maintained. |

| | |

| | |

|Fallback plans for various levels of system support personnel |The duties for IT tasks are smoothly segregated and assigned to |

| |corresponding employees in IT department. |

|Internal IT Audit: |DBBL maintains the state-of-the-art Electronic-Banking Division. |

|Sufficient IT expertise / resources capable of conducting IT |This e-banking division has the richest IT expertise and |

|Audit. |resources for internal audit. |

| | |

|Periodically at least once a year. |This division of DBBL internal it audit 4 times in a year, that |

|Appropriate measures to address recommendations made in the last |means on quarterly basis. |

|Audit Report. | |

|Training and Insurance: |In DBBL e-banking division, some of the major personnel are well |

|Related employees should be given adequate training on sensitive |trained from abroad on ICT and its application in banking. |

|IT Tasks. |They provide proper training to the newly recruited employees. |

| |While recruiting in IT division, DBBL prefer software engineering|

|All the network users should be trained about its operating and |background. So far clients are quite adopted in prevailing |

|security procedures. |e-banking services. |

|Fire prevention: |DBBL’s ATM booths are well-prepared and those can resist small |

|The Data Centre wall/ceiling/door should be fire resistant. |fire exposures. |

|Fire suppression equipment should be installed. | |

|Procedures must exist for giving the immediate alarm of a fire, |Moreover, fire suppression equipments are kept in most of the ATM|

|and reporting the fire services and to be periodically tested. |centers. |

| | |

|Electric cables in the Data Centre must maintain a quality and |DBBL maintain quality Electric cables in the Data Centre so that |

|concealed. |possibility of sparking is minimized. |

| | |

|Any flammable items should not be kept in the Data Centre |Flammable items are not usually kept in the data centers. |

|Information Security Standard: |DBBL’s ATM card password pose at least 4 characters, combination |

|Password Control: |of uppercase, lowercase, numbers & special characters and client |

| |can change the password if he/she thinks it is not safe anymore. |

| |Each user of ATM has a unique User ID and a valid password The |

| |User ID will be locked up after 3 unsuccessful login attempts. |

|User ID Maintenance: |DBBL e-banking division software do not allow the same person to |

| |be both the maker and checker of the same transaction. |

| |Unauthorized access and Electronic tampering is controlled |

|Input Control: |strictly by DBBL e-banking division. Firewalls are in place on |

| |the network for any external connectivity. |

| |In DBBL, There is mechanism in place to encrypt and decrypt the |

|Network Security: |highly sensitive data traveling through WAN or public network |

| |Anti-Virus installed in each server and computer whether it is |

| |connected to LAN or not by DBBL. Virus auto protection mode is |

|Data Encryption: |enabled. The anti virus software is always updated. |

| | |

| | |

|Virus Protection: | |

| | |

[pic]

5.1 Growth of ATM system by DBBL (Regional level):

DBBL is providing the maximum number of ATM support to its clients and as well those banks clients who have collaboration with DBBL. The following chart gives an overview of DBBL ATM network in 7 divisions in Bangladesh.

Table 5.1: Growth of ATM system by DBBL (Regional level)

|Division |Dhaka |Chittagong |Khulna |Sylhet |Rajshahi |Barisal |Rangpur |

|Num of ATMs |1110 |205 |88 |156 |76 |28 |52 |

Source:

We see, Main focus is on Dhaka division in which DBBL established 1110 ATMs. The second largest ATMs holding division is Chittagong which is widely known as “port city” of Bangladesh. In Chittagong, DBBL puts 205 ATM booths. In Sylhet, 156 ATM booths are located. In Khulna, Rajshasahi, Barisal and Rangpur respectively 88, 76, 28 & 52 ATMs are located.

There has been given a chart for understanding of the regional growth of ATM system by DBBL:

[pic] Source:

5.2 Growth of ATM system by DBBL (Year to year increase):

DBBL has increased its ATM system comparatively faster than any other banks in Bangladesh. DBBL is the pioneer of all banks in Bangladesh to initiate and develop ATM system in a much wider way and provide World class ATM services at quite affordable cost to the of our country.

Table 5.2: Growth of ATM system by DBBL (Year to year increase)

|year |2005 |2006 |2007 |2008 |2009 |2010 |2011 |

| | | | | | | |( target) |

|Num of ATMs |32 |85 |210 |350 |700 |1000 |2000 |

Source: Financial Statements of DBBL.

Here, we see, after the initial establishment of 32 ATMs at the beginning of 2005, DBBL’s effort to establish wide number of ATMs from year to year increases. And we see, from year 2008 to 2009, DBBL installed 350 new ATMs in just one year and it has targeted to establish 2000 ATMs at the year end of 2011.

Let see the Growth of ATM system by DBBL from the point of view of Year to year increase in chart for better understanding of the trend of increase:

[pic]

5.3: Growth of ATM system and its effect in profitability of DBBL:

Banks are, like any other business organizations, profit oriented. And like any other commercial banks, DBBL’s one of the major missions is to make profit.

DSBBL official say it to the public that they are performing CRS activities by providing wide range of e-banking services against a very low amount of charge for it. This true to some extent because the quality of ATM and other e-banking service that are provided by DBBL ids world class by standard but the charge they take for it is quite lower in respect to other developed countries’ banks whose service quality is of that standard.

They are not charging high for e-banking services, but this automation indirectly increases the overall profitability of DBBL. The discussion from the previous section, we can easily understand that how the growth of ATM system positively effect the growth of deposits of SDBBL. This increases deposits, of course, in effect increase the overall profitability of DBBL. Not only deposits, there are some other major aspects which are being accelerated by this huge development of e-banking services by DBBL and which are, altogether, contributing significantly to increase the profitability of DBBL.

The following table shows the growth of profit of DBBL and after the initiation of ATM system in 2005, how profitability trend increased:

Table 5.3: The growth of Profit in DBBL over the years

|Year |2001 |

|Largest banking service provider in the commercial bank and |Low deposit rate and minimum balances are too high. |

|operate near about 1000 corporate client. |Non functioning ATM machines, delay for providing cards. |

|Qualified, hard working & dedicated human resources |Poor coordination & communication between Head offices and |

|Gets advantage for ATM card |branches |

| |

|Opportunities |Threats |

|If reducing its current fees & charges and positioning |At present Trust Bank, EBL and BRAC Bank are posing significant |

|attractively , so DBBL can attract more corporate client |threats to DBBL regarding retail and business banking |

|By offering more attractive interest rates, and lowering the |respectively. |

|minimum balances eligible for interest, the bank can attract a |Furthermore, the new comers in private banking sector are also |

|lot of the old customers |coming up with very competitive products. |

6.0: About Customer Satisfaction

Kotler (2000) defined satisfaction as: “a person’s feelings of pleasure of disappointment resolution from comparing a product are perceived performance (or outcome) in relation to his or her expectations”. Hoyer and Maclnnis (2001) said that satisfaction can be associated with feelings of acceptance, happiness, relief, excitement, and delight.

There are many factors that affect customer satisfaction. According to Hokanson (1995), these factors include friendly employees, courteous employees, knowledgeable employees, helpful employees, accuracy of billing, billing timeliness, competitive pricing, service quality, good value, billing clarity and retention.

6.1: Evaluate Customer satisfaction level of DBBL ATM Service:

This part of the report has been completely on the basis of the eleven outcomes that have been discovered from the questioner survey. This chapter deals with “customer satisfaction level of DBBL ATM services”. The data have been collected by survey at Dhanmondi Branch. However the following six outcomes have been analyzed through pie chart.

|No. of Respondents |Male |Female |

|200 |66% |34% |

6.1.1 Gender range of the Respondent

Figure 6.1.1: Gender range of the Respondent

In this study, my Respondent depend on gender, male are 66%, and female are 34%.

6.1.2: Age range of the Respondent

|Total number of respondents |20-24 |25-29 |30-34 |

|Total no of respondents |Student |Service holder |Business |Housewife |

|200 |51% |16% |19% |14% |

Figure 6.1.3: Occupation of the respondent

In this study, my Respondent depends on occupation, Students are 51%, Service people are 16%, and Business-persons are 19% and house-wife are14%. So, here the maximum Respondent depend on occupation are Student (51%) and minimum Respondent house-wife (14%).

6.1.4: Family Income Level of the Respondent

| Family Income level of the Respondent |

|Total number of respondents |Below 10000 |10000-20000 |20000-30000 |30000-40000 |40000-50000 |Above 50000 |

|200 |4% |10% |44% |12% |17% |13% |

[pic]

Figure 6.1.4 Family Income Level of the Respondent

In this study, my Respondent depend on family income level, the maximum Respondent which family income level are 20000-30000 and Respondent 44%, and minimum Respondent which family income level are 40000-50000 and Respondent 4%.

6.1.5: Card users of the Respondent

| |Card Users | | |

|No. of Respondents |Debit Card |Credit Card |Both |

|200 |93% |0% |7% |

[pic]

Figure 6.1.5 Card users of the Respondent

In this study, my Respondent depend on card users, the maximum Respondent are debit card users are 93% and moderate are both card users (debit and credit card) are 7%, only credit card users are 0%.

6.1.6: Using rate of DBBL Card.

| |Using rate of DBBL Card | |

|Total no of respondents |Regularly |Frequently |Very Frequently |

|200 |70% |27% |3% |

[pic]

Figure 6.1.6: Using rate of DBBL Card

In this study, my Respondent depend on using rate of DBBL card, the maximum Respondent are using card regularly are 70% and the minimum Respondent are using card very frequently are 3%.

People’s response is satisfactory. In this part, I have given a detail description of it. For my study purpose, I have taken 200 people as sample. Five points rating scale is also used here for attitude measurement. The attitudes of people towards the existing performance of DBBL ATM service is expressed in below.

6.2: Debit card makes your life easier and it's easily accessible.

49% strongly agree and 39% agree and 10% moderately agree that DBBL Debit card make their life easier and giving them flexibility at withdrawing money. On the2% strongly disagree because they think that this service makes them puzzle. They are not use to with this service.

|Variable |Respondent |Percentage of respondent |

|Strongly Agree |98 |49% |

|Agree |78 |39% |

|Moderate |20 |10% |

|Disagree |0 |0% |

|Strongly Disagree |4 |2% |

[pic]

Figure 6.2: Debit card makes your life easier and it's easily accessible

Analysis: Here I see that the majority people are thinking that ATM service makes their life easier, and very few percent of people are not taking these facilities. While the surveying period I have found that students and service holder are strongly agree and agree that ATM service makes their life easier. But the customer who uses this card very frequently like house wives, they are moderately agreed and the business person who are using card regularly they have to face some problems and dissatisfied with the service. Mainly they think that this service is not sufficient to make their life much easier.

6.3: Service charge is reasonable

10% strongly agree and 32% agree that compare with other bank DBBL yearly service charge is lower than compare with other bank. And 26% moderately agree and 38% disagree and 13% strongly disagree with this opinion.

|variable |respondent |Percentage of respondent |

|Strongly Agree |20 |10% |

|Agree |64 |32% |

|Moderate |52 |26% |

|Disagree |38 |38% |

|Strongly Disagree |26 |13% |

[pic]

Figure 6.3: Service charge is reasonable

Analysis: Majority of customers is agreeing that DBBL service charge is lower than any other banks. In my survey almost 42% of total respondent are agreed that the service charge is lower. Because DBBL has no per transaction charge but other banks have. And also DBBL yearly service charge for card is only 400 and first year totally free. But 26% are moderately agreed and 38% of customer is disagreed about this statement. On the other hand some of the customers are totally strongly disagree with this statement. Because they the maximum are student. They think ATM charge should reduce.

6.4: Power supply is Available

In this point, 7% respondents are strongly agreed, 8% are agree, 15% are moderate, 13% are disagree and 57% are strongly disagree with this statement.

|Variables |Respondent |Percentage of Respondent|

|Strongly Agree |14 |7% |

|Agree |16 |8% |

|Moderate |30 |15% |

|Disagree |26 |13% |

|Strongly Disagree |114 |57% |

[pic]

Figure 6.4 Power supply is Available

Analysis: In my survey I find that majority customer strongly disagree that power supply is available in the ATM Booth. Because they face power failure situation when they withdraw money from ATM Booth. On the other hand only poor customer think that power supply is available in the ATM Booth and they don’t any power failure problem or they think this problem is considerable in our country.

6.5 Security is sufficient.

23% respondents are strongly agreed, 36% are agree, 24% are moderate, 14% are disagree and 3% are strongly disagree with this statement.

|Variable |Respondent |Percentage of Respondent|

|Strongly Agree |46 |23% |

|Agree |72 |36% |

|Moderate |48 |24% |

|Disagree |28 |14% |

|Strongly Disagree |6 |3% |

[pic]

Figure 6.5 Security is sufficient.

Analysis: In the security view point most of the customer is satisfied. They fill always secured when they withdraw money from the ATM Booth. Some customers are filling unsecured because they regularly withdraw handsome amount from the Booth.

6.6: Don't face any network, cash jam and time out problem

6% respondents are strongly agreed, 10% are agree, 15% are moderate, 14% are disagree and 55% are strongly disagree with this statement.

|Variable |Respondent |Percentage of |

| | |Respondent |

|Strongly Agree |12 |6% |

|Agree |20 |10% |

|Moderate |30 |15% |

|Disagree |28 |14% |

|Strongly Disagree |110 |55% |

[pic]

Figure 6.6: Don't face any network, cash jam and time out problem

Analysis: I find that most of the customers who are using ATM Booth regularly are complain that they not getting money from ATM Booth. The point shows that network, cash jam and time out problem of DBBL is a paining situation. It indicates that customers are always facing this type of problem. They are suffering network, cash jam, time out even fake note problem. That’s why customers are so disagree with this statement.

6.7: Service quality of DBBL ATM services.

32% respondents are strongly agreed, 39% are agree, 19% are moderate, 8% are disagree and 2% are strongly disagree with this statement.

|Variable |Respondent |Percentage of Respondent |

|Strongly Agree |64 |32% |

|Agree |78 |39% |

|Moderate |38 |19% |

|Disagree |16 |8% |

|Strongly Disagree |4 |2% |

[pic]

Figure 6.7: Service quality of DBBL ATM services.

Analysis: Although there are some problems in the ATM Booth, customer perception about Service quality of DBBL ATM services is good, because here most of the respondent are strongly agree and agree because they use the ATM service with positive attitude about ATM service and they think this type of problem is considerable. On the other hand some respondent think this type of problems are increasing bad image about ATM service of DBBL ATM services.

Analysis: In my survey, I find that most of the customers are thinking that overall service quality of DBBL is good because 25% respondents are strongly agreed 39% are agree, 24% are moderate about this statement, this percentage shows the service quality of DBBL is good and customer is satisfied.

Scale

|S.L. |Statements |SA |

6. |Debit card makes your life easier. |5 |4 |3 |2 |1 | |7. |I can easily access ATM card in the ATM booth. |5 |4 |3 |2 |1 | |8. |There are sufficient numbers of ATM booth in your area. |5 |4 |3 |2 |1 | |9. |The number of ATM booth should be increased. |5 |4 |3 |2 |1 | |10. |I get available money in the ATM booth whenever I access them. |5 |4 |3 |2 |1 | |11. |DBBL ATM card service charge is lower than any other Bank. |5 |4 |3 |2 |1 | |12. |Yearly service charges of DBBL ATM card should be reduced. |5 |4 |3 |2 |1 | |13. |UPS facility is available in the ATM booth. |5 |4 |3 |2 |1 | |14. |Power supply facility is available in the ATM booth by Generator. |5 |4 |3 |2 |1 | |15 |I always get fresh and clean money from DBBL ATM booth. |5 |4 |3 |2 |1 | |16. |I never found any fake note in DBBL ATM booth. |5 |4 |3 |2 |1 | |17. |I never faced any network problems in the DBBL ATM booth. |5 |4 |3 |2 |1 | |18. |I don’t face any cash jam problems in the DBBL ATM booth. |5 |4 |3 |2 |1 | |19. |I don’t face any time out problems in the DBBL ATM booth. |5 |4 |3 |2 |1 | |20. |I don’t face any power failure problems in the DBBL ATM booth. |5 |4 |3 |2 |1 | |21. |I can easily access all type of service in ATM machine. |5 |4 |3 |2 |1 | |22. |Security staff behavior is nice. |5 |4 |3 |2 |1 | |23. |Security is sufficient in front of ATM booth. |5 |4 |3 |2 |1 | |24. |I always feel secured when I withdraw money from ATM booth. |5 |4 |3 |2 |1 | |25 |The overall services of DBBL ATM machines are good. |5 |4 |3 |2 |1 | |26 |I am very much satisfied by using the ATM machine of DBBL. |5 |4 |3 |2 |1 | |27 |The service quality of ATM services of DBBL is high. |5 |4 |3 |2 |1 | |28 |The procedure for collecting the ATM card of DBBL is short. |5 |4 |3 |2 |1 | |

Finally to ensure that have all types’ opinions represented in my survey. I would like you to answer the following question.

29. Occupation: 0 Students 0 Service 0 Businesses 0

30. Age: 0 20-24 0 25-29 0 30-34 0 35-39 0 40-44 0 45-49 0 50-54 0 50 Above

31. Gender: 0 Male 0 Female

32. Marital status: 0 Single 0 Married

33. District of origin:

34. Your monthly family income level:

Below Tk.10000 Tk.10000-Tk.20000 Tk.20000-Tk.30000

Tk.30000-Tk.40000 Tk.40000-Tk50000 above Tk.50000

[pic][pic][pic]

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Chapter – 2

Organization Profile

Chapter – 3

Electronic Banking Activities of DBBL

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Chapter 04

ICT operational guidelines and its compliance by DBBL

Chapter: 05

Analysis of DBBL E-Banking

➢ Trend analysis

➢ Index analysis

➢ SWOT analysis

Chapter 06

Survey on different E-Card of DBBL

Chapter – 7

Findings, Recommendations & Conclusion

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