A STUDY ON DEPOSIT COLLECTION OF

MACHHAPUCHCHHRE BANK LIMITED

A Project Work Proposal

By

Suman Gurung
Campus Roll No: 115
T.U. Registration No: 7-2-238-124-2016

Submitted to
Management Research Committee
Faculty of Managment
Tribhuvan University
Kalika Multiple Campus

Pokhara -14
Kajipokhari
 TABLE OF CONTENT

Title Page
INTRODUCTION (1-9)
1. Background 1

2. Profile of the organization 2

3. Objective of the Study 4

4. Statement of the Problem 4

5. Rationale of the Study 5

6. Review of Literature 5

7. Methods of Research

7.1 Research Design 6

7.2 Source and Nature of Data 6

7.3 Population and Sampling 6

7.4 Methods of Data Collection 7

7.5 Data Processing and Analysis 7

8. Limitation of the Study 8

Biblography
1. Background of the study
‘BANK’ is origin from Latin word ‘BANQUE’ which refers to the bench on which the banker
would keep its money record. Some believers it has been origin from French word ‘BENCA’
which means a beach for keeping leading and exchanging of money charges, A bank is a
financial institution that accepts deposits from the public and creates credit. Banks borrow
money by accepting funds, deposits and by issuing debt securities such as banknotes and bonds.
Banks lend money by making advances to customers on current accounts, by making installment
loans, and by investing in marketable debt securities and other forms of money lending.

Banking system plays a very important role in the economic life of the nation. The health of the
economy is closely related to the soundness of its banking system. In a developing country like
Nepal the banking system as a whole plays a vital role in the progress of economic development.
Loan facility provided by banks works as an incentive to the producer to increase the production.
Banking is now an incentive to the producer to increase the production. First of all, banking
promotes savings. All manner of people, from the ordinary laborers and workers to the rich and
owners and businessman saving centers can keep their money as deposit safely in bank.

Commercial banks play an important role in the economic development of the nation. Hence, the
performance of commercial banks can have a marked influence on the development of an
economy. Deposit collection is one of the main feature and function of commercial bank. A
commercial bank receives deposit in different accounts namely current, fixed and saving which
are direct deposits. These transactions are recorded on the bank’s books, and the resulting
balance is recorded as a liability for the bank and represents the amount owned by the bank to the
customer.

Deposit are the most important aspects for the banks as well as financial institutions. A deposit
account is a savings account, current account or any other type of bank account that allows
money to be deposited and withdrawn by the account holder. These transactions are recorded on
the bank’s books, and the resulting balance is recorded as a liability for the bank and represents
the amount owned by the bank to the customer. Banks can affect the money supply through
demand deposit, or loans that the bank funds through cash deposits it receives. By using interest
rates to create their own profit, banks are also creating money to increasing the money supply in
the economy. Thus, deposit collection is the main important tool for the financial and banking
system.
2. Profile of the Organization
Machhapuchchhre Bank Limited (MBL) was registered in 1998 as the first regional commercial
bank from the Western region of Nepal and started its banking operations from Pokhara since
year 2000. The Bank facilitates its customer needs by delivering the best of services in
combination with the latest state of the art technologies and prudent international practices. It is
the first bank to introduce centralized banking software, GLOBUS BANKING SYSTEM of
Temenos NV, Switzerland. The bank provides modern banking facilities such as Any Branch
Banking, Internet Banking, Mobile Banking, Safe Deposit Locker facilities, Utility Bill payment
(Telephone & Mobile), ATM (VISA Debit Cards) to its valued customers. Besides these, the
bank is providing 365 days banking and Evening counter services to the customers through many
of its offices. Now with a paid up capital of over 8.46 billion rupees, 145 Branch Offices, 138
Branchless Banking Units, 2 Extension Encounter and 182 ATMs spread all across the country,
it is one of the full-fledged national level commercial banks operating in Nepal.

The vision of MBL is to become the bank of the first choice of the people. The mission of MBL
is to be one of the most preferred Banks in Nepal, easily recognized as the Bank which satisfies
and cares for its customers through quality service, innovative products, professionalism and
wide branch network, offering full array of financial services using modern technology and with
good corporate governance practices. MBL is functioning with the following five core values:

1. Integrity

2. Accessibility

3. Value Creation

4. Quality Service

5. Stewardship of Resources

MBL has adopted some technological to ease its customer service. They are listed below:

 Easy and secured banking anytime anywhere

 MBL mobile money
 Internet banking
 MBL visa credit card
 MBL dollar prepaid card
 Visa debit card
 ATM
 Post terminals
 Branchless banking
3. Objectives of the Study
Every study has its own specific objective. The core objective of this study is to analyze the
deposit collection of Machhapuchchhre Bank limited. The study intends to present a brief and
clear picture of deposit and its utilization. Moreover, the specific objectives of the study are:

 To analyze different types of deposit

 To access the amount of deposit collection
 To find out the variations in deposit collection in different Fiscal Year.
 To reach out to the common ground of conclusion.

4. Statement of the problem

As we know that the main objective of any business organization e.g. Bank is profit
maximization. Deposit collection is the key factor to attain this objective: Therefore, if the bank
fails to employ its funds suitably it is not possible to maximize profit. A bank has to make
decisions with a framework of statutory requirements of credit regulation by center bank, as well
as the national objectives that are determined in the matter of the provision of credit from time to
time. Therefore, this study seeks to explore the answer of the following question.

 What is the current trend of deposit collection?

 What is the deposit collection of MBL?
 What is the relationship between interest rate and deposit?

5. Rationale of the Study

The study results decision maker of the bank to know the strength and weakness of their deposit
department. It will be also helpful for those who want to deposit to MBL, as they will be quite
familiar with the procedure of the deposit. Some other importances are mentioned below:

 The required data and information concerns to the financial aspects can be acquired and
studies by its stakeholders.
 This study will be helpful to everyone from every aspect. The businessmen, taxpayers,
donor parties and central government can be beneficial from the study.
 The findings and the conclusions drawn from the study will be helpful for the officials to
take corrective measures.
 The customer will benefited by knowing the procedure of deposit collection.
5. Review of Literature

A literature survey is both summary and explanation of the complete and current state of
knowledge on deposit collection and loan distribution are found in academic books and journals
articles. Literature review refers to the documentation of the comprehensive review of published
works from secondary sources of information. Review of the literature is an essential part of
research- it is a way to discover what other research in the area of our problem has uncovered.
Thus, the task in the literature review is to learn as much as one can from the efforts and work of
others. This activity however cannot be haphazard if it is to be efficient. Like most aspect of
research it needs thought and planning.

6. Methods of the Study

A systematic approach and methodology is needed in order to do any type of study and prepare
report on that study. Methodology is the description of the procedure followed while collection
the necessary data and information needed for research work and report preparation. This report
has been designed to give a clear picture of the operations performed in Machhapuchchhre Bank
Limited. The research methodology includes, research design, data collection procedures and
research variables and tools use. The following step provides useful procedural guidelines, so far
as research methodology is concerned.

6.1. Research Design

Research design is an overall framework, outline and plan for conducting the research. Choosing
appropriate research design is must to reach into conclusion. The ultimate goal of this study is to
analyze and evaluate deposit transactions of different years, so it requires in-depth study. Thus,
Descriptive research design is to be followed. Descriptive research design would be favorable in
conducting this study as it provides detailed information of any topic and describes all the
relevant aspects of the study.

6.2. Sources and Nature of Data

Data can be collected through Primary and secondary sources. This research is based on
secondary sources. However, primary data is obtained as research requirement. The secondary
data has been gathered from annual reports, published documents and its official website. Other
necessary data and information were collected through newspaper, various articles published on
journals and other websites
6.3. Population and Sampling

The population refers to the organizing of the same nature on its services and products.
Altogether there are 142 banks running in Nepal. Out of which 1 is central bank, 28 commercial
banks, 57 are development banks, 36 are finance companies and 48 are micro development
banks. As per umbrella act, bank and financial institutions can be classified as A, B, C and D
classes on the basis of minimum paid of capital. Accordingly, commercial banks are class A and
they are labeled as banks. Similarly development banks, finance company, co-operative are
categorized into ‘B’, ‘C’ and ‘D’ class respectively. The umbrella act named as bank and
financial institution act, 2063 has been enacted effectively for the e proper and smooth operation
of the banks (Nepal Rastra Bank, 2072). The objective of the study is to find the total deposit of
the Machhapuchhre Bank Limited. I would like to select this bank because it is the commercial
bank, earning high profit and providing loan to the public with lower interest rate and gives
effective interest rate to the depositors. To organization, the population for the research works
and convenience sampling method is used.

6.4. Methods of Data Collection

This section generally represents the research methodology adapted to carry out the field work
report. A research design is a framework or plan for the activities to be undertaken during the
course of study. These research are mostly based on the secondary data and information, so
descriptive research design is applied.

6.5. Data Processing and Analysis

Most of the data are collected from the secondary sources. Some of the data are collected
through the discussion with the office staff and direct observation tasks. Moreover practical
approaches have been applied in collection the necessary data. The presentation and analysis of
the collected and managed data has been analyzed and interpreted through analytical approaches.
The overall presentation and analysis is in descriptive form.

7. Limitation of the Study

Every study has its own limitation. There are some of the limitations which the researcher may
face while reaching to the conclusion.

 The study is only concentrated with deposit collection.

 Accuracy, reliability and validity of the study will be depended upon the information
provided by concerned authorities.
 Time and resources put constraints for the study.
 The analysis of financial transactions and deposits will be incomplete as it provides data
of last five years only.
 This study is based on qualitative data only.
BIBLIOGRAPHY

 Kothari, C.R. (2009) Research Methodology, Methods and Techniques. New

Delhi: New Age International Publishers.
 Dhakal, A. (2015). A study on Deposit Collection of Siddhartha Bank
Limited. Tribhuwan University.
 Bhattarai R. (2014). A case study on deposit collection of Nepal Investment
Bank Limited.(Unpublished B.B.S. Report).
 Baral, M (2017). Deposit Collection of OM Development Bank Limited,
Tribhuwan University.
 Pant, P.R.(1998). Field work Assignment and Report writing. Kathmandu,
Veera Academic Enterprise pvt.ltd.