1663789117187Operations Manual 2022 Draft.pdf

1
Operations Manual
Revised Version, September 2022

2
Table of Contents
INTRODUCTION .........................................................................................................................................1
1.1. CUSTOMER SERVICE DEPARTMENT (CSD) ..................................................................................1
1.2. DEALING WITH CUSTOMERS...........................................................................................................1
1.2.1. ACCOUNT OPENING ........................................................................................................................2
1.2.2. DOCUMENTS REQUIRED FOR ACCOUNT OPENING ................................................................4
INDIVIDUAL ACCOUNT..................................................................................................................5
ACCOUNT OF PARTNERSHIP OR SOLE PROPRIETORSHIP FIRM........................................6
ACCOUNT OF COMPANY ...............................................................................................................7
ACCOUNT OF CLUB/ NON-GOVERNMENTAL ORGANIZATION............................................9
ACCOUNTS OF COOPERATIVES ..................................................................................................9
ACCOUNTS OF PUBLIC / PRIVATE GUTHI...............................................................................10
ACCOUNTS OF SCHOOL/ CAMPUS ............................................................................................11
ACCOUNTS OF INGOS...................................................................................................................12
ACCOUNT OF FOREIGNERS........................................................................................................13
ACCOUNTS OF FOREIGN COMPANIES.....................................................................................14
ACCOUNTS OF DIPLOMATIC AGENCIES/ EMBASSIES .........................................................14
ACCOUNT OF NON-RESIDENTIAL NEPALESE (NRN) ............................................................15
ACCOUNT OF LOCAL CONSUMER COMMITTEE (UPABHOKTA SAMITI) ........................15
1.2.3 ONLINE ACCOUNT OPENING .......................................................................................................18
1.2.4 ONLINE ACCOUNT OPENING THROUGH NAGARIK APPLICATION ....................................19
1.2.4 ONLINE KYC UPDATE ....................................................................................................................21
1.3. MAINTENANCE OF ACCOUNT OPENED.......................................................................................21
1.3.1. CHEQUE BOOKS .............................................................................................................................21
1.3.1.1. UNCOLLECTED CHEQUE BOOKS ............................................................................................23
1.3.1.2. ISSUING OF CROSS BRANCH CHEQUE BOOK.......................................................................24
1.3.1.2 PROCEDURES FOR ISSUING CHEQUE BOOK AGAINST LOST CHEQUE BOOK..............27
1.3.1.3 CHEQUE BOOK PRINTING IN RESTRICTED ACCOUNTS ....................................................27
1.3.2. LOOSE CHEQUES ...........................................................................................................................27
1.3.3. WITHDRAWAL SLIP.......................................................................................................................28
1.3.4. FUND TRANSFER FORM................................................................................................................29
1.3.5. STATEMENT OF ACCOUNTS........................................................................................................29
1.3.6. BALANCE CERTIFICATE ..............................................................................................................30
1.3.7. ADVANCE PAYMENT CERTIFICATE..........................................................................................31
1.3.8. INCENTIVE FOR EXPORT.............................................................................................................32

3
1.3.9. FOREIGN DIRECT INVESTMENT CERTIFICATE.....................................................................34
1.3.10. CHANGE OF ADDRESS, CONTACT NUMBER AND NOMINEE OF ACCOUNT...................35
1.3.11. CHANGE OF SIGNATURE/ STAMP.............................................................................................36
1.3.12. STOP PAYMENT OF CHEQUES ..................................................................................................37
1.3.13. GOOD FOR PAYMENT (GFP) CHEQUES...................................................................................38
1.3.13.1. PROCEDURE TO MARK A CHEQUE AS “GOOD FOR PAYMENT”....................................38
1.3.13.2. CANCELLATION OF A GOOD FOR PAYMENT CHEQUE: ..................................................39
1.3.14. DORMANT ACCOUNT..................................................................................................................39
1.3.15. STANDING INSTRUCTIONS ........................................................................................................40
1.3.16. ACCOUNT OF DECEASED PERSONS.........................................................................................40
1.3.16.1. ACCOUNT WITH NOMINEE.....................................................................................................41
1.3.16.2. ACCOUNT WITHOUT NOMINEE.............................................................................................41
1.3.16.3. DELEGATION OF AUTHORITY TO BRANCHES FOR CLOSING ACCOUNTS OF
DECEASED ...................................................................................................................................42
1.3.17. ACCOUNT OF MINOR ..................................................................................................................42
1.3.18. ACCOUNTS OF ILLITERATE PERSON......................................................................................43
1.3.19 ACCOUNT OF BLIND/ VISUALLY IMPAIRED PERSON AND DIFFERENTLY ABLED
PERSON ........................................................................................................................................44
1.3.20. RECURRING DEPOSIT ACCOUNTS:..........................................................................................45
1.3.20.1. PREMATURE OF RECURRING DEPOSIT ACCOUNT...........................................................46
1.4. ACCOUNT CLOSING ........................................................................................................................46
1.4.1. CLOSING OF INDIVIDUAL ACCOUNTS: ....................................................................................47
1.4.2. CLOSING OF ACCOUNTS OF FIRM/COMPANY/INSTITUTION ETC.:...................................47
1.5. FIXED DEPOSIT (FD).........................................................................................................................48
1.5.1. ELIGIBILITY TO OPEN A FD ........................................................................................................48
1.5.2. PROCEDURE OF OPENING A FD .................................................................................................48
1.5.2.1. FIXED DEPOSIT IN FOREIGN CURRENCY .............................................................................50
1.5.3. RATE OF INTEREST ON FD AND MINIMUM DEPOSIT............................................................50
1.5.4. STOCK OF FDR................................................................................................................................51
1.5.5. PAYMENT OF FD.............................................................................................................................51
1.5.6. PRE-MATURITY OF FD..................................................................................................................52
1.5.7. STANDING INSTRUCTION FOR RENEWAL OF FD...................................................................53
1.5.8. INTEREST ON MATURED FD........................................................................................................53
1.5.9. ISSUE OF DUPLICATE FDR...........................................................................................................54
1.5.10. LOAN AGAINST FD.......................................................................................................................54
1.6. LOCKER ..............................................................................................................................................56

4
1.6.1. INTRODUCTION..............................................................................................................................56
1.6.2. ALLOTMENT OF LOCKERS..........................................................................................................56
1.6.3. LOCKER VISIT OPERATIONS ......................................................................................................57
1.6.4. GENERAL NORMS: LOCKER OPERATIONS..............................................................................58
1.6.5 ITEMS FOUND UNATTENDED IN THE LOCKER ROOM ..........................................................58
1.6.6 LOSS OF THE LOCKER KEY..........................................................................................................59
1.6.7 NON-PAYMENT OF LOCKER RENT.............................................................................................59
1.6.8 BREAK-OPEN OF LOCKER UPON NON RECOVERY OF BANK CHARGES...........................59
1.6.9 SURRENDER OF LOCKER..............................................................................................................60
1.6.10 DEATH OF THE LOCKER HOLDER............................................................................................60
1.6.11 RISK GRADING & CUSTOMER DUE DILIGENCE FOR ALLOTMENT OF LOCKERS........61
1.7 BLACKLISTING ..................................................................................................................................61
1.7.1 CONDITIONS FOR BLACKLISTING: ............................................................................................62
1.7.2 RELEASING FROM BLACKLIST:..................................................................................................64
1.8. WAIVER IN FEES & COMMISSION / TRANSACTION REVERSAL & DELETION...................64
1.9. SAFE KEEPING OF BANK STAMPS ................................................................................................64
1.10. MISCELLANEOUS............................................................................................................................65
2. CASH DEPARTMENT ...........................................................................................................................66
2.1. MAINTENANCE OF CASH ................................................................................................................66
2.1.1. LIMIT OF CASH AT VAULT ..........................................................................................................66
2.1.2. PROCEDURE....................................................................................................................................67
2.1.3. NRB CLEAN NOTE POLICY 2073..................................................................................................68
2.1.4. CASH IN TRANSIT ..........................................................................................................................69
2.1.5. WITHDRAWAL FROM NEPAL RASTRA BANK/NOSTRO ........................................................71
2.1.6. VERIFICATION OF CASH AND SECURITY ITEMS...................................................................71
2.1.7. CASH SHORT/EXCESS ...................................................................................................................71
2.1.8. BAIT MONEY OR BAIT BILLS ......................................................................................................72
2.2. CASH RECEIPT AT COUNTER ........................................................................................................73
2.3. PAYMENT OF CASH..........................................................................................................................74
2.4. PROCEDURES FOR SALES OF FCY CASH ....................................................................................76
2.5. PROCEDURES FOR PURCHASE OF FCY CASH............................................................................76
2.6. RETURN OF UNPAID CHEQUES .....................................................................................................78
2.7. UNIDENTIFIED DEPOSITS ACCOUNT...........................................................................................78
2.8. END OF THE DAY (EOD) OPERATION...........................................................................................79
2.8.1. VAULT CASH MANAGEMENT REPORT (VCM REPORT)........................................................79

5
2.9. CUSTODIAN OF VAULT KEY ..........................................................................................................79
2.9.1. SAFE KEEPING OF TRANSACTION LISTS AT BRANCH .........................................................80
2.10. AGREEMENT WITH BANKS & FINANCIAL INSTITUTIONS (BFI) REGARDING PAYMENT
OF CHEQUES AND ACCEPTANCE OF DEPOSIT OF CUSTOMERS.........................................81
2.10.1. INTRODUCTION............................................................................................................................81
2.10.2. PROCEDURE ..................................................................................................................................82
2.10.2.1. PAYMENT OF CHEQUES OF OTHER BANKS AND FINANCIAL INSTITUTIONS............82
2.10.2.2. DEPOSITS IN ACCOUNTS OF OTHER BANKS AND FINANCIAL INSTITUTIONS ..........82
2.10.2.3. PAYMENT OF OUR BANK’S CHEQUES BY OTHER BANKS AND FINANCIAL
INSTITUTIONS ............................................................................................................................82
2.10.2.4. DEPOSIT IN OUR BANK’S ACCOUNT BY OTHER BANKS AND FINANCIAL
INSTITUTIONS ............................................................................................................................83
2.10.2.5. ORIGINAL CHEQUES ................................................................................................................83
2.10.2.6. AUTHORIZED SIGNATORY .....................................................................................................83
2.10.3. TARGET ..........................................................................................................................................83
2.10.4. FEES & COMMISSIONS................................................................................................................83
2.10.5. SOFTWARE ....................................................................................................................................83
2.10.6. STRATEGIC ALLIANCE...............................................................................................................83
2.10.7. RISK MANAGEMENT ...................................................................................................................84
2.10.8. RESPONSIBILITY OF TREASURY FRONT OFFICE ................................................................84
2.10.9. RESPONSIBILITY OF DURBARMARG BRANCH .....................................................................84
2.10.10. ACCOUNTING ENTRIES ............................................................................................................84
2.11. 365 DAYS BANKING SERVICE .......................................................................................................86
2.11.1. SERVICES OFFERED IN 365 BANKING SERVICE ...................................................................86
2.11.2. STAFF MANAGEMENT.................................................................................................................86
2.11.3. OPERATIONS OF 365 BANKING SERVICE ...............................................................................87
2.12. EVENING COUNTER SERVICE......................................................................................................87
2.12.1. SERVICES OFFERED IN EVENING BANKING SERVICE .......................................................87
2.12.2. STAFF MANAGEMENT.................................................................................................................87
2.12.3. PROCEDURES OF EVENING BANKING SERVICE ..................................................................88
2.12.4. ACCOUNTING ENTRIES:.............................................................................................................88
2.13. SCHEDULE OF WORKING HOURS...............................................................................................89
3. REMITTANCE........................................................................................................................................90
3.1. INWARD REMITTANCE....................................................................................................................91
3.2. OUTWARD REMITTANCE................................................................................................................91
3.2.1 PROCEDURE OF OUTWARD REMITTANCE ..............................................................................91
3.3. ARRANGEMENTS REQUIRED FOR REMITTANCE.....................................................................93

6
3.4. MODES OF REMITTANCE................................................................................................................94
3.4.1. BANK DRAFT/DEMAND DRAFT...................................................................................................94
3.4.1.1. PARTIES INVOLVED IN A DEMAND DRAFT...........................................................................94
3.4.1.2. PROCEDURE OF ISSUING DEMAND DRAFT ..........................................................................95
3.4.1.3. PAYMENT OF DRAFT..................................................................................................................96
3.4.1.4. ISSUANCE OF DUPLICATE DRAFT...........................................................................................96
3.4.1.5. CANCELLATION OF DRAFT......................................................................................................96
3.4.2. FAX TRANSFER/SWIFT TRANSFER ............................................................................................97
3.4.2.1. FAX TRANSFER............................................................................................................................97
3.4.2.2. SWIFT TRANSFER........................................................................................................................98
3.4.3. REFUNDING OF EDUCATION SERVICE TAX DUE TO VISA REJECTION............................98
3.5.3. MANAGERS CHEQUE (MC)...........................................................................................................99
3.5.3.1. PURPOSE OF ISSUING A MC.................................................................................................... 100
3.5.3.2. PROCEDURE FOR ISSUE OF MC............................................................................................. 100
3.5.3.3. PAYMENT OF MC....................................................................................................................... 101
3.5.3.4. STALE MANAGERS CHEQUE .................................................................................................. 102
3.5.3.5. CANCELLATION AND REVALIDATION OF MC................................................................... 102
3.5.3.6. LOSS OF MC................................................................................................................................ 103
3.6 MISCELLANEOUS ............................................................................................................................ 103
4. CLEARING ........................................................................................................................................... 104
4.1. ELECTRONIC CHEQUE CLEARING (ECC) ................................................................................. 104
4.1.1. OUTWARD CHEQUE CLEARING............................................................................................... 105
4.1.2. OUTWARD CLEARING FOR EXPRESS CHEQUE .................................................................... 107
4.1.3. OUTWARD CHEQUE RETURN PROCESSING.......................................................................... 107
4.1.4. NCHL ECC TRANSACTION CHARGES ..................................................................................... 108
4.1.4. MAINTAINING PHYSICAL CHEQUE......................................................................................... 108
4.1.5. INWARD CHEQUE CLEARING (ECC)........................................................................................ 109
4.2. CLEAN BILL COLLECTION........................................................................................................... 110
4.2.1. WORK FLOW OF CHEQUE COLLECTION............................................................................... 110
4.3.2. PROCEDURE TO BE FOLLOWED BY BRANCH....................................................................... 111
4.3.3. PROCEDURE TO BE FOLLOWED BY REMITTANCE DEPARTMENT ................................. 111
4.3.4. PROCEDURE TO BE FOLLOWED BY RECONCILIATION DEPARTMENT......................... 112
4.4. INTERBANK PAYMENT SYSTEM (IPS)........................................................................................ 112
4.4.1 INTRODUCTION: ........................................................................................................................... 112
4.4.2 TRANSACTION SUPPORTED BY IPS:......................................................................................... 114

7
4.4.2.1. OUTWARD PAYMENTS: ........................................................................................................... 114
4.4.2.2. INWARD PAYMENTS: ............................................................................................................... 115
4.4.3 PRODUCTS/PURPOSE UNDER IPS:............................................................................................. 115
4.4.4 COMMISSION AND FEES: ............................................................................................................ 119
4.4.5 WORKING PROCEDURE/ MODULE: .......................................................................................... 120
4.4.5.1 PROCEDURE FOR OUTWARD PAYMENT.............................................................................. 121
4.4.5.2 PROCEDURE FOR INWARD PAYMENT.................................................................................. 123
4.5 CONNECTIPS..................................................................................................................................... 124
4.6 REAL TIME GROSS SETTLEMENT (RTGS).................................................................................. 125
4.6.1 PROCEDURES FOR RTGS: ........................................................................................................... 125
4.7 CORPORATEPAY.............................................................................................................................. 127
4.8 NATIONAL PAYMENT INTERFACE (NPI).................................................................................... 128
5. SUMMARY OF APPROVING AUTHORITY ..................................................................................... 130

1
OPERATIONS MANUAL
Introduction
This document lays down the procedures of Operations Department. While preparing this
manual, focus has been made on the prevailing procedures, policies and guidelines,
Directives of Nepal Rastra Bank (NRB) and other statutory requirements. Therefore, this
document shall be periodically reviewed to incorporate any changes in the prevailing
procedures, policies and guidelines, NRB directives and any other statutory requirements.
The purpose of this Manual includes the following:
• Procedures of Operations Department.
• Roles and responsibilities of staffs working in Operations Department.
• Guidelines for effective functioning and to assist staffs in case of confusion regarding
any operational process and procedures.
Operations in bank chiefly includes following areas:
• Customer Service
• Customer Help Desk
• Account Opening
• Safe Deposit Lockers
• E-banking
• Mobile Banking
• Cash Transactions
• Remittance
• Clearing
• Manager‟s Cheque
• Good for Payment Cheque
• Holiday/ 365 days Counter
1.1. Customer Service Department (CSD)
Major functions of Customer Service Department (CSD) include dealing with customers,
Account opening, maintenance & closing procedures, and Safe Deposit Lockers.
1.2. Dealing with Customers
CSD is the area where any prospective customer first comes in contact with the bank. The
staffs deployed in the CSD should have a fair knowledge of Banking and our bank products so
that they may be able to answer questions which may be raised by the customer. Staff at CSD
should pay proper and personal attention to the customers. A person coming to the bank for
any purpose must be dealt promptly and with courtesy. Staff at CSD/Front Office must greet
with a “Namaste” with closed hands and “Smile” to each and every customer coming to the
department for inquiry or taking any kind of advice or services. As CSD is considered to be
face of bank, staff working in CSD should be polite, courteous and respectful to the customers,
which add value to our brand.

2
1.2.1. Account Opening
Procedures
• Complete sets of forms should be readily available at CSD. Account Opening Form
(AOF) (Specimen 1), KYC Form (Specimen 60 and 61) and Specimen Signature (SS)
Cards (Specimen 2) used for both Individual and Firm/Company applicant should be
pinned together and enough stock of these documents should be kept in CSD.
• Specimen Signature Card is included in the Account Opening Form. Hence, separate
Specimen Signature card is not required to be obtained unless number of signatures
exceeds the space available in the SS Card included in the AOF.
• The customer/authorized signatory/ies should personally visit the branch to open an
account. However, in case of differently abled person, old aged or a highly reputed
person who cannot come personally to the bank, the DRO can be deputed to collect the
forms by obtaining signature and thumb impression in his/her presence. Further, in case
of highly reputed person, if the Branch Manager /Assistant Branch Manager/Operations
In-charge/ Head of CSD is personally satisfied about the genuineness of the contents of
the Account Opening Form, KYC Form and signature and thumb impression of the
customer affixed therein, the customer may authorize a person to visit the branch to
open account on his/her behalf.
• The applicant should be counseled by CSD staff by inquiring about his/her purpose of
deposit and preference, and describing about available deposit products and their
features that suits his/her/their need.
• Account Opening Form should be completed by the customer himself or by his
designate. He/she may, however, be guided by the bank staff to complete the form with
utmost courtesy. The CSD staff must ensure that all the required fields of AOF and
KYC forms have been filled up by the customer and required documents have been
submitted. If there is any correction made, signature of customer is to be obtained on
the corrected parts.
• The customer should be properly inquired about whether he/she wishes to nominate a
person as nominee of the account. If he/she likes to name a person as nominee,
nominee details field should be completely filled up and signed (full signature) by the
account holder. Similarly, a copy citizenship certificate of the Nominee should be
invariably obtained.
• If the customer does not like to mention any nominee, the nominee details fields
should not be left blank, but crossed marked. If the customer wishes to mention
nominee of the account later, a separate request letter can be obtained mentioning the
details of the nominee similar to that of AOF along with a copy of citizenship
certificate of the nominee.
• Location of address should be drawn by the customer in the KYC form. Similarly,
name of nearest landmark such as road junction, temple, school, hospital etc. should
also be mentioned and distance of the residence/office from that landmark is also to be
mentioned. The CSD staff should check if the map has been drawn in a traceable
manner.

3
• Full name along with father‟s name/husband‟s name, grand father‟s name, details of
occupation, office, permanent and current addresses, telephone numbers and other
required details as per NRB should be mentioned in the KYC form.
• The Introducer details and signature should also be compulsorily obtained in AOF.
When a customer submits the Account Opening form duly introduced, the introducer's
signature therein should be verified by the CSD. However, BM/Assistant Branch
Manager/ Operations In-charge or CSD staff can also sign as the introducer of the
customer after properly verifying the submitted documents and genuineness of the
customer.
• The Specimen Signature Card should be signed by the customer/authorized signatory in
the presence of the staff of Customer Service Department.
• Instructions regarding operation or any special instructions of the customer in the
Account Opening Form should be clearly mentioned. The operational instructions
should also be noted clearly on Specimen Signature Card.
• Thumb Print of the customer should be taken in the KYC Form. For the convenience to
scan image in the system, thumb impression can additionally be obtained in Specimen
Signature field as well.
• Name of customer willing to open account must be checked in the sanctioned list of
Trust AML software. If applicant is a firm, all authorized signatories or joint venture
partners should also be checked in the sanctioned list. The generated Screening ID
should be inserted in Screening ID field under MIS Tab while opening account. If the
customer is found in the sanctioned list, the account should not be opened.
• If the customer falls under the High-Risk category, then additional documents as per
our AML and CFT Policy/Procedures must be obtained from customer and account
should only be opened after taking approval from COO or Head – Central Operations
in case of leave of COO (as per specimen 58).
• Similarly, the customer should also be cross checked in blacklisting database through
integrated blacklist checking module in MIS by entering details in all fields as far as
possible. If the name of the applicant and personal details such as name of father,
grandfather, citizenship certificate number etc. match with the blacklisted database, the
account should not be opened.
• After confirming that all the required information and documents for account opening
have been obtained, the CSD should proceed for opening the account. After opened the
account, signature of CSD staff, Operation In-charge/Head CSD and Branch Manager
are to be obtained in Bank‟s Use section of the AOF and KYC documents.
• In case of individual accounts, the branch should fill up data in DMS of Account
Opening module, upload supporting documents and submit the form so that the account
can be opened by Central Account Processing Unit at Head Office. Branch should
ensure all the required data have been filled and clear copy of required documents have
been uploaded in DMS so that chances of the AOF getting rejected is minimized.
• In case of accounts that have not been integrated in Centralized Account Processing
and are being opened by branches, the approval/verification of account opening must
be done by Operation In-charge or by Head CSD in branches having such facility.

4
• Record of all the accounts opened during a day has to be updated in the Account
Opening Register (Specimen 4) within the same date. Report can also be generated
through MIS for record keeping as per the requirement of the branch.
• After account has been opened, specimen signature of the customer/authorized
signature/ies of the SS Card should be scanned and the image of Specimen Signature
and photographs/stamps is to be uploaded in the CBS by the evening of the same day.
Cheque book should not be issued and debit transaction should not be allowed in the
account without uploading image in the system.
• Account opening report (Specimen: 6) should be prepared at the end of the day (as
per mentioned format in specimen) and should be approved with initials of Branch
Manager along with Operations In-charge/ CSD In-charge/Staff daily. Alternatively,
MIS report: “Account Opening Datewise” can also be generated and initials of the
account opening and verifying staffs should be obtained before filing.
• 2 copies of passport size of photograph is to be obtained from the customer. Digital
Photo can also be accepted by the bank. One copy of photograph is to be attached with
the Specimen Signature (SS) card, while another is to be attached with KYC.
• In case the customer gives account operating mandate to any other person, 2 copies of
photographs, KYC and identification documents (Citizenship, Passport) of the
Mandatee shall also be obtained. Mandate Form (Specimen 5) shall be obtained for this
purpose. Thumb impression of the Mandatee should be obtained in KYC form.
Additionally, thumb impression can also be obtained in in Specimen Signature Card
for the convenience of scanning image. In the operating instruction of image, it
should be mentioned as “Mandate has been given Mr./Ms….” and on the image of the
mandatee, “Mandatee” should be mentioned in brackets next to his/her name.
• As a supplementary document, Voter‟s identity card can be downloaded from Election
Commission Nepal website and kept in account opening form. If the customer is
willing to provide bills of utility payment, it can also be accepted.
• A single page Account Opening Form cum simplified KYC form is to be obtained for
Saral Bachat Khata or any other account type/scheme as directed by Government of
Nepal / NRB Directives. Simplified KYC form can also be used to open accounts if the
expected turnover in the account is up to or below Rs.100,000/-. Simplified KYC form
can also be obtained in case of social security payment accounts under G2P scheme.
• Account Opening Form, KYC form and Specimen Signature (SS) Card and supporting
documents of account opening are permanent records and these documents could be
easily retrieved in case of need. Hence, they are to be kept in Index files in serial wise
manner according to the scheme of account and stored properly in lockable filing
cabinets.
1.2.2. Documents Required For Account Opening
While opening an account, depending upon whether the customer is an individual or firm,
company, association, NGO etc., following information and documents in accordance with
the nature of the customer must be obtained which is in accordance with the KYC Policy of
NRB.

5
The branch is to ensure that the copies of all the mentioned documents are clear and
readable. The branch should not accept documents which have faint print or are unclear.
Customer‟s signature (authorized signature and stamp in case of firm) is to be obtained on
the back side of each copy of document mentioning it of being true copy of the original.
Further, all the copies are to be verified with the original documents and Verified with
Original stamp and signature of verifying staff are to be affixed.
Individual Account
• Copy of Citizenship Certificate, Passport or National Identity Card
• 2 PP size Photographs
• Additional Documents such as Employee ID Card in case of Rastra Sewak Bachat Khata,
Student ID Card in case of Biddhyarthi Bachat Khata, Passport, VISA or Residence
Proof Document in case of Matribhumi Bachat Khata, letter of the employer in case of
Talab Bachat Khata etc.
• If the customer does not have telephone number, mobile number or email ID, a self-
declaration is to be obtained mentioning that he/she does not having a personal contact
number.
• In case of an Indian national, passport or registration certificate issued by Embassy of
India can be accepted. The expiry dates of both passport of registration certificate
should be recorded in the Finacle system similar to recording of expiry date of VISA
of foreign account holders so that account can be total frozen from the expiry date.
• In case of refugee, Refugee Card issued by Nepal Government or UNHCR can be
obtained instead of Citizenship Certificate.
• In case of minor, Birth Certificate of minor, Citizenship Certificate or Passport of
Guardian and 2 PP size photographs each of both are required. If the minor has crossed
16 years of age and has also obtained Citizenship Certificate, it can also be accepted
instead of Birth Certificate. Separate KYC form of both minor and guardian is to be
obtained.
• In case the applicant or authorized signatory falls under high risk category as per AML –
CFT Policy/Procedures or NRB Directives, Citizenship Certificate/Passport/Birth
Certificate of nearest family members (Ekaghar Pariwar) is also to be obtained.
• If the applicant is a major, but has not obtained a citizenship certificate, account can be
opened based on recommendation letter with attached photograph of the applicant
obtained from Rural Municipality/Municipality/Sub-Metropolitan/Metropolitan office.
However, prior approval from Central Operations Department is to be obtained. Only
account under Saral Bachat Khata scheme with Simplified KYC can be opened under
this provision, in which the annual turnover in the account should not exceed
Rs.100,000/-.

6
Account of Partnership or Sole Proprietorship Firm
• Registration Certificate (Registration No., Registering Office, Registered Date)
• Permanent Account Number (PAN)/VAT Registration Certificate
• Registered Address of the Firm (District, Municipality / VDC, Ward No., Tole /
Village, House No., Telephone No., Fax No.)
• New address of firm in case registered address has changed
• Nature of Business
• Working Area
• No. of branches and location of main branches
• Estimated Annual Turnover of business
• Citizenship Certificate and Personal Details of Proprietor, Partners and Account
Operators (Position, Name, Surname, Name of Husband / Wife, Father, Grandfather,
Permanent Address, Present Address, Telephone No., Mobile No., E-mail address)
• Photocopy of Citizenship Certificate / Passport and PP size photo of Proprietor,
Partners and Account Operators
• KYC of the firm (corporate KYC form) and its proprietor (individual KYC form) are
to be obtained. In case of Partnership Firm, KYC of all partners is to be obtained.
• Audited Financials of the last fiscal year. For firms not requiring their financials to be
audited, provisional financials prepared by the firm can be obtained. In such case, a
declaration of the firm is also to be obtained mentioning non requirement of audit as
per tax policy. Similarly, for a newly established firm, a self-declaration is to be
obtained mentioning that they would submit the audited financials within 3 months
after the starting of next fiscal year. After the completion of the fiscal year, branch
needs to do continuous follow-up with the Proprietor/authorized partner of the firm to
ensure timely submission of audited financials.
• Tax Clearance certificate or statement of tax submission of last fiscal year. For a
newly established firm, a self-declaration is to be obtained mentioning that they would
submit the tax clearance certificate/statement of tax submission within 3 months after
starting of new fiscal year. After the completion of the fiscal year, branch needs to do
continuous follow-up with the Proprietor/authorized partner of the firm to ensure
timely submission of tax clearance certificate/statement of tax submission.
• Renewed registration certificate, audited financials, tax clearance certificate etc. are to
be updated in the accounts of the firms at the time of CDD/ECDD depending upon the
risk grade of the firm.
• Partnership Agreement / Deed in case of Partnership Firm.

7
• Minute giving mandate to authorized signatories for financial and administrative
works in case of Partnership Firm
Account of Company
• Registered Address of the Firm (District, Municipality / VDC, Ward No., Tole /
Village, House No., Telephone No., Fax No., E-mail Address, Web Address)
• Permanent Account Number (PAN)/ VAT Registration Certificate
• Certificate of Incorporation, Memorandum of Association and Articles of Association
of the Company.
• Latest Share Holding Document (Share Lagat) certified by Company Registrar Office
• New address of company in case registered address has changed
• Registration Certificate (Registration No., Registering Office, Registered Date) in M/s
Company Registrar Office.
• Working Area
• Estimated Annual Turnover
• Details of Directors, Chief Executive and Account Operators (Position, Name,
Surname, Name of Husband / Wife, Father, Grandfather, Permanent Address, Present
Address, Telephone No., Mobile No., E-mail address)
• Photocopy of Citizenship Certificate / Passport and 2 PP size photographs of all
Directors, Chief Executive and Account Operators.
• Citizenship Certificate and Personal details of Shareholders holding 10% or more
shares (Name, Surname, Name of Husband/Wife, Father, Grandfather, Permanent
Address, Present Address, Telephone No., Mobile No., Email ID.
• If the shareholder holding 10% or more shares is a legal entity (firm/company),
personal details (Name, Surname, Name of Husband/Wife, Father, Grandfather,
Permanent Address, Present Address, Telephone No., Mobile No., Email ID) of
Shareholders of that legal entity holding 10% or more shares. Shareholders holding 10%
or above shares of a company are considered as beneficial owners. Registration
Certificate, PAN Card, MOA, AOA, Share Lagat, tax clearance document and other
details of the company are also to be obtained.
• KYC form of Company, its Directors, beneficial owners (shareholders holding 10% or
more ownership), CEO and authorized signatory/ies to be obtained. CIF ID of all these

8
parties is to be created in Finacle CBS. Whereas, CIF IDs of Directors, CEO and
authorized signatories are to be linked with the corporate account in Related Party
Details at Account level, CIF IDs of beneficial owners are to be linked in Relationship
Details at CIF ID of the company.
• Audited Financials of last fiscal year. If it is a newly established company, a self-
declaration is to be obtained mentioning that they would submit the audited financials
within 3 months after starting of next fiscal year. After the completion of the fiscal
year, branch needs to do continuous follow-up with the authorized person/s of the
company to ensure timely submission of audited financials.
• Tax Clearance certificate or statement of tax submission of last Fiscal Year. For a
newly established company, a self-declaration is to be obtained mentioning that they
would submit the tax clearance certificate/statement of tax submission within 3 months
after the starting of new fiscal year. After the completion of the fiscal year, branch
needs to do continuous follow-up with the authorized person/s of the company to
ensure timely submission of tax clearance certificate/statement of tax submission.
• Audited financials, tax clearance certificate, Share Lagat (Shareholding Certificate) etc.
are to be updated in the accounts of the firms at the time of CDD/ECDD depending
upon the risk grade of the account.
• If the company is a subsidiary of a Foreign Company, name and address of the Foreign
Company
• Board Minute for the opening of account, account operating instruction and names and
designation of signatories authorized to operate account.
• Mandate / Power of Attorney given to Chief Executive or Other Officers by the Board
for doing Financial Transactions.
• In case of Joint Venture Firm/Company, Registration Certificate, PAN card,
Memorandum of Association, Articles of Association, Share Lagat, Tax Clearance
Certificate of last Fiscal Year, personal details holding more than 10% or more shares
etc. should be obtained of all individual firms. If another firm/company is holding 10%
or more shares in any of the individual companies then all the documents mentioned
above of that company is to be issued. Similarly, PAN certificate in joint name of JV
partners and minute of the JV partners to open account and for nominating account
operators are to be obtained. Likewise, KYC of authorized signatories and Corporate
KYC of individual firms and JV firm are to be obtained. Screening of all individual
firms and JV firm is to be done separately.
If one of the joint venture partners is a foreign country, permission letter from
concerned government authority for working in Nepal is also to be obtained.

9
Account of Club/ Non-Governmental Organization
obtained from M/s District Administration Office. Registration at M/s Social Welfare
Council also in case of NGO.
• Permanent Account Number (PAN) Certificate.
• Registered Address (District, Municipality / VDC, Ward No., Tole / Village, House
No., Telephone No., Fax No., E-mail Address, Web Address)
• New address in case registered address has changed
• Work Area
• Citizenship Certificate and Personal Details of Executive Committee Members,
Director, Trustee, Controller, Settler and Custodian (Position, Name, Surname,
Permanent Address, Present Address, Telephone No., Mobile No., e-mail address and
Employed Organization Name, Address and Contact Number)
• KYC of Chief Executive and Account Operators
• Photocopy of Citizenship Certificate / Passport and PP size photo of Chief Executive
and Account Operators
• Audited Financials of last fiscal year
• Constitution / By-Laws (Bidhan)
• In case of tax exempt organization, Tax Exempt Certificate issued by Inland Revenue
Office is to be obtained. The Tax Exempt Certificate is to be renewed every year and
its copy is to be updated in bank records. Please note that unless explicitly mentioned
in the Tax Exempt Certificate about waiver of tax also on interest income, TDS on
interest is applicable.
• Minute of Executive Committee for opening the account, account operation and
authorization provided to signatories for doing financial transactions.
Accounts of Cooperatives
• Registration Certificate (Registration No., Registering Office, Registered Date) at M/s
Company Registrar Office and M/s Department of Cooperatives.
• Permanent Account Number (PAN)

10
• New address in case of change in registered address
• Work Area
• Citizenship Certificates and Personal Details of Directors (Position, Name, Surname,
Name of Husband/Wife, Father, Grandfather, Permanent Address, Present Address,
Telephone No., Mobile No., e-mail address)
• KYC of Directors, Chief Executive and Account Operators
• Photocopy of Citizenship Certificate / Passport and PP size photo of Directors, Chief
Executive and Account Operators
• Audited Financials of last Fiscal Year
• Tax Clearance certificate or tax submission details of Previous Fiscal Year.
• Constitution / By-Laws
• Board decision for the opening of account and its operation and authorization provided
to signatories to do Financial Transactions.
Accounts of Public / Private Guthi
• Permanent Account Number (PAN)
• Changed address in case of change in registered address
• Work Area

11
• Citizenship Certificates and Personal Details of Directors / Management Committee
Members, Chief Executive and Account Operators (Position, Name, Surname, Name
of Husband / Wife, Father, Grandfather, Permanent Address, Present Address,
Telephone No., Mobile No., e-mail address)
• Photocopy of Citizenship Certificate / Passport and PP size photo of Directors or
Management Committee Members, Chief Executive and Account Operators
• Agreement / Consent Deed regarding establishment of Guthi
• Board / Management Committee decision for the opening of account and its operation
and authorization provided to signatories for doing Financial Transactions.
• Tax submission statement of last Fiscal Year.
• In case of tax exempt organization, Tax Exempt Certificate issued by Inland Revenue
Office is to be obtained. The Tax Exempt Certificate is to be renewed every year and
its copy is to be updated in bank records. Please note that unless explicitly mentioned
in the Tax Exempt Certificate about waiver of tax on interest income, TDS on interest
paid to the account is to be deducted.
Accounts of School/ Campus
• Registration Certificate (Registration No., Registering Office, Registered Date)Name
of School or Campus. Request letter of School/College or recommendation letter of
Local Government if it is a Government School.
• Permanent Account Number (PAN) Certificate (for private school/college only).
• License obtained from Ministry of Education/concerned board for running
school/college according to level of education.
• Changed address in case there is change in registered address
• Work Area
• No. of branches and location of corporate office and main branches

12
• Citizenship Certificates and Personal Details of Directors/Management Committee
Members (Position, Full Name, Name of Husband/Wife, Father and Grandfather,
Permanent Address, Present Address, Telephone No., Mobile No., Email address)
• Photocopy of Citizenship Certificate / Passport and PP size photo of Chief Executive
Officer/Managing Director and Account Operators
• KYC of Chief Executive Officer/Managing Director and Account Operations
• Tax Clearance Certificate or tax submission statement of Last Fiscal Year
• Certified Copy of License for Registration of the Firm (Permission Letter for
Operating School/College)
• Memorandum of Association and Articles of Association
• Minute of Board / Management Committee for opening of account and authority
delegated for doing Financial Transactions.
Accounts of INGOs
• Permanent Account Number (PAN) Certificate
• Changed address in case of change in registered address
• Work Area
• No. of branches/offices and location of main branches/offices
• Citizenship Certificate/Passport and Personal Details of Directors, Chief Executive
and Nepal Representative or Chief (Position, Name, Surname, Name of Husband /
Wife, Father, Grandfather, Permanent Address, Present Address, Telephone No.,
Mobile No., e-mail address)
• Photocopy of Citizenship Certificate / Passport and PP size photograph of Chief
Executive or Nepal Representative or Chief and Account Operators.

13
• KYC of Chief Executive Officer, Country Representative or Chief and Account
Operators.
• Agreement executed between Social Welfare Council and INGO, if any
• Recommendation Letter from concerned Country or its Embassy in Nepal in case of
INGOs not registered or obtained affiliation from authorized body in Nepal.
• Tax Submission Statement of Last Fiscal Year in case of taxable entity.
• If the organization is a local committee or club of an international club, decision of its
central committee for incorporation of the local committee and decision to operate
account.
• Request letter and minute for opening of account and its operation and Power of
Attorney given to Account Operators for Financial Transactions.
Account of Foreigners
• Full Name, Surname
• Address in Foreign Country (Permanent and Temporary)
• Address in Nepal
• Name of Spouse, Father, Grandfather and other family members
• Passport / Visa:
Passport No: ………………… Issuing Country ……........... Issue Date………,
Expiry Date ……… Visa Expiry Date ……………………...
• Copy of valid Visa (Not Expired)
• Copy of Passport
• If the person is employed, name of organization, address, contact number and
Recommendation Letter of the Employer.
• Foreigners, except for Indians, can only open account in USD or other permissible
FCY according to the currency of their residing country. Foreigners cannot open any
type of account in NPR currency.
• The expiry date of the validity of VISA of the foreigner should be marked in Finacle
CBS so that the account becomes debit frozen if the VISA of the account holder
expires.

14
Accounts of Foreign Companies
• Name of Company
• Address and contact details of Foreign Company‟s Head Office and Main Office
situated in Foreign Country
• Address and contact details of Foreign Company in Nepal
• Nature of Business of Office situated in Nepal (Branch, Contact, Project or others)
• Registration Certificate in Foreign Country (Registration No., Registering Office,
Registered Date)
• If registered in Nepal, details and documents of the registration and PAN
• Work Area
• No. of branches/offices and location of main branches/offices
• Memorandum of Association and Articles of Association
• Foreign Company‟s decision for the opening of account and its operation and Power
of Attorney for Financial Transactions
• Details of Foreign Company‟s Directors and Chief Executive Officer (Position, Name,
Surname, Address, Telephone No., Mobile No., e-mail address)
• KYC, Citizenship Certificate/Passport, PP size photo of Two Chief Executives, Nepal
Representative and Account Operators.
• Audited Financials of last Fiscal Year. Provisional Financial Reports in case of newly
registered firm/company.
• Tax clearance certificate or tax submission statement of last Fiscal Year.
Accounts of Diplomatic Agencies/ Embassies
• Letter of Embassy/Mission
• Mandate for account operation
• KYC, Photo, Passport, address verifying documents of Account Operators
• Any additional documents if deemed necessary.

15
Account of Non-Residential Nepalese (NRN)
• Full Name and Address in Nepal
• Permanent and Current Address and contact details in Foreign Country
• Name of Father, Mother, Grandfather, Spouse and Other Family Members
• Documents evidencing Income Source
• Copy of NRN Identity Card issued by Nepal Government
• Copy of Registration at M/s Non Resident Nepali Association (NRNA)
• Photocopy of valid Passport
• 2 PP size Photographs
Account of Local Consumer Committee (Upabhokta Samiti)
• Minute of Upabhokta Samiti for its constitution.
• Minute of Upabhokta Samiti for opening account and authorized signatory/ies to
operate account.
• Recommendation Letter of Local Government Body to the bank for opening account
of Upabhokta Samiti with details of Authorized Signatory/ies to operate account.
• Type of Business of Upabhokta Samiti
• Expected Annual Turnover in number and amount.
• Copy of Citizenship Certificate or Passport, 2 PP size photographs and personal
details of Account Operators (Authorized Signatories) of account
• In case Upabhokta Samiti is registered in any government body, copy of its
Registration Certificate.
• KYC document of Upabhokta Samiti and all authorized signatories
• Declaration letter of Upabhokta Samiti that the transaction in the account will be done
only for the purpose of meeting their business objectives.
Notes:
• Interview of customer might also be conducted by the Branch Manager/ABM/OI, if
felt needed.

16
• In case of customers, who do not have details of House No., Telephone No., Mobile
No., E-mail address, Passport, Occupation/Business, PAN etc., the same will not be
mandatory. However, customer must provide declaration in writing that such details
are not available with him/her.
• Photocopy of citizenship of all family members (unseparated members of family)
must be obtained of those customers falling under high risk category as per AML-
CFT Policy/Procedures or whose Enhanced CDD has to be conducted. In case of
minors, birth certificate or identification card is to be obtained.
• An account holder can provide mandate to another person for operating the account.
However, signature of the account holder should always remain valid and account
operating instruction should not be implemented in such a way that single signature
of the Mandatee remains valid. To clarify further, if it is an individual or a sole
proprietor or partnership, mandate can be provided to another person, but the
signature of the account holder should always remain valid.
Similarly, for availing any new service in the account such as availing Mobile
Banking or Internet facility, connectIPS services etc., request is to be received from
the account holder only. Likewise, for discontinuing any service or closing the
account, request must be received from the account holder.
If the account holder cancels the mandate previously given to any person, mandate
enjoyed by the Mandatee for availing various banking services of the bank on behalf
of the account holder also gets cancelled. Hence, necessary changes in the CBS and
third party applications such as Mobile Banking, E-banking Demat, CCMS etc.
should be made on urgent basis for removing his/her contact details (mobile
number/email ID) from these systems.
• In case of Refugees, photocopy of an identity card issued by a government or any
other authorized body (UNHCR) can be accepted instead of citizenship.
• For opening account in USD or any other convertible foreign currency permitted by
NRB, income source document is to be obtained. Income source of foreign currency
could be service agreement with some foreign company, advance received for exports,
salary income from a foreign company, income earned by working as a freelancer of
a foreign based company, income earned from foreign employment, donation
received by NGO/INGO from foreign country, income earned by being a
blogger/vlogger in a social media platform, savings from foreign exchange facility
availed against passport while going to a foreign country, any other source as defined
in NRB‟s Foreign Exchange Management Unified Circular from time to time.
For showing repatriation of income from investment including investment in business
or shares, while staying in foreign country, as a source document to open a FCY
account, a copy of declaration made at NRB within 35 days after returning to Nepal
should also be obtained.
In case of an individual, FCY amount received as donation, gift etc. cannot be
considered as a source document for opening FCY account.

17
• If the Beneficial Owner of an account is another person, firm, company, organization
then detailed information of the beneficial owners is to be taken from the customer
and updated in Finacle CBS.
• In case of Nepal Government or Offices / Institutions under Nepal Government,
Institutions established under Special Law, Licensed Financial Institutions by NRB,
Insurance companies, United Nations or its offices and Special Institutions and
International Institutions and Foreign Embassies, account can be opened on the basis
of request letter, AOF and KYC of authorized signatories only i.e. without obtaining
registration certificate, PAN and KYC of all the directors and shareholders holding 10%
or above ownership.
• Risk Categorization of all the accounts opened is to be done as per the AML / CFT
Policy/Procedures of the Bank and NRB Circulars on the basis of nature of business,
association with political party, high level position, estimated transaction volume etc.
• Each account should be immediately categorized to applicable risk grade as per
AML/CFT Policy/Procedures. No accounts shall remain with blank risk grade/profile
in AOF as well as CBS.
• CDD is to be conducted for low-risk and medium risk customers. Similarly,
Enhanced CDD is to be conducted to high-risk accounts. The time interval for
conducting CDD or ECDD according to risk grade of the account has been prescribed
in AML/CFT Policy/Procedures of the bank, which is to be complied strictly by
branches. Branches should insert the correct customer types while opening the
accounts. Branches should insert NRB Customer type under “NRB Customer Type”
field in MIS code tab in the Deposit accounts and respective field in the Loan
accounts as well.
• Branches should insert the correct nominee account in Fixed Deposit as well as in
Loan accounts respectively.
• Branches should compulsorily verify that all the required documents for opening
account have been obtained and information related to AOF and KYC forms have
been completely filled by the customers before providing cheque book or at the time
of providing other banking products and services to him/her (e.g. ATM Cards, Mobile
Banking, Locker, E-Banking, Cheque Book / Statement / Balance Certificate / Good
For Payment Cheque Issue, Renewal of Fixed Deposits etc).
• Branches should insert the correct customer types while opening the accounts. Branches
should insert NRB Customer type under “NRB Customer Type” field in MIS code tab in the
Deposit accounts and respective field in the Loan accounts as well
• Branches should insert CDD/ECDD review date in “ECDD/CDD Update Date (DD-
MM-YYYY BS)” field under MIS Codes tab of Finacle after CDD/ECDD review is
done for a particular account on periodic basis as per its risk category and required
frequency of CDD/ECDD. In case of KYC update, it should be inserted in “Normal
KYC Update Date (DD-MM-YYYY BS)” field under MIS Codes tab of Finacle.
Further for changing Risk grading, Branch should go to CRM module, edit the CIF,

18
change “Risk Grade”, “Sub Risk Grade”, “Risk Rating” fields, select “Submit for
KYC field” as “Y” and ensure Suggested Process Name is
“CIFCustomerApprovalEdit/KYC-10.2” while submitting for edit. Further after
editing the CIF, branch should ensure KYC date and KYC review date is updated by
system.
• In addition to Branch Managers, branches should appoint an AML/CFT Compliance
Staff who shall report to AML/CFT Compliance Officer Head Office on AML/CFT
issues and Suspicious Transactions on periodic basis as required by AML/CFT
Policy/Procedures/Circulars.
• Branches should compulsorily fill all the sections of client details in a system, i.e.
Finacle-CRM module and Fincore account level, while opening an account. BM/
ABM/OI/Head CSD should approve the newly opened accounts only after verifying
that all the fields of client details in a system have been inserted with necessary
information supplied by the customers.
1.2.3 Online Account Opening
Online Account Opening module is an online medium of opening account in a bank. It is a
digital platform by which an individual can visit our bank‟s official website
www.ctznbank.com and follow a series of steps to fill up online account opening form and
open account in our bank. It provides convenience to customers to open an account in our
bank form from their home, office or anywhere at any time, without having to be in a queue
at the branch.
Our bank‟s online account opening module is not only easy, but also comprehensive that
allows the applicant to stay in the form and complete it or save it as draft and come back later
to complete the form. At present, our online account bank form only allows applicants to
open savings account schemes of the bank in either NPR or USD currency.
 For opening the account online, the applicant visits our bank‟s official site https://
www.ctznbank.com and selects Online Account Open under Online Products menu. The
applicant will be directed to the page containing various savings account products of the
bank. The customer can click on View More tab to view key features of the available
savings scheme. After choosing the Savings account scheme as per their need, the
customer will click on Apply Now tab to apply to open account.
 The applicant will be directed to online Account Opening Form. This page asks the
applicant to fill up basic information such as Applicant Type, Salutation, Applying from
Inside or Outside Country, Name, DOB, Email Address, Phone Number, Mobile
Number, and Applying from Country. After filling up this information, the applicant
has to enter the Captcha shown on the left bottom of the page and click on Proceed to
Account Opening Form tab. Once all the information is validated, customer will get an
OTP in his/her email ID and will be asked to enter the OTP to proceed to fill up the form.

19
 After verifying the entered OTP, customer will be guided through series of steps
containing pages with headings such as Personal information, Professional Details,
Identity Verification, Other Details and Terms and Conditions.
 Once the customers fill up all the required data in online account opening module, the
staff of Central Operations reviews the form in the backend of the module to check if any
details or documents are missing in the form. If the form is found to be complete, the
concerned staff of the department shall forward the form to the concerned branch at
which the customer had applied to open the account.
 After receiving the online account opening form received from Central Operations, the
branch needs to upload the data and documents in Account Opening DMS of the bank for
forwarding it to Central Account Processing to open the account. The branch then prints
the online account opening form and identification documents of the customers for filing.
After the account number is received from CAP, it should be conveyed to the customer
by sending Account Opening Advice.
 The account opened under non-face-to-face basis falls under high-risk category as per
AML/CFT Policy/Procedures of the bank and branch should categorize the account under
high risk. However, since online opening requests are forwarded by Central Operations
Department to branches, there is no need to take approval for opening account through
online request.
 Hence, after opening the account through online medium, the customer needs to visit the
branch and complete all account opening formalities such as affixing signature and
thumb impression, submitting original ID for verification and 2 pp sized photographs.
Until then, the account is to be debit restricted and only credit transactions are to be
allowed in the account. However, the customer can avail mobile banking and internet
banking facility with inquiry rights only.
Once the customer visits the branch, there is no need to fill up new AOF or KYC forms as
online account opening form itself is a complete form incorporating required details of
both AOF and KYC forms. Hence, once the customer visits the branch, his/her signature be
obtained at the bottom of each page of online account opening form. Further, the
customer‟s signature and thumb impression are to be obtained in specimen signature card.
Similarly, the copy of identification documents is to be verified with the original copy.
However, if any of the document submitted by the customer is found to be incomplete, or
unclear, the branch can obtain another copy of the original documents.
1.2.4 Online Account Opening Through Nagarik Application
Nagarik App is a mobile application launched by the Government of Nepal to provide
various government related services in a single online platform. Various personal
identification documents such as Citizenship Certificate, PAN, Driving License, Voter‟s
ID Card, Citizen Investment Trust card etc. can be registered and various information

20
related to local government, taxes submitted, services related to Citizen Investment Trust,
Police clearance report, Land ownership, Health Insurance Board, Educational details etc.
can be viewed from this app.
Similar to online account opening product, Online Account Opening Through Nagarik
App is also an online medium for opening account with the bank. However, the main
difference is that in this module, instead of generating OTP, in this module verification is
done by scanning QR Code generated by the module through the QR Code scanner of
Nagarik App. Moreover, various identification details of the customer that are already
present in the Nagarik App gets self-populated in the module and hence the customer has
to fill up less information when opening account through this module and the information
available in the Nagarik App is more reliable.
Hence, for opening an account through this online medium, the customer should have
Nagarik App installed in his/her mobile phone or PC.
For filling up online account opening form through this app, a customer has to visit our
bank‟s official website https://www.ctznbank.com and select Online Account Opening
using Nagarik App under Online Products. Then, he/she has to scan QR code generated in
the module with QR code scanner of the app. Then after, the applicant has to select the
account scheme of his/her choice and follow a series of steps containing pages such as
Personal Details, Professional Details, Other Details, Verification etc. to apply for opening
account in our bank. This product also allows the applicant to stay in the form and
complete it or save it as draft and come back later for completion. An account can be
opened through Nagarik App with verification from Citizenship or Passport. In case of
verification with Voters‟ ID or other documents, inputting details of citizenship certificate
or passport and uploading one of these documents is compulsory.
The online account opening requests through Nagarik app are also received by Central
Operations Department and after properly verifying the documents and other details
submitted, they will forward the request to concerned branch. After receiving the request
by the branch, they need to upload the account opening details and information in the
Account Opening DMS to open the account through CAP Unit. After account number is
generated, the branch needs to convey the account number to the customer and print the
online account opening request form and file it properly. In this case also, until the
customer personally visits the branch to complete the account opening process and
submits original documents, the account should be debit restricted.
The online account opening through Nagarik app is being developed in such a way that the
information filled up by the customer gets updated in the Finacle CBS and account
number is generated automatically by the system. Once this project is completed, accounts
will be opened automatically with very few manual transactions.

21
1.2.4 Online KYC Update
E-KYC or Online KYC module provides an online platform to individual customers to
update their KYC details at the bank.
The E-KYC module involves series of steps through which the customer first needs to
input data to verify themselves as account holder of the bank and then proceed to update
their KYC details of their account. The module provides the customer with two options to
choose from to validate their identity before allowing him/her to proceed to view existing
KYC details and update them. The first option verifies the customer based on Account
Number and Mobile Number, while the second option verifies the customer based on
Account Number, Citizenship Number, Date of birth and Grandfather‟s name.
Once validation process is completed, the customer is diverted to online KYC form in
which their previous data present in our CBS is displayed and those data that are to be
filled up appear blank. Customers are required to fill up all the necessary fields that have
been marked as mandatory fields.
Once the E-KYC form is completely filled up, the customer can submit the online form.
The submitted E-KYC forms then after appears in the backend portal of the module,
which will be operated by the staffs of Central Operations Department. The E-KYC
forms are thoroughly checked by the staffs to ensure they are filled up by account holder
himself/herself and the customer has submitted complete set of document to update their
KYC. Once the Approver user approves the E-KYC form, the updated fields are directly
updated in the CBS of the bank.
The concerned branch is then sent notification mentioning that the CIF ID of their
customer has been updated in the system through E-KYC module and the digital copy of
KYC form is attached with the mail. The branch then needs to print the updated KYC
form and file it inside the Account Opening form of the concerned account.
1.3. Maintenance of Account opened
CSD shall work on behalf of the bank to provide assistance on the customer‟s account. Any
changes/amendments in the account and its details need to be incorporated by CSD upon
receipt of a written application from a customer. CSD needs to be equipped with sufficient
manpower and system in order to deal with following work areas:
1.3.1. Cheque Books
The main stock of cheque book remains in the control of General Service Department
(GSD), HO. After the cheque book stock is sent by GSD to a branch, it needs to transfer the
cheque from External location to Branch location (Double Lock) in Finacle CBS and then to
respective employee of branch as required based on nature of inventory. Each step needs
dual authentication and enterer and verifier need to check physical inventory number while
entering the same in CBS Finacle. Cheque needs to be segregated as normal cheque and
loose cheque and is to be assigned to individual employee. Manger‟s Cheque and Fixed

22
Deposit Receipt need to be assigned to branch‟s Double Lock only. A proper stock of each
inventory item needs to be maintained by branch and same is to be updated in stock registers
(Specimen 59). Stock needs to be reconciled daily or on need basis as per security item.
• The cheque book should only be issued in following conditions:
• All the required documents and photographs for opening the account have been
obtained and AOF and KYC forms have been completely filled up.
• The customer has maintained minimum balance in the account.
• The image (signature/thumb impression/stamp/photograph) of the account has been
uploaded in the system.
• The AOF and KYC forms have been approved by the Branch
Manager/ABM/OI/Head CSD.
• The cheque book should only be issued against Cheque Requisition Form (Specimen 3) or
cheque request mentioned in AOF for the first time after opening account and Cheque
Requisition Slip (Specimen 7) then after.
• To avoid issuance of any unauthorized cheque book, the concerned staff should note that
they must mention following information on the overleaf of cheque requisition slip.
i. Account name and account number of the customer.
ii. Serial nos. in range of the cheque book issued.
iii. Cheque book issued date.
iii. Bank seal and full signature of the issuing authority.
• Cheque book is to be issued on presentation of requisition slip from the old cheque book
issued to the client and only after verifying the above particulars and authorized signature.
• Before issuance of cheque book the following factors should be considered:
i. If cheque book is to be issued against Cheque Requisition Form/Slip verify that
the form is presented by the person to whom such form/slip is issued by
demanding reliable ID documents or by other appropriate means.
ii. Verify the signature of the customer on the cheque book requisition form/slip.
iii. If the customer does not appear in person, see that the account holder has
authorized an agent and sample signature of the agent has also been mentioned.
iv. Verify the signature of the account holder from the system and of the agent on
the basis of specimen signature provided in the requisition slip.
v. Check the stock of valid cheque leaves of previous cheque book in the system.
If there are sufficient number of previous unused cheques, make necessary
enquiries with the customer to ascertain the genuineness of request & forward
the case to OI/ABM/Branch Manager (BM) for approval.
vi. Before issuance of new cheques, check in system as well as in register if there
are any previously issued uncollected cheque book of the same account. If
previous cheque is found, such uncollected cheques should be provided to
customer instead of issuing new one.
• All the printed cheque books that remain uncollected should be kept inside the cash vault at
the end of the day and taken out in the morning of the next day on daily basis.
• If the person other than the Account Holder comes to collect the cheque book on behalf of
the Account Holder, then the cheque book should be issued only after obtaining a copy of

23
identity of the person visiting the bank to collect the cheque book and authorization of
Account Holder. The concerned staff may contact the customer for confirming the
genuineness of cheque printing request if felt necessary.
• Entries in the Cheque Book Issue Register (Specimen 8) should be made compulsorily at
the time of issuing of cheque book. The signature of a recipient will be obtained in this
register as a token of having received the cheque book. The issuer of cheque book will
ascertain that signature placed on the cheque issue register is the same as placed in cheque
book requisition form.
• While delivering the cheque book to the client, he should be asked to count the leaves
before acknowledging it.
• All the documents received for the issuance of cheque book i.e. cheque book requisition
form/slip, identification etc. will be attached together and kept in a separate file.
• At the end of the day, the Head CSD/OI should check the following particulars and then
approve the cheque issue in the Finacle System:
i. Particulars mentioned in the register are true.
ii. The new serial no. of cheques (as of stock inventory system) has been fed in the
computer.
iii. The cheque book requisition form/slip submitted for issuance of cheque book belongs
to the person requesting the issuance of cheque book.
• The departmental stock of cheque books should be tallied daily by the custodian.
• If any person visits the bank to collect the cheque book after 2/3 days of cheque book
requisition date, the issuing authority should confirm the genuineness of the person and
his/her signature should be verified.
• If there is any mistake in printing of cheque(s) or if the cheque(s) becomes invalid in any
other way before or after the issuance, then details should be made in Cheque Book Issue
Register with appropriate remarks, if cheque is found void after saving it in the system,
record should be made in separate Void Cheque Register (Specimen 9).
• The record should be maintained in separate Void Cheque Register, if the cheque found
void before saving the cheques in a system and by other means.
• All such void cheque books should be filed in a separate index file for future reference and
should be placed inside vault room.
• Such void cheques will be destroyed after verifying in the presence of the representative
required for destruction on uncollected cheques.
1.3.1.1. Uncollected Cheque Books
 If any cheque book has been printed but not collected by the account holder within 90 days,
the cheque book needs to be transferred to a separate fireproof cabinet or vault and remarks
of such transfer should be made in cheque book issue register with signature of concerned
staff/s.
 If any cheque book remains uncollected for more than 1 year after being printed, due to any
reason such as the customer being out of contact, customer is staying in foreign country etc.
the cheque book should be destroyed by the branch. The charge as per the standard
schedule of charges have to be recovered.

24
 When a cheque issuing request is received from a customer, the branch needs to check in
the system and cheque book register about whether previously issued cheque book of the
account has remained uncollected by the customer. If there is uncollected cheque book, the
old cheque book should be provided to the customer instead of issuing new cheque book.
 For disposal of the cheque book, following conditions should be met:
 The statement of account is scrutinized and the movement of account justifies for
disposal of cheque books.
 The customer has been contacted over telephone and causes for not collecting the
cheque book have been identified.
 In absence of contact number or if the customer could not be contacted over
telephone, a written information has been sent to the customer and if the customer
does not reply within a period of a week.
• Before destroying the uncollected/ damaged cheque book an inventory of cheque book
should be prepared. Cheque number shown as valid in the inventory of the banking system
should be marked Invalid before destroying the cheque books of respective account holders.
The justification to destroy these cheque books should also be mentioned in the inventory
list. The inventory should be prepared in the following format:
 Cheque requisition date
 Cheque number (From ___ to ___)
 Account number
 Account title
 Justification
• Cheque book can be destroyed in the presence of following representatives of the bank:
 Branch Manager
 CSD staff
 Operation In-charge/Head CSD.
 Representative from Internal Audit Department
• After destroying the cheque book, the signature of all the representatives as stated above
will be obtained. The signed inventory of destroyed cheques will be kept in record by the
concerned Department/Branch for future reference.
1.3.1.2. Issuing of Cross Branch Cheque Book
With the objective of providing additional facility to our valued customers, enabled by
Finacle CBS system, branches can issue cheque book of customers, who are
maintaining account in another branch. However, the risk associated with providing
this service cannot be ignored. This is due to the fact that the branch issuing the
cheque book may not know the customer very well and there is high risk of forgery of
signature in cheque requisition slip that may have been lost by the account holder or a
dispute may have aroused among authorized signatories of a company. Cheque book
acquired against cheque requisition slip with forged signature may result in financial

25
loss to the customer and customer may claim to make over the loss if there is any
negligence on the part of the bank while issuing cheque book.
Hence, a standard procedure as explained below has been placed that needs to be
followed by branches for providing cross branch cheque issuance facility to the
customers by minimizing associated risks:
 When a customer of one branch approaches another branch for issuing a cross
branch cheque, the branch needs to verify that the person visiting the branch is the
account holder himself/herself in case of account of an individual or one of the
authorized signatories in case of a firm/company. In special cases and only if the
account belongs to a large company or a high profile person, an agent may be
appointed for collecting the cheques. In such case, the cheque requisition slip also
needs be accompanied by a request letter of the individual/company having
signature/s of the authorized signatory/ies and a valid ID card of the agent.
 The cheque requisition slip should be filled up and signed by the required number
of signatories according to the account operating instruction available in the
image of the account in Finacle CBS. The branch needs to verify the signature
done on the cheque requisition slip and Signature Verified stamp is to be affixed.
 The branch also needs to obtain a valid ID card, preferably citizenship certificate
or passport, of the account holder/authorized signatory and that of an agent in case
agent has been appointed by any company to collected the cheque. The copy of
the ID card needs to be verified with the original copy and Verified with Original
stamp needs to be affixed.
 In case of authorized signatory, branch also needs to verify his/her identity
through photograph available in the image of Finacle CBS as well as by asking
questions related to his/her personal information and then verifying the answers
with the details of account holder/authorized signatory available in the CIF ID in
Finacle such as address, date of birth, name of grandfather etc.
 After verifying these documents, the branch forwards the request to the account
maintaining branch for getting their consent through email by attaching cheque
requisition slip and copy of identity card obtained thereof. Such request is to be
forwarded by Operations In-charge, ABM or BM or at least Supervisor level staff.
 When sending request to account maintaining branch, the cheque printing branch
should also provide confirmation as “We confirm that the customer has personally
visited our branch and we have verified his/her identity through signature,
photograph and cross checked his/her personal details with details present in
Finacle CBS”.
 If the account belongs to joint individual or a firm/company, instead of
mentioning just customer, the cheque printing branch should clearly mention if
the cheque collecting person is one of the authorized signatories of the account or
an agent.
 When the account maintaining branch receives such request, they should check
AOF and KYC forms and supporting documents of the account to ensure all

26
documents are up to date. If they found that the account is dormant, some
documents are missing or KYC is to be updated for CDD/ECDD etc., they would
request the cheque book printing branch to provide completely filled up new KYC
form with photograph and missing documents, if any, and/or account activation
request form of the customer.
 Upon getting such request, the cheque book printing branch should provide the
required documents by sending scanned copy of the documents for cheque
printing process and then later send the original documents through courier
without fail.
 The account maintaining branch should also contact the account holder/authorized
signatory through phone/mobile number mentioned in the system to confirm the
authentication of the request.
 If all the documents are found up to date and the customer confirms over
telephone that the request has actually been made by him/her/them, the account
maintaining branch should provide consent to the cheque book printing branch by
providing confirmation as, “We confirm that we have checked all the AOF
documents including KYC of this account and found them in good condition and
updated. Further, we also confirm that we have contacted the account
holder/authorized signatory and verified that the cheque printing request is
genuine”. Such confirmation is to be provided in reply mail by Operations In-
charge, ABM or BM or at least Supervisor level staff.
 After receiving consent from the account maintaining branch, the cheque printing
branch can then proceed to print the cheque book by following normal procedures
of cheque printing.
 Both branches need to keep a copy of the email conversation done between the
two branches regarding consent/confirmation provided from each other‟s side in
record along with cheque requisition slip and identification document. A separate
file can be maintained to keep record of all the cross-branch cheque books issued
by the branch.
 If the old cheque book or only cheque requisition slip has been lost by the
customer, the cheque printing branch should obtain cheque book lost charge as
per our standard charges and follow the procedures as mentioned in serial no.
1.3.1.2. Both cheque printing branch and account maintaining branch should be
extra cautious in case the customer claims to have lost previous cheque book or
cheque requisition slip to ensure that the cheque book is not issued to an
unauthorized person.
Note: If the cross-branch cheque is to be printed of Staff account, consent of cheque book
maintaining branch is not required. The cheque book printing branch can directly print the
cheque book by obtaining cheque requisition slip from the concerned staff and verifying
his/her signature. However, all staffs should ensure that they have submitted a completely
filled up AOF, KYC form, identification document and photograph to the account
maintaining branch (Durbarmarg Branch). The staffs can also update their KYC
information through E-KYC service.

27
1.3.1.2 Procedures for Issuing Cheque Book against Lost Cheque Book.
If the customer has lost previously issued cheque book, he/she/they will inform the
same to the bank through application (Specimen 64) mentioning details of cheques to
be stopped/destroyed. Extra precaution is to be taken for issue of a cheque book in
absence of the requisition slip. There may be numerous causes for non-presentation of
requisition slip i.e. cheque book itself may have been lost or requisition form duly filled
in may have been misplaced etc. To avoid any possible loss to the bank, following
precautions should be taken.
• In case of individual A/C, the individual must himself visit the bank with the formal
request letter. The cheque book should be issued only to the concerned account holder
after verifying personal identification like original citizenship certificate, license etc.
• In case of corporate and other clients, a formal request letter to issue the cheque book in
absence of requisition slip should be obtained containing signature/s of the authorized
signatory/ies and stamp as per specimen of the account. The authorization letter should
also specify name and specimen signature of the authorized person collecting the
cheque.
a. An identification proof of the authorized person should also be obtained.
b. The issue of cheque book in absence of requisition slip will be made only after
telephonic confirmation from the client.
• All such cases will be brought to the notice of the Branch Manager, with the signature
of BM/ABM/Operation In-charge.
• If the cheque requisition slip was not produced in the pretext that the cheque book was
lost, all the unused cheques should be stopped immediately and indemnity form should
be obtained from the customer. The account holder should mention the cheque numbers
that has already been issued by them and need not be stopped in the request letter.
• In case of loss of cheque book having joint accounts, the request letter should be signed
by the authorized persons as per the application form and any one of the authorized
persons should personally visit the bank for obtaining new cheque book.
• The loss of cheque requisition slip alone should also be treated as cheque book lost case
and applicable charges should be deducted from account as per bank‟s schedule of
charges.
1.3.1.3 Cheque Book Printing in Restricted accounts
If the reason from the account restrictions is due to dormancy, deceased, account
blocked by CIAA or any other government entities/ law enforcement agencies, etc., the
cheque book can be printed only after such restriction is released.
1.3.2. Loose Cheques
• If a customer is in emergency need of fund, but has forgotten to bring his/her cheque
book and ATM or has brought only his/her ATM, but there is problem in the ATM. In
such emergency circumstances, bank may issue a single cheque, called as loose cheque,
to the a/c holder allowing him/her to withdraw money from his account.

28
• The issue of loose cheques should be discouraged as far as possible. If it is unavoidable,
it can only be issued to the customer after taking consent from BM/ABM/OI of the a/c
maintaining branch by forwarding application submitted by him/her (Specimen 16).
• The purpose to withdraw cash through loose cheque should be justifiable and amount
requested for withdrawal should be reasonable according to purpose mentioned. Under
normal circumstances, the amount of loose cheque should not exceed Rs.500,000.00. In
special cases, if customer requests to pay amount higher than Rs.500,000.00, approval is
to be obtained from COO or higher authorities by forwarding the application of the
customer with signature verified.
• The loose cheque can be used both for withdrawing cash or transferring fund to another
account.
• Account holder should be self-present for requesting issuance of loose cheque and
his/her signature in the application should be verified by affixing signature verified
stamp.
• All the entries in Loose-Cheque-Issued Register (Specimen 17) should be made by the
staff concerned.
• Number of loose cheque/s issued will be filled in by the staff of CSD and receipt of
cheque must be acknowledged by the account holder on the register.
• Payment of huge amount through loose cheques should be discouraged as far as possible
and loose cheques should not be issued to the same customer time and again.
1.3.3. Withdrawal Slip
 Withdrawal Slip is another banking instrument that allows customer to withdraw money
from his account without cheque book.
 However, whereas serial number of cheque books are recorded in the system and linked
to an account when cheques are issued to a customer, withdrawal slip does not have a
serial number and is not linked to any particular account.
 Due of this, there is high risk of forgery of signature if withdrawal is allowed through
withdrawal slip without properly verifying the identity of customer.
 Hence, withdrawing from account using withdrawal slip should be allowed only in case
of emergency circumstances such as the following:
 Customer wanted to withdraw money from ATM, but ATM is not working or
there is technical problem in the ATM card issued to the customer.
 Customer has faced medical emergency and wants to withdraw money to make
payment to hospital/clinic/pharmacy etc.,
 Any other emergency circumstances faced by the customer that justify issuing
of withdrawal slip to withdraw money from account due to absence of cheque
book.
 Considering the risk associated with issuing withdrawal slip, maximum withdrawal
amount that can be allowed using withdrawal slip should be NPR 25,000/- and
approval of the BM or OI is to be taken for transactions done through withdrawal slips.

29
 In case of any emergency circumstances that justify customer‟s request to withdraw
amount above NPR 25,000/-, request for approval is to be forwarded to Central
Operations Department for taking approval from COO or higher authorities.
 Withdrawal slip should only be allowed to retail customers (account of an individual)
and not to corporate customers (account of firm/company).
 Due to inherent risk, withdrawal slip should only be allowed as last resort and
customer should be asked to use Digital Teller service or issue Loose Cheque as far as
possible.
 Applicable charge for issuing withdrawal slip is to be recovered from customer as per
bank‟s standard fees and commission.
1.3.4. Fund Transfer Form
Fund Transfer form is a banking instrument allowing customer to transfer fund from
one account to another without the use of cheque book.
 However, similar to withdrawal slip, this instrument is not registered in the CBS like
cheque book and is therefore less secured.
 Hence, transfer of fund through account transfer form should only be allowed only in
case of emergency need to transfer of fund between accounts in absence of cheque
book.
 The transfer of fund through account transfer form should only be allowed to transfer
fund up to Rs.200,000.00.
 If the request of transferring of fund above Rs.200,000/- is found genuine and
justifiable to the BM/OI, he/she can forward the request to Central Operations
Department for taking approval from COO or higher authorities.
 The aforementioned limit for transferring fund between two accounts is not applicable
if the fund transfer is being made for opening Fixed Deposit account.
 The branch should still insist their customers to provide cheque book or avail Loose
Cheque facility for making the fund transfer as far as possible.
 Applicable charge for issuing withdrawal slip is to be recovered from customer as per
bank‟s standard fees and commission.
1.3.5. Statement of Accounts
• Statements of accounts will be handed to the customers on their demand. For this,
Statement Request Form (Specimen 10) should be filled up by the customers.
• In case the a/c holder sends an agent, on his/her/their behalf, to collect the statement, the
signature of the a/c holder in the Statement Request Form should be duly verified and a
copy of identity card, duly verified with the original, of the agent should to be obtained.
The statement of account will be then printed and handed over to the agent after
obtaining agent‟s signature in the Statement Record Register (Specimen 11).
• Statement Record Register is to be maintained for every issuance of statement in order
to keep the records of the statement collected by the customers.
• In the self-presence of the customer and after properly verifying his account details and
signature on the Statement Request Form, Cross Branch Statement could be issued.

30
• The statement printing date must be modified in the system after successfully printing
the statement. If the customers want to re-print the previous printed statement, then the
necessary charge should be deducted from the account.
• In case, a/c holders request for making delivery of statement of account through post
or email, the account statement of such accounts are to be generated periodically as
advised in the account opening form, and posted to the customer‟s address or email ID.
The email ID in such case must be registered at the bank.
• If any statement is returned undelivered, the same is to be handed over to Customer
Service Department who should contact the client over phone and the same should be
noted in a register keeping the Envelope intact for showing it to the client. Also, the
particulars of such return will be mentioned in computer so that we could contact the
account holder when he/ she visit the Bank later. On return of statement of account, the
staff in CSD should make necessary changes in the computer so as to discontinue the
generation of statement of account with wrong/ incomplete address.
• If the customer later visits the bank and request in writing to dispatch the statements by
post again, the request should be honored after ascertaining the actual cause of return of
statement.
• Blank or printed account statement papers must be handled properly and should be kept
into the fire proof cabinet/vault at the end of each day to minimize the risk of misuse of
bank's property.
1.3.6. Balance Certificate
• Balance Certificate is a document issued by a bank certifying the available balance in
the account of the customer on a particular date, often mentioning the a/c balance in
equivalent FCY amount. Balance Certificates are issued to account holders only on
their specific written request (Specimen 12). It can be also delivered to any person
assigned by him/her by obtaining a written request and a valid ID card.
Acknowledgment of the receipt of the balance certificate is to be obtained from the
receiver through signature done on the duplicate copy of the same. These duplicate
copies are to be retained by the CSD for record.
• Balance certificate can be issued for a single account or multiple accounts (including
Fixed Deposit accounts) on the basis of CIF ID of the same customer.
• The balance certificate is to be issued in the letter head of the bank and should be
signed by two authorized signatories of the branch by affixing bank stamp.
• Branches could issue balance certificate of customers maintaining account at another
branch only after ensuring that the account holder is self-present and his identity has
been verified through photograph, signature, ID card etc. A copy of ID card is to be
kept in record after verifying it with the original. Moreover, consent of the account
maintaining branch is also to be obtained through email, by attaching balance
certificate application form of the customer. A confirmation from the branch is also to
be obtained about whether the balance certificate had been issued of the same account
within a Nepali month or not to determine if balance reconfirmation charge is
applicable.

31
• The account maintaining branch after receiving such request from another branch
should first check if any documents is pending in the account. If all the required KYC
documents are up to date and intact, they should verify the signature done in the
application form. They should also check if the balance certificate has already been
issued from the account in the same Nepali month. All these processes should be
carried out and reply to be sent to that branch as soon as possible.
• If a customized or manually prepared Balance Certificate (i.e., other than system
generated one) is to be issued by the branch, they should take approval of COO or
higher authorities by sending the request to Central Operations Department.
• Certificate issue charge, as per our standard fees and commission, is to be obtained for
customized or manually prepared Balance Certificate (i.e., other than system
generated). Similarly, Balance Reconfirmation charge, as per our standard fees and
commission, is to be obtained for each copy if more than one balance certificate is to
be issued from the same account within one month as per Nepali calendar.
1.3.7. Advance Payment Certificate
Advance Payment Certificate (APC) is a certificate issued by the bank in favour of a
customs office stating details of advance payment in foreign currency credited in the
account of the customer involved in export trade. Nepali firm/company involved in
export of various goods often receive advance payment from their customers (buyers)
situated in foreign countries for the confirmation of foreign trade.
Advance Payment Certificate can be issued on the basis of following conditions:
 An application in the prescribed format of (Specimen 83) is to be obtained from the
customer.
 The customer must disclose the details of goods being exported, its unit price, total
price, name and address of the imported etc. in their request letter. A sales contract
or pro-forma invoice issued by the customer to the importer should be obtained, if
any.
 The advance payment in FCY amount can be received through SWIFT, online
payment through debit/credit card.
 The advance payment in FCY amount can also be received in cash from a foreigner
on the basis of sales agreement, invoice on the terms that the goods will be
delivered by the Nepali firm/company to the foreign address of the foreigner.
Passport and VISA of the foreigner should also be obtained for this purpose. If the
cash amount exceeds USD 5,000/- or equivalent other convertible currency, a copy
of declaration submitted by the foreigner at the customs office must also be
obtained.
 If the customer fails to provide details and supporting documents for the purpose of
issuing APC, in their request letter, a declaration is to be obtained from the
customer that they would take the full responsibility for the issue of APC on their
request.

32
 After the request letter and supporting documents of export trade are submitted by
the customer and amount of FCY amount credited in the account is verified by the
branch, the branch can issue Advance Payment Certificate in the specified format
(Specimen 84). For this, the branch needs to obtain Inward SWIFT received copy
from SWIFT Unit of Finance Department to verify the details of the remitter and
purpose of payment. If any invoice number or sales agreement reference number
has been mentioned in the SWIFT copy, a copy of such invoice/agreement should
also be obtained from the customer.
 Bank Code and reference number (Chalani Number) of the branch should be
mentioned in the Advance Payment Certificate and record of the APCs should be
maintained in serial wise manner in the Advance Payment Certificate Issue Register
(Specimen 82).
 The customer (exporter) has to request the bank for issuing APC within 4 months of
receipt of such advance payment. The validity period of the APC is 2 years from the
issue date. If the customer fails to export the goods within the validity period, on the
written request of the customer, the validity of the APC, for the amount remaining
to be exported, can be extended for the period of additional 1 year. If the customer
fails to export the goods within the extended period also, after obtaining a
declaration for the goods remained to be exported from both the importer and the
customer (exporter), the validity of the APC can be extended for additional 1 year.
 After issuing APC in favour of a customs office, if the customer requests in writing
to change the name of the customs office, the customer has to mention the reason
for the changing the customs office and provide declaration that they shall be fully
responsible for changing the name of the customs office for issuing APC. The
original copy of the previously issued APC is to be obtained from the customer
before issuing a new one.
The procedure for issuing Advance Payment Certificate is subject to other provisions
mentioned in the NRB‟s Unified FXM Circular no. 05/2078, serial no. 1 and
amendments made by NRB from time to time.
1.3.8. Incentive for Export
In order to make domestic products export-oriented and to reduce the imbalance in
foreign trade by promoting exports, the Government of Nepal has approved the
amendment to the „Procedures Related to Providing Subsidies to Exporters 2075‟ to make
the subsidies provided by the Government of Nepal to exporters systematic, transparent,
simple and effective.
To ease out the process of getting cash incentive against export, the exporter can apply
for getting the incentive from any commercial banks at which they have been maintaining
account and had received payment (in advance or on credit) in by submitting required

33
documents mentioned in the Procedures Related to Providing Subsidies to Exporters
2075.
Arrangements for Providing Export Incentive
 The application for requesting export incentive should be submitted at the same bank
where payment, whether in advance or on credit, for the export of goods, had been
received.
 The exchange rate published by Nepal Rastra Bank on the date when the payment
against the export of goods had been credited in to the account of the exporter is to
be considered for converting the FCY amount (including INR) to NPR currency to
calculate the amount of goods exported.
 The type of goods for the export of which export incentive can be claimed have been
divided into two categories in Annexure 1 and Annexure 2. Goods falling under
Annexure 1 is eligible of getting export incentive of 5% of the amount of exported
goods and goods falling under Annexure 2 is eligible for export incentive of 3%.
 The value addition on goods falling under Annexure 1 should be at least 50% and
goods falling under Annexure 2 should be at least 30 %.
 Goods falling under Annexure 1 is eligible to get additional 1% incentive if the value
addition on the goods is at least 40% and if the goods have been exported with a
registered national level trade mark.
 If the value addition of goods falling under Annexure 1 is less than 50%, export
incentive of 3% will be applicable. Similarly, if value addition of goods falling under
Annexure 2 is 50% of above, export incentive of 5% will be applicable.
 The application for export incentive should be put up for approval to Nepal Rastra
Bank within 60 days from the date of export.
Following documents are to be submitted at the bank to apply for Cash Incentive
 Application in the format provided in Annexure 4 of Procedures.
 Registration Certificate and PAN Card
 Tax Clearance Certificate of last fiscal year
 EXIM Code
 Customs release documents of export of goods such as Pragyan Patra,
Commercial Invoice, Certificate of Origin, Customs duty paid receipt etc.
 Advance Payment Certificate (APC) and Account Statement showing account
credit of foreign exchange amount related to export.
 Certificate of Department of Industry mentioning the value addition on the goods
being exported.
 After the required documents from the customer is received, branches need to send
the request for providing cash incentive to Head Office for taking approval from
competent higher authorities by routing the request through Central Operations
Department.

34
 After approval is obtained from competent authority, branch shall credit the export
incentive in the customer‟s account and claim the reimbursement of incentive
amount provided from NRB in the request letter as per the format mentioned in the
Annexure 5 of the Procedure.
Detail procedure for the management of Incentive for Export has been given in NRB‟s
FXM Unified Circular No. 06/2078 or its updated version.
1.3.9. Foreign Direct Investment Certificate
Foreign Direct Investment is the investment made by an individual/company of a
country in a firm/company located in another country, either partially or wholly
owning the shares of the firm/company. FDI is an important source of external
financing for a least developed country like Nepal. Along with financial resources,
FDI also facilitates the transfer of technology know-how, managerial and
organizational skills and access to foreign markets with enhancing productive
activities of the host economy. Nepal is also receiving various types of FDIs that
ranges from investment in a small firm to investment in large projects. These FDIs
are routed from banking channel, which has created role of the banks in the inflow
and accounting of FCY amount received through this channel.
Nepal Rastra Bank has enacted “Foreign Investment and Foreign Loan Management
By-law 2078” to frame various provisions regarding obtaining approval of foreign
investment, accounting of investment received, repatriation of return of investment,
obtaining approval of foreign loan, repayment of principal and interest amount.
Branches need to conform to the provisions given in the by-law to understand the role
of the banks for issuing Certificate of Inflow of Foreign Currency Pertaining to
Foreign Investment.
Here, some of the provisions related to management of foreign currency for FDIs that
are related to the bank have been discussed.
Sources of FDI can be the following:
 If the foreign creditor is a firm/company, net worth of the company as per it
latest audited financial reports, bank balance or unused amount of sanctioned
loan facility. (However, audited financials will not be necessary if the amount of
FDI is less than USD 1 million or equivalent other foreign currencies, or the
foreign company provides proof about audit of their financials is not necessary,
then financials prepared by their board or top management can be accepted.)
 If the foreign creditor is an individual, net worth of himself/herself or his/her
family members, bank balance or unused amount of sanctioned loan.

35
 If the foreign investment is being done in the share of a local company thus
changing its shareholding pattern, prior approval of NRB is mandatory before
such FDI amount is brought inside Nepal.
 If the foreign company wants to bring FCY amount for carrying out feasibility
study of the project/investment, prior approval of NRB is not required. The bank
should obtain application as per Annexure-1 of the by-law from the foreign
investor. This amount should not exceed 3% of the total paid up capital of the
company or industry, in which foreign investment is being made, to be counted in
FDI, but expenses from investment is to be certified by the auditor and its
accounting is done as per sub-rule no. 5.
 After the foreign investment is credited in the account, the foreign investor or the
invested company needs to obtain Foreign Direct Investment Certificate from the
bank at which the they have maintained their account and FDI have been
received. For this, the bank needs to obtain required documents of both foreign
investor and invested company mentioned in the Annexure 3. The certified copy
of the documents means that the copy documents are to be certified by Notary
Public. The FDI certificate is to be issued in the format mentioned in Annexure 5
of the by-law.
Please refer to Foreign Investment and Foreign Loan Management By-law 2078 for
detail provisions related to foreign investment, foreign loan management, repatriation
of income etc.
1.3.10. Change of Address, Contact Number and Nominee of Account
If the communication/permanent address of the account holder has changed, he/she/they
must request for changing their contact details in the account. Such request to change
his/her/their address/contact no., should be submitted to the bank in writing by disclosing
his/her/their present and changed address/contact no. On receipt of the application, the
following procedures will be adopted.
Verify the signature of the a/c holder on the application form as well as his/her/their
previous contact details.
• The request should be carefully read to understand if address, contact number or both
have been changed.
• Update the new address and/or contact number of the a/c holder in the system and
mention the date and details of the amendments made in the request letter of the
customer for record and signed by the CSD staff and OI/Head CSD. The request
letter of the customer should then be placed with the AOF.
• The new mobile number/email ID of the customer is to be updated in respective fields
of CIF ID in Finacle system. Similarly, after taking consent of the customer in writing,
it should also be updated in Mobile Banking, E-banking, Demat or any other types of

36
digital services that involves sending of OTPs or other notifications in mobile
numbers/email ID.
• Before verifying the change made in the contact address in the system, the
Supervisor/Head of the CSD/ Operation In-charge should properly check to ensure
that correct changes have been fed into the system. After checking, he/she will put
his/her signature as a mark of such checking and will keep the form serially in the
account opening file.
• Also, if the account holder desires to change the nominee in due course of time, s/he
should request in writing disclosing details of the new nominee and removal of the
previously provided nominee of the account. On receipt of the application, the
following procedures will be adopted.
Verify the signature of the client on the application form.
• Feed new nominee details in the system.
• Obtain valid ID card of the new nominee.
• At the end of day, the supervisor / Head of the CSD/Operation In-charge should
check into the system to ensure that the correct change has been fed into the computer.
After checking, he/she should put his/her signature as a mark of such checking and
will keep the form serially in the account opening file.
1.3.11. Change of Signature/ Stamp
a. Individual/Proprietorship Firm/Partnership Firm
• In case an individual or a Proprietor of Proprietorship Firm desires to change the
existing signature(s), the account holder (individual/Proprietor) should personally visit
the bank and a request in this regard should be made in writing.
• In case of Partnership firm, consent of all the partners is to be obtained in writing to
change the signature.
• The staff of CSD will verify the signature(s) on the request letter and after ascertaining
the genuineness of the applicant, will hand over SS cards for obtaining fresh specimen
signature(s).
• The staff of CSD will then feed the new signature/s into the system mentioning
effective date applicable of the new signature as request letter date. The Operation In-
charge/Head CSD will verify the new signature after properly checking the documents
received. Both CSD staff and Operation In-charge then affix their signatures in the
respective fields of SS card and keep it properly in the account opening form.
• If a mandatee wants to change his/her signature, he/she should personally visit the bank
and request in writing for a signature change.
b. Corporate and other clients
• In case of corporate and other clients, an application on the letter pad of the client will
be obtained. If the person whose signature is to be changed could not attend, an

37
authorization letter and an identity of the authorized person will be obtained from the
person who visits the bank with such request. Bank will also depute a signatory who
will obtain fresh signatures on SS cards in his presence and admit the same.
• The request letter for the change of signature must be supported by a resolution passed
by the competent authorities. If there is any doubt about the genuineness of the
application, the same may be directly confirmed with the client on telephone.
• SS Card after scanning the signature into the computer, should along with the
application, identity, resolution etc. be attached with the existing records in file of the
applicant.
• Before filing the documents as above, the staff of CSD will verify in the computer that
new signature(s) of the client has been properly scanned and fed into the system.
1.3.12. Stop Payment of Cheques
• In case of misplacement or loss of cheque/s the account holder may request the bank to
mark stop payment of cheques. Requests for stop payment instruction will be accepted
in writing. On receipt of such request, the staff at CSD will verify the signature in the
application form.
• Mark the date and time on the face of the application form in which the stop payment
instruction has been received by the branch. A „stop payment of cheque‟ instruction on
telephone can be entertained in special cases, but a formal request in writing must be
obtained in any case.
• The cheque cancellation time is to be mentioned on the cheque cancel application
request of the customer immediately after the application is processed for cancellation.
The system time of cancellation is to be affixed after it gets approved.
• Enter the application serially in the Stop Payment Register (Specimen 13).
• Stop payment instruction should be attended immediately and see that the cheque in
question has not been paid. If the cheque is not yet paid, the cheque should be stopped
in Finacle CBS immediately. If the cheque has already been paid before the receipt of
instructions, the client should be informed immediately in writing.
• It should be checked that correct cheque number(s) have been marked as stop payment.
• The stop payment of cheque(s) is to be requested by the account holder. However, the
same could be provisionally made by the beneficiary if he/ she is able to produce details
like account number, cheque number, cheque amount etc. The CSD will act as
described above and should obtain confirmation of the same from the account holder
first on telephone. Stop payment confirmation will be issued only after obtaining
confirmation from the account holder.
• If any cheque marked for stop payment is presented through clearing, then the Clearing
Department will return the cheque after marking “Payment stopped by the account
holder”. The Clearing Department should inform the concerned branch regarding the
return of stopped check at the end of the day.
• If cheque book lost request is received through telephone or other verbal
communication, after making proper verification, the account should immediately be
debit restricted or requested amount held in the account. If a formal written request
letter is not received within 24 hrs, the account should be released. Same should be
clearly communicated to customer at the time of receiving their verbal request.

38
1.3.13. Good for Payment (GFP) Cheques
A cheque backed by a bank‟s surety for payment is called as Good for Payment (GFP)
Cheques. When a cheque is marked with a “Good for Payment” stamp with authorized
signatures of the Bank‟s signatories, it is called a “Good for Payment Cheque”. Such
marking of the cheque means that the cheque will be honored within the validity period
irrevocably and unconditionally on presentation to any branches of the Bank.
1.3.13.1. Procedure to mark a cheque as “Good for Payment”
The customer submits an application (Specimen 14) along with the cheque to be marked
as Good for Payment.
• Signature of the accountholder on the application has to be verified. Then signature and
details mentioned in the cheques have to be verified to ensure its validity.
• Entry of the cheque to be made in the Finacle System. Once details are updated and
verified by user and after verification, following entry will be executed by the system
itself.
Customer‟s AC Dr.
Good for Payment Cheque AC Cr.
Customer‟s AC Dr.
GFP Issuance Charge AC Cr.
After ensuring that the cheque amount is transferred in the Good for Payment Account,
“Good for Payment” stamp is to be affixed on the cheque. Similarly, two authorized
signatories of the branch should affix their signatures by mentioning their signature no. of
Signature, Name, Designation and issued Date on the back side of the cheque. Likewise,
branch stamp is also to be affixed near the authorized signatures without fail.
• Branches should generate System Printed advice after issuing Good for Payment cheque.
One copy should be issued to customer and another copy should be kept by branches.
• Photocopy of the Cheque is to be taken and kept in record.
• Only Account payee cheque can be marked as Good for Payment Cheque. Hence, all the
Good for Payment Cheque must be marked Account Payee, i.e. payable only in the
account of payee.
• Post-dated (bearing a future date) cheques cannot be marked as Good for Payment.
• Separate register (Specimen 15) should be kept for recording issue of GFP Cheques.
Note:
Branches should check and confirm the validity of the GFP cheques before making its
payment [i.e. Credit as well as Debit transactions made in the GFP account is to be
checked]. Further, branches should reconcile the GFP accounts of their respective
branches on fortnightly basis. Any deviation shall be immediately reported to Central
Operations Department.

39
In case, Good for Payment cheque is presented in another branch, the Good for Payment
cheque amount should be debited from the Good for Payment account of the same branch
from which it has been issued. For example: If Good for Payment cheque is issued by
Durbarmarg Branch and presented to Birgunj Branch, Good for Payment account of
Durbarmarg Branch should be debited, not the Good for Payment account of Birgunj
Branch.
1.3.13.2. Cancellation of a Good for Payment Cheque:
• The Good for Payment Cheque can be cancelled only upon physical possession of the
original cheque by the Bank.
• In case the Customer or the payee requests to cancel the Good for Payment Cheque with
the reason that the cheque is lost, the request shall be obtained in writing from the
account holder as well as the payee.
• On account of cancellation of the cheque, necessary charges should be deducted from the
customer‟s account. The same can also be received in the form of cash.
1.3.14. Dormant Account
If an account remains inoperative for 6 months in case of Current and Call Account and for
3 years in case of Saving account, the status of the account changes in the system from
active to dormant. The accounts are automatically debit restricted in the system once they
become dormant.
Following precautions are to be taken in the operation of dormant A/Cs:
• Cash or any other deposit received in this account may be accepted by giving
intimation to Branch Manager/ABM/OI.
• For activating a dormant account, the account holder must be self-present in the bank
and submit an application form (Specimen 18) and such account should be activated
only after taking approval of BM/ABM/OI. Any withdrawals will be made possible
only after the account is activated.
• Request for the activation of a dormant account must be obtained in writing and
signature and identity of the customer must be verified in the form before proceeding to
activate the account.
• New KYC forms should be obtained from the customer before activating the dormant
account, if KYC update and CDD/ECDD is pending in the account.
• In case of firms/companies, renewed registration certificate (not applicable if registered
at Company Registrar Office), audited financials and tax clearance of last fiscal year,
• Share Lagat in case of a company, new KYC for the firm/company etc. are to be
obtained. In case of Share Lagat and KYC of the firm/company, if the firm/company
claims of no change in the ownership and/or details of the company, same is to be
obtained in writing in their letter head.
• Self-presence of customer should be compulsorily verified by the approving authority
before activating the dormant account and releasing the debit restriction.
• Special precautions shall be taken while issuing debit cards to dormant accounts.

40
• A report regarding the list of customers whose accounts were activated during the
month (within 5th
day of every month-end as per the Nepalese calendar) shall be
prepared and the transactions on such accounts shall be scrutinized by the respective
BMs/ABMs/OIs. Such reports shall be filed in the branch with signature of CSD In-
charge/OI and BM.
1.3.15. Standing Instructions
• Standing Instruction is an instruction given by the account holder to the bank to make
payment or transfer fund from his/her account to another in the frequency of a day, week,
month etc. These instructions are usually given for transfer of fund between Call and
Current accounts, from Savings account to Recurring Deposit account, from any other
account to loan nominee account etc.
• Account holder(s) will approach the Bank for standing instructions i.e. they will authorize
the Bank to make certain payments periodically / on certain dates by debiting their
account.
• Proper record of the "standing instruction" is to be maintained by branches in the Register
(Specimen 19).
 The CSD In-charge/OI/ABM/BM are responsible to ensure that standing instructions are
properly fed in the system and the instructions are taking effect on due dates.
 System manual for inputting standing instruction should be carefully followed to ensure
no error while inputting details is made and standing instruction is implemented correctly.
 After a standing instruction is applied on an account, the account must be monitored for
at least 2 days to ensure that sweep-in and sweep-out of funds between call and current
accounts are taking place successfully as per the instruction. Similarly, transfer of fund to
recurring deposit account on periodic basis should also be monitored.
 Necessary charges it to be obtained from the account as per our standard fees and
commission for implementing standing instruction in the account.
1.3.16. Account of Deceased Persons
In case any legal heir of the deceased account holder claims for payment of amount lying in
the account, following procedures are to be followed.
• Such cases should be dealt promptly.
• The person claiming the amount of the deceased account has to submit a written
application to the bank along with following supporting documents:
i. Copy of Citizenship Certificate of the claimant & deceased person.
ii. Copy of Death Certificate of the deceased person.
iii. Copy of latest Relationship certificate issued by government authority.
iv. Copy of Citizenship Certificate of Legal Heirs providing consent to applicant‟s
claim.
(Copy of all above documents has to be verified with original and verified with original
stamp has to be affixed on them.)

41
• On the receipt of information about death of a/c holder, the account has to be
immediately totaled frozen and any cheque drawn in such accounts should be returned
unpaid.
• Process of taking approval through memo from Head Office for closing of account and
transferring remaining balance should be carried forward by obtaining above
mentioned and other necessary legal documents.
• In case of FD of deceased person, FD should be prematurely closed without charging
penal interest and both principal and accrued interest should be transferred to respective
nominee account of the deceased.
• The provisions explained in Serial No. 111 of Bank and Financial Institution Act
(BAFIA) 2073 governs the rightful claimant of the deceased account.
1.3.16.1. Account with nominee
• As per Clause No. 111 of Bank and Financial Institution Act (BAFIA) 2073, Nominee
of the account has the first right on the deposit of the deceased.
• The nominee will be asked to lodge a formal claim.
• The submitted documents will be verified from the deceased a/c holder‟s Account
Opening Form and if the identity of the applicant matches with details of the nominee
and the claim appears to be genuine, request for approval to close the account of the
deceased and making payment to the nominee is to be forwarded to Central Operations
Department. After review and recommendation from Central Operations Department
&Legal Department and approval from Chief Operating Officer (COO) or higher
authority in chain, the outstanding balance in the account can be paid to the nominee.
Account of deceased person shall be closed after payment without levying any account
closing charges and full waiver on FD premature penal charge.
1.3.16.2. Account without Nominee
• In case there is no nominee in the account of a deceased account holder, the amount
lying in the account of deceased may be paid as per prevailing laws. The order of right
to claim the amount of deceased account has been defined in the Serial No. 111 of
BAFIA 2073. However, if there is more than one legal heir of the deceased, on the
basis of no objection letter obtained from remaining legal heir, amount can be paid to
the claimant after taking necessary approval from COO or higher authority in chain on
the basis of review and recommendation from Legal Department.
• Necessary assistance will be called from Legal Officer of the bank/Legal Consultant.
• After compliance of the legal procedures, outstanding balance in the account will be
paid after obtaining Indemnity bond (Specimen 20) signed by the heirs of the deceased.
• In case of complicated case where true legal heir is hard to get identified or there is
suspicion on the legal right of the claimant, Legal Department may advise to publish 35
days legal notice in national daily newspaper. If no claim is received within the notice
period, the account balance is paid to the claimant. However, if claim is received from
more than one person, the case is to be decided by the court.

42
1.3.16.3. Delegation of Authority to Branches for Closing Accounts of Deceased
Branches shall on approval of Branch Manager close the account (Savings and Fixed
Deposit Only) of the deceased and transfer the balance to the account of the claimant in
following cases where total balance of all accounts of the deceased is equal to or less
than Rs. 100,000/-:
 In case the deceased account holder had declared his/her spouse (husband or wife) as
nominee of the account, while opening the account.
 If nominee has not been provided in the account or person other than spouse of
deceased a/c holder, had been declared as nominee while opening the account. In this
case, required documents as mentioned under serial no. i to v above are to be obtained
by the branch. Branches to strictly follow the provisions specified in clause no. 111
(page no. 108) of BAFIA 2073 to find the order of right to claim over the deposit of
a/c, on the basis of type of relationship of the applicant with the deceased.
 In case, the account was maintained by the deceased person for receiving social
security allowance (G2P account). In this case, documents mentioned under Serial No.
i to vi including recommendation letter of concerned Ward Office clearly mentioning
to whom the balance of deceased account balance is to be paid are to be obtained.
 A memo is to be raised by CSD staff in the format similar that being forwarded to
Central Operations Department by obtaining signature of OI/Head CSD as
Recommender and the BM as Approver.
Branches should compulsorily verify all the copies of documents obtained with the
original documents and affix „Verified with Original‟ stamp and initials of receiving staff.
In case the deceased had also been maintaining locker at the branch, procedures
mentioned under Serial no. 1.6.9 of Operations Manual are to be followed without
releasing security margin until locker is closed.
Please note that for all other cases related to closing of deceased account, except for those
mentioned above and where balance in the account exceeds Rs. 100,000.00, branches
shall continue to forward their request for approval through memo to Central Operations
Department as per existing practice.
It is also informed that in any of the above mentioned 3 cases also, if the branches feel
hesitant to decide the authenticity of the right of claim of the applicant, they may forward
their request to Central Operations Department for approval.
1.3.17. Account of Minor
Person not attaining the age of 18 years are called as Minors, irrespective of whether
he/she has obtained Citizenship Certificate or not. The bank can open Minor Accounts for
which the following rules are to be followed:

43
• The account will be operated by the Guardian of the minor until the minor into major or
attains the age of 18 years.
• Documents required to open an account of a minor include Birth Certificate and 2 PP
size photographs of the minor, Citizenship Certificate or Passport and 2 PP size
photographs of a Guardian. If the minor has crossed 16 years of age and has also
obtained Citizenship Certificate, it can also be accepted instead of Birth Certificate.
Separate KYC form of both minor and guardian is to be obtained.
• If guardian is not the parents of the minor, recommendation letter from Ward Office is
to be obtained. The recommendation letter should mention the relationship between the
proposed guardian and the minor and the reason why the parents could not become
guardian for the account.
• The guardian details in the Account Opening Form should be properly filled disclosing
the relationship between the minor and the guardian.
• Caption should be inputted in the Specimen Signature Card as “Minor Account” as well
as in the image of the system.
• No OD/ Loan facility is to be allowed in this account.
• Branches should update minor turning major date in SVS/Signature Module in Minor
account [i.e. Date of expiry of Minor accounts] while opening the Minor accounts.
• Customer should be duly informed that account will be debit restricted once the minor
turns into major.
• When minor turns into major or attains 18 years of age, the existing a/c shall be closed
in case of Muna Bachat account. In case of other accounts, the same account can be
continued by obtaining complete AOF and KYC filled by the account holder and
obtaining his/her citizenship certificate and latest photograph.
• If the account holder is out of contact, then the account should be debit frozen with
complete remark mentioning “Minority Ceased”.
• No transaction should be allowed on the account once the minor turns into a major,
until the minor submits citizenship certificate, AOF and KYC for operating the account
through the signature of the account holder. A request letter signed by both the account
holder and the guardian is to be obtained for changing the operating authority of the
account .
• In case of emergency, the guardian may request in writing for withdrawing some
money from the account balance. If the branch deems the request as genuine and
justified, they can forward the request to Central Operations Department for taking
approval from COO or higher authorities.
1.3.18. Accounts of illiterate person
The bank can open accounts of an illiterate person with their thumb impression.
Precaution is to be taken and following points to be noted while opening and operating
account of Illiterate person.
• If any illiterate person desires to open an account, his/her both Right and Left thumb
print should be taken in place of signature. These thumb print should be distinguishable
i.e. Right and Left should be marked with the thumb print.

44
• Special instructions to be noted both on Account Opening Form and SS Card to the
effect, that "account holder should visit the bank personally with original copy of
personal identification card(citizenship) in case of withdrawals and affix his thumb
impression on the cheque book in presence of bank staff".
• Staff taking thumb impressions should attest only after comparing the face with
photographs under his full signature in token of having taken thumb Impressions in his/
her presence and pass on the cheque for payment.
• His/her cheques will be paid in cash across the counter only and not if presented in
clearing.
• Transfer of fund from his/her account to another person‟s account should not be
allowed as far as possible.
• However, in special cases where the customer is required to make payment to another
party, he/she can draw the cheque & affix his/her thumb impression in presence of
Bank official and hand it over to the beneficiary, who can then deposit the same into his
account. Similarly, he/she can also draw the cheque in the name of another person to
transfer fund to his/her account maintained in our bank.
• If the beneficiary does not have account with the bank and does not agree to open the
account even after making of sincere request by the branch, a Manager‟s Cheque can be
issued on the request of the account holder by taking applicable charges.
• In special cases mentioned above, a written request must be obtained from the customer
mentioning the purpose of making the payment. Thumb impression of the customer is
to be obtained in the request letter in presence of branch staff. Moreover, signature of at
least one literate person as witness, preferably his near relative, is also to be obtained in
the request letter, in presence of bank staff. The witness should state that he/she has
clearly communicated the content of the letter and its meaning to the account holder
and he/she has affixed his/her thumb impression only after understanding and providing
consent to it.
• The amount being withdrawn from the account of the illiterate person should be
properly communicated to him/her in every transaction.
• The illiterate person cannot appoint mandatee/s to operate the account in his/ her behalf.
• An illiterate person can‟t introduce other person for opening an account.
• The introducer of an illiterate person‟s account will confirm in writing duly signed that
he has conveyed/read all terms and conditions of opening the account to that person and
account holder will also affix his/ her thumb impression as a token of having
understood all the rules for opening of account.
• All the provisions stated above will be applicable for opening/operating of accounts of
illiterate person with shaky signatures.
• If the illiterate customer wants to update the signature instead of thumb print in the SS
Card, an application must be received from the customer stating the reason for doing so.
The new signature should be duly attested.
• ATM card and other medium of service delivery channels such as E-banking, Mobile
Banking facility with transaction enabled should not to be provided in the account of an
illiterate person.
1.3.19 Account of Blind/ Visually Impaired Person and differently abled person

45
The bank can open accounts of blind/ visually impaired person. In case of blind/visually
impaired person, precautions and points as mentioned under operating accounts of illiterate
persons are to be followed. However, in addition to this, signatures and thumb impressions
of two independent persons also need to be obtained as witness at the time of account
opening by authorizing a person who will accompany the blind/visually impaired person
for operating the account. The blind/visually impaired person should always be self-present
at the bank counter along with the authorized person for making withdrawal from his
account through cheque and the authorized person should affix his/her signature on the
back side of the cheque.
In case of a partial visually impaired person, if the account holder requests for availing
Mobile Banking service and/or ATM and the BM becomes convinced of his/her ability for
using these services through live demonstration, the BM may provide these services to the
visually impaired account holder after taking approval from COO or higher authority by
forwarding the request through Central Operations Department .
1.3.20. Recurring Deposit Accounts:
• A Recurring Deposit Account is a special kind of Fixed Deposit account in which a
fixed amount is deposited in the account every month up to a specified period of time.
The total deposited amount along with interest is paid at the time of maturity.
• Branch user need to update applicable interest rate while opening Recurring Deposit
accounts in “A/c. Credit Preferential Interest” under “Interest and Tax” tab.
• Further, branches also needs to input Expiry Date of the account in Free Text 7
(Pumori Remarks) field under “MIS Codes” tab by entering expiry date in the format
DD/MM/YYYY as per English calendar (A.D.). For example, 14/12/2022 contains two
digits of the day, two digits of the month and 4 digits of the year, which meets the
format and is also in correct order. The correct format of date is required for effective
monitoring of the expiry date so that the account can be closed after its maturity and
balance is transferred to the nominee account.
• Similar to that of Fixed Deposit, the first deposit of Recurring Deposit account should
be made on the day of account opening.
• The depositor may choose to deposit the amount in this account in cash or request to
apply standing instruction for transferring from his/her another account on a specified
date of a month.
• Only fixed deposit amount specified at the time of opening the account should be
allowed to be deposited in the account on monthly basis. Similarly, no debit transaction
should be allowed from Recurring Deposit account. The accumulated monthly deposit
and interest amount are to be paid only on maturity.
• Branches should monitor the status (i.e. maturity period, amount, interest rate, etc.) of
Recurring Deposit Accounts of their respective branches. If any of the accounts are
found to have matured, they should be closed and closure proceeds should be transferred
to the nominee account.
• If there is no nominee account of the account holder and he/she is also out of contact,
the interest rate input in A/c. Credit Preferential Interest rate field and Min-Max interest

46
rates of the account should be updated to 0% by inputting Start Date as the date of
maturity.
1.3.20.1. Premature of Recurring Deposit Account
• Payment of a recurring deposit before its due date is not permissible. If the customer is
in dire need of fund, he/she should be convinced to avail a loan against his/her deposit.
Payment of a recurring deposit before its due date is to be discouraged. If it is
unavoidable then process for prematurely closing should be proceeded only after taking
• As per prevailing product paper of RD, prematurely closing charge of 2% shall be
applicable on the account from account opened date and no accrued interest is paid to
the customer.
• However, in case of death of the account holder, the recurring deposit may be pre-
matured before maturity date by the nominee/legal heir of a deceased Account holder by
presenting death certificate and completing other (legal) formalities. Premature closure
charge shall not be applicable in this case and accrued interest is also paid in the account.
• Pre-mature of recurring deposit shall also be permitted if the account holder is
emigrating out of Nepal permanently on the production of a valid visa etc.
1.4. Account Closing
• Any request for the closure of accounts should be made on the prescribed form
(Specimen 2) by completely filling all particulars there on.
• On receipt of request for the closure of account, the staff of CSD has to verify the
signature and affix Signature Verified Stamp. Then he/she should check the account
balance. All A/c closing requests must be approved by Branch Manager/ABM/OI
himself.
• The Head of CSD/Operation In-charge/ABM/Branch Manager has to discuss with the
client for ascertaining the exact cause of account closing request. If the customer is
not satisfied with the banking services, he should be tried to be convinced about
providing better service in the future.
• Accounts cannot be closed on the request of the Mandatee/POA Holder. Account
holder or authorized signatory/s must be present to close the account in case of
individual, sole proprietorship and partnership accounts.
• The Customer Liability Report should be printed from the system and be checked to
ensure that no other liability of the customer exists towards the bank.
• Before closure of accounts, clearance from following departments should be obtained:
• Trade Administration Department
• Credit Administration Department
• Finance Department
• Locker Department
• Card Department
• E-Banking/ Mobile Banking
• Demat/C-ASBA
• Central Clearing

47
• While making payment of account closure proceeds, banking instruments such as
account transfer, Manager‟s Cheque, IPS etc. should be preferred instead of cash.
• The customer should be asked to return all the unused cheques along with
ATM/Debit Card & Credit Card, if issued. Print the list of valid cheques remaining
with the client and confirm that all valid cheques of the last print are returned by the
customer. If the customer fails to return all or any of the valid cheques, indemnity
form (Specimen 65) should be obtained signed by all authorized signatory/ies of the
account.
• If the customer is unable to submit last issued cheque book, applicable cheque book
lost charge as per standard fees and commission should be obtained.
• After making the payment of the closure proceeds of the account and after deducting
the necessary charges, the balance in the account will be checked in the system to
confirm that the account is having zero balance.
• All the documents received from the client for the closure of account will be attached
with the account closing application form.
• On closure of account, “Account Closed” stamp will be affixed on the face of the
Account Closing Request form/letter and Account Opening Form.
• Any type of transaction baking services that were being availed by the customer such
as Debit Card, E-Banking, Mobile Banking, connectIPS, CorporatePAY etc. should
also be disabled/blocked in the respective system once the account is closed.
• For the closure of joint accounts, the signature of all the joint account holders will be
obtained in the application form. However, physical presentation of any one of them
will be acceptable for closure of accounts.
• Particulars of all the accounts closed will be entered in „Account Closed Register.‟
(Specimen 22).
1.4.1. Closing of Individual accounts:
• For the closure of personal saving / Current account, the person should himself attend
the bank.
• The customer should sign the account closing application form in the presence of the
staff of CSD. The stamp „signature Verified‟ should be affixed on the application
form.
• If the customer is a high ranked person and does not personally visit the branch, the
branch may close his/her/their accounts based on the genuineness of the request after
contacting the account holder over telephone for confirmation. In all such cases, the
branch should verify the a/c holder‟s signature in the application form affixing
signature verified stamp. The branch should also demand an authorization letter
mentioning reason for him/her not being able to visit the branch and identification
document of the account holder and person visiting the branch.
• All such cases will be referred to Branch Manager/ABM/OI. The Branch
Manager/ABM/OI will confirm the account closing request with the customer. The
account will be closed only if the above authority approves the closure of account.
1.4.2. Closing of Accounts of Firm/Company/Institution etc.:
• For the closure of these accounts, the following documents, in addition to the account
closure application will be obtained.

48
 Authorization letter which should bear a specimen signature of the authorized
signatories which must be duly verified by the authorized signature/s of the
account.
 Identification of the authorized person/s.
 In case of companies and other organizations, minutes of the Board or other
governing authority to close the account, if required.
• On receipt of the above documents, the signature/s of the application form and
authorization letter should be verified.
• If the authorized person does not have any identification or if doubt arises on the
genuineness of the authorized person, the account holder/authorized signatory should
be contacted to confirm the genuineness of account closing request.
1.5. Fixed deposit (FD)
Deposit held for a fixed period of time with a condition of allowing withdrawal of the
principal amount only at the time of maturity is called Fixed Deposit. Fixed deposit is also
called as Term deposit or Time deposit. Each Fixed deposit is a separate contract. Thus,
further deposit to or withdrawal from an existing fixed deposit Account is not possible.
1.5.1. Eligibility to Open a FD
Any individual, firm or company can open Fixed Deposit account with the Bank.
• A minor, being incapable to enter into a contract on his own, may open a FD account
only if the account will be operated by his parents/legal guardian.
• A walk-in customer can open a fixed deposit account with the bank by opening a current
/ saving account, required to credit interest and principal due.
• Fixed deposit account can be opened in joint names by opening a joint account or single
account in the name of one of the a/c holders with consent of both in writing.
1.5.2. Procedure of Opening a FD
• An applicant of FD account also has to open a current / saving account as nominee for
quarterly/monthly interest credit and principal repayment of FD at the time of maturity.
Procedure of opening a nominee account is as mentioned in account opening section of
this document.
• Customer intending to open a Fixed Deposit account should fill up a Fixed Deposit
Application Form (Specimen 23).
• The signature of the customer and his/her photograph must be verified from the bank
record of exiting nominee account.
• The Fixed Deposit account should then be opened by ensuring principal features of FD
account such as principal amount, interest rate, account opening value date, maturity
date, tax rate, interest nominee account ID, repayment account ID etc. are correctly fed
in the system that tally with the details of Account Opening Form.
• Two signatories, as per the signing authority of the bank, shall sign the Fixed Deposit
Receipt after scrutinizing the following:
a) The fund has been credited in the FD account through cash deposit a/c transfer.

49
b) The details of Fixed Deposit Receipt tallies with the details in the Account Opening
Form.
c) Special instructions, if any, regarding payment of deposits, applicable interest rate for
availing Loan against FD etc. are written on the back-side of FDR.
d) The rate of interest, date of issue and maturity date are correct.
e) Nominee account has been assigned and correctly indicated on the account opening
form as well as in the system, wherever applicable.
• The staff opening the FD account and more importantly, the Verifier of the account,
must check that below given details have been correctly fed into the system :
 Account has been opened in correct scheme
 Principal amount has been credited into the FD account.
 Interest payment frequency is correct.
 Interest Rate and Tax rate are correct.
 Tenure of deposit is correct.
 Customer Type is correct.
 Nominee for interest payment and Repayment Account ID are available and
correctly fed into the system.
Fixed Deposit Receipt will be delivered by taking signature of depositor on the counterfoil
of the FDR.
• Only one copy of Fixed Deposit receipt will be prepared and issued to the customer. If
the customer has lost his /her original FD receipt and requests to provide another copy of
it. A symbol of “Duplicate Copy” should be affixed in the new copy of FDR and
applicable charges is to be recovered.
• If FDR is requested to be delivered to a person other than the account holder himself, a
letter of authority or proper identification of the representative must be obtained.
• The interest rate on Loan against Fixed Deposit should be conveyed to the account
holder at the time of opening the Fixed Deposit and same should be acknowledged by
the customer. Branch should print the terms and conditions regarding the same on the
back side of the FDR and obtain the acknowledgement of the customer on the Bank‟s
receipt slip.
• A Fixed Deposit Register (Specimen 24) shall be maintained in the prescribed format
clearly mentioning the following details:
• Serial Number
• FD Account Number
• FD Account Name
• FD Reference Number
• FD Opened Date
• Amount
• Tenure
• Interest Rate
• Expiry Date
• Nominee Account Number
• Remarks

50
• Fixed Deposit account gets auto closed at maturity date and amount is auto credited into
customer‟s operative account unless the account is lien marked for Loan against FD
availed or operative account is not mentioned in the account. In such case, lien is to be
released and account has to be closed manually at maturity date. In case principal
repayment a/c ID has not been input in the system, the closure proceeds will be credited
into Matured Term Deposit Payable account.
1.5.2.1. Fixed Deposit in Foreign Currency
 Fixed Deposit in USD or other convertible foreign currencies permitted by NRB can also
be opened of those customers who are maintaining FCY Savings or Current account.
 FCY FD can also be opened in the name of foreign companies or Non Resident Nepalis.
FD in FCY of foreign companies or NRNs will have following features.
 The tenure (period) of FD should be at least 1 year.
 The nominee Savings or Current account of the FCY FD should be of same
currency.
 The FD can also be opened in joint names of two or more than two foreign
companies or two or more than two NRNs.
 The documents to be obtained in case of foreign companies would be same as
mentioned in documents to be obtained for account opening section. The
documents should include board minute to open FD account.
 The NRN card issued by concerned authority is to be obtained in case of NRNs.
 The FD can be opened in USD, EUR, GBP, AUD, CAD, JPY and CNY.
 The premature of FD is allowed only after completion of 1 year from the date of
account opening.
 The minimum FD principal amount is USD 5,000/- or other convertible foreign
currency.
 Detail provisions for opening accounts of NRNs or Foreign Companies has been
covered in clause no. 3 of Unified NRB FXM circular 17/2078.
1.5.3. Rate of interest on FD and minimum Deposit
• Rate of interest on fixed deposit shall be published by the bank from time to time.
• Minimum amount for opening Fixed Deposit under normal scheme is Rs.10,000/-.
Minimum balance of FD under other scheme may vary according to product paper.
• Branches shall accept fixed deposits at the published rate of interest. Any branch,
considering other business potentials of the customer, intending to offer a rate higher
than the published rate may seek the approval of competent authority.
• Interest on Fixed Deposit will be paid as decided by the management from time to time,
by way of credit to the client's nominee account.
• No Fixed Deposit should be opened on predetermined terms that the customer will be
allowed to prematurely close the account at any time within the validity of the FD.

51
1.5.4. Stock of FDR
The stock of fixed deposit receipts will be kept under dual control of the staff handling
FDR issue and the Branch Manager/ABM/OI/Head CSD. FDR Stock Register will be
maintained in the prescribed format (Specimen 25).
• Receipts of stock will be promptly recorded in the stock register by mentioning the serial
number of the FD Receipt stock.
• The Branch Manager/ABM/OI should physically verify the stock of FDR once every
month to ensure that FDR stock is not misused and record is maintained properly.
• Fixed Deposits Receipt should incorporate following information on the back side:
“Final Maturity: Principal amount of deposit will be automatically credited to your
Savings or Current account on final maturity of the deposit.”
The same shall be arranged to amend the instruction as follows with staff signature
and stamp on the amendments before handing over the Fixed Deposit Receipt to
customers:
Final Maturity: Principal amount of deposit will be credited into your Savings or
Current account on final maturity of the deposit upon surrender of this Fixed
Deposit Receipt.
1.5.5. Payment of FD
• Fixed Deposit Receipt presented for payment should be minutely checked to ensure there
are no unauthorized alterations on the Fixed Deposit Receipt. Any alteration not
authenticated by authorized signatories of the bank should be brought to the notice of the
Branch Manager/ABM/OI who will have to investigate the matter and ensure that the
instrument is not being misused.
• Matured FDs gets auto closed and amount is auto credited to customer‟s operative
account unless the account is lien marked and operative account is mentioned in account.
In such case, lien is to be released as required and should be closed manually
• It should also be checked if lien is not marked on the FDR or a caution is not noted
against the Fixed Deposit in Register or system.
• If Fixed Deposit is lien marked in FD receipt and in the system, it should not be paid
unless the lien marking is released in writing by the concerned Branch, department or any
government authority.
• Where caution is noted against the Fixed Deposit Receipt, payment should not be made
till the caution is released/ withdrawn. However, the FD can be closed and amount can be
held in the nominee account of the customer.
• A fixed deposit falling due for payment on Saturday or holiday is payable on the next
working day.
• Fixed Deposit Receipt must be duly discharged by the depositor by signing on the reverse
page of the FD receipt on its presentation for payment.
• The a/c holder should personally visit the branch to submit FDR to renew or get payment
of the FD. He/she may send the FDR through his/her representative by submitting a
request letter by affixing his/her signature on the request letter as well as on the back of
FDR. On the latter case, the CSD staff should carefully verify the signature on both

52
request letter and back of FDR and also obtain copy of ID card, verified with original, of
the representative.
• Fixed Deposit Receipt being a non-transferable instrument, can only be paid to the payee
in whose favour it had been issued. Hence, payment cannot be made to a third party.
• After the maturity of Fixed Deposits, the principal amount and accrued interest will be
transferred to Repayment Account ID specified in the system at the time of opening the
account. In case Operative account is not mentioned in “Repay A/c ID” field in CBS or
Matured Time Deposit account itself is mentioned in “Repay A/c ID” field in CBS due to
absence of operative account, the closure proceeds of FD will be transferred into Matured
Time Deposit account. Payment or renewal of such deposits is to be made by debiting
Matured Fixed Deposit account.
• If there is no nominee account maintained by the customer for the repayment of FD after
maturity, the principal amount and accrued interest gets transferred to Matured Time
Deposit Account. In such case, sum of interest and principal amount can be transferred
Account Payable Others account by mentioning account name and account number and
remarks as “FD Receipt to be Surrendered”. The payment can be done only when the
customer personally visits the branch and surrenders the FD receipt to the bank.
• The branch should monitor the maturity dates of Fixed Deposit accounts being
maintained by their customers and should try to contact the customer through the fastest
communication medium, at least before 15 days before the maturity date, to confirm
whether he/she wishes to renew the Fixed Deposit.
• The calls made to the customers from time to time should be recorded in Call Report
Register (Specimen 27) to be updated by the branch with signature of CSD staff as well
as the Branch Manager/ABM/OI. Repeated follow-ups to the customers not contacted to
be made every week and the remarks shall be updated in the register.
1.5.6. Pre-maturity of FD
• Payment of a fixed Deposit Receipt before its due date should be discouraged as far as
possible. If the customer is in dire need of fund, he should be convinced to avail Loan
against FD facility.
• In case of an unavoidable circumstances and the customer is not willing to avail Loan
against FD facility, then branch should obtain application (specimen 55) from the
customer and proceed to get approval to Central Operations Department for taking
approval of COO or higher authorities for the prematurely closing the FD.
• Pre-mature liquidation of FDR shall also be permitted to an account holder who is
emigrating out of Nepal permanently on the production of a valid visa etc.
• Claim of fund under the fixed deposit before maturity is proposed to be allowed upon
deduction of 2% from applicable interest rate.
• Applicable interest rate is the published rate of interest for the period in which the deposit
is actually held at the time of pre maturity. If there is change in interest rate, lower rate
between the current and then applicable rates will be applied. For example, if a person
opens a fixed deposit for the period of 2 years at 6% interest rate per annum, but after 1
year and 2 months, he requests to prematurely close the FD. Here the FD remained period
is considered as 1 year, not 2 years as the FD only remained with the bank for 1 year.
Now suppose, the applicable rate for 1 year period at the time of account opening and at
the time of prematurely closing is both 5%. In this case, the bank will pay at 3% interest

53
(i.e. 5% - 2%) not (6% - 2%) on the deposit and allows the customer to withdraw money.
On the other hand, suppose the interest for one year period at the time of prematurely
closing has decreased to 4% per annum from 5%. In this case, bank will pay interest @ 2%
(i.e. 4% - 2%) to the customer.
• However, if the FD has remained with the bank for less than 3 months, minimum interest
rate of savings account will only be paid for the FD remained period.
• During the premature of deposit, if regular interest has already been credited in the
account, the differential interest between actual interest and applicable interest will be
recovered from the principal amount of deposit by the system. For this, the branch must
enter applicable interest rate when prematurely closing the FD account.
• However, in case of death of the account holder, FD may be pre maturely closed by
his/her nominee/legal heir holder by presenting death certificate and completing other
(legal) formalities. No premature closure charge is applicable in this case.
Note: In Finacle, all such tasks of recovering excess interest are adjusted by the system itself
if Negotiated Interest Rate field is updated with correct interest rate. In above example, if
interest rate hasn‟t changed over the period, 3% has to be updated and if interest rate has
decreased as mentioned above, 2% has to be updated in Negotiated Interest Rate field. No
manual intervention is required. However, this procedure is not supported by the system if
the FD had been opened in Pumori system. Hence, differential interest rate for such old FDs
needs to be adjusted manually.
1.5.7. Standing Instruction for Renewal of FD
A depositor can give standing instructions for automatic renewal of Fixed Deposit at the time
of opening the FD Account.
• Bank staff should advise the customer, at the time of opening the Fixed Deposit Account,
that he can also issue a standing instruction for automatic renewal of the FD.
• If automatic renewal instruction is given by the depositor, his fixed deposit account
should be renewed on maturity. Upon the visit of the a/c holder, Old FDR should be
recovered and new FDR should be issued to him/her. However, this process is manual
and no standing instruction can be created.
• The customer should be contacted and asked to visit the bank to surrender the old FDR
and collect the renewed receipt.
• The renewed Fixed Deposit Receipt will be kept in safe custody in fire proof cabinet
under dual control till the time the customer collects it.
1.5.8. Interest on matured FD
• No interest is payable on fixed deposit after maturity date till the date of renewal.
• However, considering the merit of each case, interest may be paid from retrospective
effect on matured FD renewed as follows:
• If FDR is renewed within 7 days from the date of maturity, for a period of six months or
more, Branch Manager is authorized to renew the FD w.e.f. the date of maturity and pay
interest for the overdue period.

54
• If FD is to be renewed with retrospective effect from back date exceeding 7 days but
within 30 days, for a period of six months or more, the branch must seek approval from
COO or higher authorities.
• Retrospective renewal cannot be made if maturity date of FD has crossed 30 days.
• The ruling rate of interest on the date of renewal will be the applicable rate of interest on
renewed Fixed Deposit.
• For opening Fixed Deposit account with retrospective effect, the operative account must
have balance at least equal to the principal amount of FD on the value date from which
the FD is to be opened.
1.5.9. Issue of Duplicate FDR
Loss of a Fixed Deposit Receipt should be immediately reported to the bank in writing by the
depositor. Since, payment of fixed deposit is possible only on the surrender of the FDR, the
depositor should be advised to make a request for issue of a duplicate certificate. A letter of
indemnity must also be obtained along with the request letter (Specimen 28).
• The account holder must himself come to the bank to take delivery of the duplicate FDR.
However, if a representative is deputed by the account holder, he must also submit a
letter of authorization, on which his signature is attested, from the account holder.
• The words "Duplicate issued in lieu of original FDR No.______" shall be
written/stamped on the face of the duplicate FDR under the bank's seal.
• These words will also be written on the original application form. Also, remarks will be
added on the FD Register on the relevant column.
• The particulars on the duplicate will exactly be the same as the original FDR except for
the serial number of the FD Receipt.
• Applicable charge is to be obtained for issuing duplicate FDR.
1.5.10. Loan against FD
Loan against FD is the credit facility provided to the Fixed Deposit Holder of the bank
against the security of the Fixed Deposit Receipt.
 Loan against FD (LFD) may be granted up to 90% of the face value of FDR.
• Application for Loan against Fixed Deposit (Specimen 29) should be obtained from the
customer wishing to avail this facility.
• The application will be handled by the Customer Service department. This department
will enter loan limit against the fixed deposit account.
• Separate account for this loan will be created which will be named as Loan against Fixed
Deposit in which customer will be able to withdraw the loan amount up to the available
limit.
• This account will be of revolving in nature where customer can deposit as well as
withdraw the amount up to the limit. Deposit in this account is allowed up to the
available balance of zero so that this account never remains in credit balance.
• Loan processing fees will be nil and interest will be charged only on utilized loan amount.
 Cheque book of 5 leaves will be provided to the customer to withdraw money from the
LFD account. In case of LFD of a corporate customer, cheque book can be issued as per
their requirement.

55
• Image in the LFD account shall be compulsorily inserted by the branches.
• The original Fixed Deposit Receipt will be retained in the bank and loan provided under
the fixed deposit will be mentioned in the reverse side of the receipt and signed by the
depositor.
• The applicable rate of interest on LFD account will be 2% above coupon rate or 2%
above base rate, whichever is higher, or as decided by the management from time to time.
Interest will be calculated on daily basis and will be charged on quarterly or monthly
basis, matching the interest payment frequency in the Fixed Deposit account. In case of
quarterly interest payment frequency, interest will be recovered on Ashadh end, Ashwin
end, Poush end, Chaitra end of Nepalese calendar and on maturity of loan.
• If Loan against FD is to be provided against FCY FD maintained by a Nepali Citizen
(individual/company), Loan against FD in NPR currency can be provided up to 90% of
the equivalent NPR amount at interest rate of 2% above published interest rate for NPR
FD of equal tenure or 2% above base rate, whichever is higher.
• Expiry Date of Loan against FD facility should be the maturity date of Fixed Deposit
account. If the maturity date of the FD falls on any public holiday including Saturday, the
penal interest calculated by the system can be waived by adjusting penal interest due in
the system for the day/s of holiday only.
• Loan against FD facility cannot be provided to Indian or other Foreign Nationals. If the
customer is in dire need of fund, the FD can be prematurely closed after taking due
approval.
• Branch has to define respective FD account under Entity ID of CBS for linking loan
against FD account and fill up all required details in system.
• System automatically marks lien on FD account against the loan provided as per
mentioned Entity ID in the system.
• When the maturity date of LFD is drawing near, the customer should be pre-informed at
least 15 days prior to the LFD expiry date. If the closure proceeds of FD account seem to
be inadequate to make settlement of LFD account or LFD has been availed for shorter
period as compared to FD maturity date, customer should be requested to deposit
required shortfall amount on or before the expiry date.
• If the closure proceeds of FD is sufficient to cover the outstanding limit of LFD and
accrued interest receivable, the LFD account can be closed after maturity of FD without
waiting for the request letter of the customer.
• After maturity of FD and loan against FD, FD account needs to be closed manually due
to the lien status against the loan availed. In order to close the FD, the loan account and
interest therein must be settled first using intermediate account such as IDT or account
receivable. FD shall be closed and after making settlement of amount debited from IDT
account from FD closure proceeds, the remaining balance is to be credited to the
depositor‟s account.
• If cheque book has been issued in the LFD account, remaining leaf should be returned by
the customer. If the customer fails to submit remaining cheque leaves, indemnity form
should be obtained mentioning cheque leaves and necessary charges is to be recovered.
• If a customer applies for a loan against FD issued by another branch of CBIL, an email is
to be sent to the concerned branch requesting consent from the concerned branch‟s
BM/ABM/OI. Concerned branch shall then provide consent after recording lien mark on
Application form of FD. Only after receiving consent from Branch Manager/ABM/OI of

56
the concerned branch, request receiving branch can proceed for extending loan against
FD facility.
• Lien shall be marked on the face of the FD under the bank's seal. The lien shall also be
immediately recorded in the Application Form of Fixed Deposit by concerned branch.
• The interest rate on Loan against Fixed Deposit should be conveyed to the account holder
at the time of opening the Fixed Deposit and same should be acknowledged by the
customer. Branch should print the terms and conditions regarding the same on the
back side of the FDR and obtain the acknowledgement of the customer on the Bank‟s
receipt slip without fail. Once the interest rate applicable for Loan against FD is
determined according to this, the rate cannot be changed in the future.
• If there is any deviation from our standard norms related to % financing of FD amount
being provided or interest rate being charged in the LFD account, request is to be
forwarded to Central Operations Department for taking approval of COO or higher
authorities.
1.6. LOCKER
1.6.1. Introduction
“CITIZENS SAFE DEPOSIT LOCKERS (CSDL)” are fire-proof safe deposit vaults
offered to our customers for the safe deposit of their valuables. Due to the increasing
insecurity in the communities, utility of Safe Deposit Lockers is increasing and this
banking product is gaining popularity. CSDL are available in various sizes.
1.6.2. Allotment of Lockers
This facility is available to the account holders of the bank only. The person hiring the
locker is called Locker Holder or Licensee and the Bank as Licensor. To be eligible for
this facility, the customer will have to deposit a certain amount as Key Deposit and pay
the annual charge according to the locker size. In case of high demand and limited
availability of lockers, the Bank will have to allot with preference to the high value
customers based on profitable business relationship. Following procedures are to be
followed while allotting the lockers:
• The “Locker Application Form” (Specimen 31), “Locker Department Form”
(Specimen 33) and “Customer Declaration for Availing Locker Facility” (specimen 37)
are to be properly filled up by the customer. These forms contain the name and address
of the applicant, account number, locker size and terms and conditions of licensing the
locker.
• 3 copies of photographs of the applicant should be obtained. One is to be attached on
the “Locker Application Form”, one on the “Locker Access Register” (Specimen 34)
and one on the Locker ID card (Specimen 35) which is to be provided to the locker
holder.
• “Nominee Form” is to be filled-up and signed by the applicant who appoints a
nominee that will receive the contents of the locker in case of death of the Licensee.
• The locker operation instruction for locker operation must be given by the customer. If
the locker holder appoints a mandate, KYC form, citizenship/passport and 3 copies of
photographs of the mandate should be obtained.
• Approval for renting the locker should be obtained from the Branch Manager/ABM/OI.

57
• System auto debits the applicable annual locker rental charge and manual entry is to be
done only incase system fails to recover such charges. Following entries to be passed
in case of manual entry:
Customer‟s Current or Savings Account Dr.
Locker Issuance Charge Cr.
The annual locker rental should always be recovered in advance at the starting of each
yearly term.
• Certain amount (as fixed by the Management) should be held in the Client‟s saving or
current account as Locker Key/Security Deposit. The key deposit is taken as a security
for cost of replacement of the key, if the same is lost by the customer.
• New Allotment of locker is to be posted in the Locker Access Register (kept in the
Customer Service Department).
• Locker key with Locker Id Card is to be handed over to the Locker Holder and
acknowledgement of receipt of the key has to be obtained.
• Locker to the other branches‟ customers (inside as well as outside valley) can also be
provided from branch having locker facility. Confirmation in e-mail regarding
completion of all relevant account opening documents and no objection to issue the
locker to the customer shall be obtained from the respective Branch Manager/ABM/OI
of the branch whose customer wants to avail the Locker Facility. Relevant documents
regarding locker shall be obtained by the Locker Department of locker issuing branch.
• The customer can avail multiple locker facility from same branch or different branches.
The annual subscription charge shall be applicable for each locker separately.
Similarly, security deposit for all the lockers should be collectively held in the account.
• Locker facility can also be availed by a company. For this, a formal request letter, a
board minute nominating the person operating the locker, KYC, citizenship
certificate/passport and photographs of the locker operator should be obtained.
1.6.3. Locker Visit Operations
• “Locker Access Form” (Specimen 36) to be filled up every time when a person comes to
visit the locker.
• The person should be identified as Locker Holder by face with his photograph in the
Locker ID card. Then, the signature on the “Locker Access Form” and Locker ID card
must be verified by the concerned staff.
• Once the Locker Holder is identified, “Locker Access Register” is to be filled up which
includes details like Locker Holder‟s name, date of visit, time of visit (in and out time).
The customer should sign on the register every time he visits the locker.
• The Locker Holder should be taken up to the locker room and Bank‟s part of the lock
should be opened first with the Master Key. Once the client opens his part of the lock
applying his keys, complete privacy is to be given to the client.
• No two or more Locker Holders should be allowed to use their lockers at the same time.
The locker holders should be asked to wait for their turn so that only one locker holder
could use the locker at a time.
• Entrance of Locker must be well covered by CCTV with CCTV cameras facing the
entrance door. CCTV cameras should not capture image inside of locker area.

58
1.6.4. General Norms: Locker Operations
• Keys of the Locker Main Gate / Bar Gate should be held in the joint custody of the
Customer Service Department (CSD) – In-charge and the Branch Manager/ABM/OI. 2
staffs are to be present while opening the locker during locker visit by Holders.
• A staff must be kept stand-by at the Locker Room gate at the time of locker visit by the
customer.
• The Master Key of the lockers should be held by CSD–Head/In-charge. However, at
the end of the day, the keys are to be kept by the custodian as per approved Key
Custodian.
• The keys of the unrented lockers should be held inside one of the unused lockers.
• The Bank is not supposed to know/examine the contents inside any of the rented lockers.
1.6.5 Items Found Unattended in the Locker Room
During the course of locker operation, if any jewellery item or important looking
document is found unattended in the locker room, the CSD or any staff assigned to look
after locker operations should immediately inform the Head CSD/Operation In-charge
and the Branch Manager without checking anything personally. Then a team consisting
of Branch Manager, CSD Staff and Operation In-charge or Head CSD should
collectively check and list out each and every item found unattended in the locker room
in a paper and it is to be signed by all the officials present. Then the items along with the
paper containing the list of items should be packed in a sealed envelope or a lockable
box and placed inside the vault. Only the nominated staffs should attend the locker room
for the said task and no information should be shared among other staffs of the branch.
The branch should then check the locker Access Register to find out the locker holders
visiting the locker room on that particular day. Those locker holders should be informed
to check their belongings kept inside their locker compartment to find out anything
missing. When informing the customers, no information should be given about the items
found. It is thus better to assign the job of calling the customers to a staff, who only
knows about some items found unattended in the locker room, but has absolutely no idea
about the items found.
If any customer claims about missing any items from his locker compartment and claims
that the items found was his/her, he/she should be requested to submit a written
application also providing the list of items missing in his/her locker compartment.
He/she should also be asked to provide documents to support his/her claim, which could
be tax invoice of the jewellery, his/her photograph with the jewellery etc. In case of
documents, customer could be asked to provide contents of documents or the like.
After checking the details of missing items claimed by the customer along with the
supporting documents matches with the list of items found unattended in the locker
room and the branch is confident about the genuineness of the claim, the branch can
forward request for approval through memo to Central Operations Department to obtain

59
After obtaining approval from the competent authority, branch can handover the items to
the claimant by preparing a handover takeover document listing out the items and
obtaining signature of OI/Head CSD and BM on behalf of bank and the customer as
acknowledgement of receipt.
1.6.6 Loss of the Locker Key
• In case of loss of key by the Locker Holder, he/she should personally visit the branch
and notify in writing, the signature on which should be verified by the branch.
• The locker should not be operated by duplicate key under any circumstances.
• In case of loss of the key, the locker door should be broken and door lock should be
changed.
• A memo is to be initiated by the branch with necessary details to obtain approval from
COO or higher authorities to break-open the locker.
• After approval, the Branch Manager along with the Locker Holder, CSD–In-charge/OI
and a Security Guard must be present at the time of break-open of the locker.
• A list of locker contents should be prepared. Locker Holder‟s acknowledgement of
receipt in the list of the contents should be obtained after handing over the locker
contents to the Holder.
• All expenses related to breaking-up of the locker and getting the fresh key plus other
charges (if any) should be recovered from the Locker Holder.
1.6.7 Non-Payment of Locker Rent
• The locker rent is normally taken in advance. Upon completion of the rented period, if
the key is not surrendered to the Bank, the same is automatically renewed for another
period. In such case, the client‟s account should be debited to recover the rental charge
for the renewed period.
• Once the rental is due and cannot be recovered, the locker operation should be stopped
and a note having such remark should be attached in the Locker Access Register.
• In case the balance is not sufficient in the account to recover the rental charges,
reminders should be sent to the Locker Holder and adequate efforts should be made to
contact the client through any means of communication (telephone, fax, email, post etc.)
possible.
• If the bank fails to receive any positive response from the Locker in spite of all efforts,
final reminder allowing a specified time period (15 days) to claim the contents of his/her
locker should be posted, which should also include notification that the bank can start
the forced recovery action if the outstanding dues are not paid to the bank.
1.6.8 Break-Open of Locker upon Non Recovery of Bank Charges
• A memo should be initiated seeking approval from COO or higher authorities to break-
open the locker forcefully due to non-realization of the Bank‟s dues.
• Upon tanking approval, following officials / representatives to be present while breaking
the locker:
• CSD In-charge/OI/ABM

60
• Branch Manager
• Representative from Head Office preferably from Internal Audit Department
• Representative of NRB
• Representative of Local government (ward, municipality etc. as applicable)
• Representative from the local police authority.
• Allowance to the representatives excluding the Bank staff shall be provided as per the
Financial By-Laws of the Bank.
• A list of locker contents should be prepared and certified with the signature of all the
officials / representatives present. The locker contents must be kept safely inside the
vault.
• The contents then should be disposed of as per the agreement for the operations of the
locker with appropriate management approval.
1.6.9 Surrender of Locker
• If a Locker Holder desires to surrender the locker, he/she has to submit an application
(specimen 56) for surrender of locker together with the Key should be obtained from the
customer.
• The applicable charge as per standard bank charges is to be recovered from the account.
If the rental is due and remains unrecovered, the same should be recovered from the
Locker Holder. However, if the locker rental is already paid in advance, the rental
amount for the unused period will not be refunded to the locker holder.
• The Bank should ensure that the locker has been fully vacated by the Locker Holder
before receiving the key.
• Upon completion of required formalities and receiving the key, the key deposit held as
Locker Margin should be released to the Locker Holder‟s account.
1.6.10 Death of the Locker Holder
• Any transactions into the account of the Locker Holder should be stopped immediately.
• Death Certificate of the deceased person and relationship certificate with the nominee
or claimant issued by the concerned government authority to be obtained.
• 35 Days‟ Public Notice containing details of persons deceased, name of the
claimant/nominee and relationship of claimant/nominee with the deceased person
should be published in consultation with Legal Department in a national daily
newspaper. The notice should also include that if nobody claims his rights over the
contents of locker within 35 days from the date of notice, same shall be disposed to the
claimant/nominee.
• If nobody appears with evidence within 35 days‟ time, the locker contents shall be
disposed to the claimant/nominee keeping necessary records and obtaining
acknowledgement of such disposal.
• If more than one person claims within stipulated time, it will be solved legally with the
court order.
• In all circumstances above, disposal of locker contents to the claimant/nominee should
be made only after the approval of COO or higher authorities.
• If the locker holder is unable to submit the locker keys, procedure of breaking open the
locker is to be followed.

61
• All the expenses incurred in this process such as breaking open the locker or charges
incurred for publishing 35 days public notice have to be borne by the claimant/nominee.
1.6.11 Risk Grading & Customer Due Diligence for Allotment of Lockers
• Risk grading of the Locker Holders and Customer Due diligence must be carried out for
existing customers as prescribed by AML – CFT Policy/Procedures of the bank
according to risk grade of the account.
• In case the lockers have remain un-operated for more than 3 years, the Locker Holder
must be contacted immediately and advise him either to operate the locker or surrender
it. This exercise to be carried out even if the rent is being paid regularly. The Locker
Holder should also be asked to give in writing the reasons for non-operation of the
locker. In case the customer has genuine reasons as in case of NRNs, out of town for
jobs etc., bank may allow him/her to continue with the locker.
• In case the Locker Holder neither responds nor operate the locker, bank should consider
break-opening the locker after giving due notice to him.
• Any changes in address, signature, and phone number etc. of the Locker Holder must be
immediately informed to the Bank.
1.7 Blacklisting
Blacklisting is a process of enlisting an account holder in the blacklisted database of M/s
Credit Information Bureau if he/she/they has/have issued cheque to any party but the payee
of the cheque could not get payment of the cheque, mainly due insufficient balance
maintained in the account.
As per NRB Directives No. 10.2 of E. Pra. Nirdeshan No. 12/078 as per Unified
Directives 2076, the bank should blacklist its account holder in following cases:
1) If the account holder issues cheques to any party without maintaining sufficient balance
in the account.
2) If the account holder has closed any account before all the cheques issued from that
account have been paid/realized. Similarly, if the account holder does not submit
remaining/outstanding cheques at the time of closing the account, but later on issues
such cheques.
3) If payment of any cheque has been stopped on the request of the account holder without
furnishing valid reasons such as cheque has been lost, cheque is in possession of
unauthorized person etc., if such cheque is presented in the counter later on and gets
returned.
4) If cheque has been issued by the a/c holder affixing wrong signature. In this case, 2
days‟ legal notice is to be issued to the account holder. If the customer does not issue
another cheque to make payment to the payee within 2 days‟ time period, another
request letter is to be obtained from the payee confirming of not receiving payment yet
and again requesting to blacklist the account holder. The date of first request letter is to
be quoted in this second letter. Cheque issued with invalid date should also be treated
wrong signature and same process is to be followed.

62
1.7.1 Conditions for Blacklisting:
1) The payee has to submit a written request letter to the bank for blacklisting the account
holder by clearly mentioning the term Blacklist the a/c holder (drawer). In other words,
just requesting to take action against the a/c holder or the like is not enough.
2) The name of account holder, account name, cheque book, amount of cheque and reason
for blacklisting, such as insufficient balance, wrong signature, account closed, cheque
stopped etc., should also be mentioned.
3) Full contact details of the applicant are to be obtained, which includes mobile number,
email ID and full mailing address.
4) The payee must be self-present to submit the written application. Any request from
third party should not be accepted. However, if it is a bearer cheque, it is possible that
the payee might have given the cheque to another person. In this case, the third party
becomes the ultimate beneficiary of cheque amount and he/she can apply for
blacklisting the drawer, but the original payee must provide letter about handing over
the cheque to ultimate beneficiary in writing to enable him to put up blacklisting
request. Similarly, if payee is a company, an authorized agent can submit the request
letter to the bank.
5) If payee is an individual, he/she also has to submit a copy of his/her citizenship
certificate/Passport/PAN card, which needs to be verified with the original copy.
Similarly, if payee is a company, registration certificate or PAN certificate is to be
submitted.
6) The payee should submit the application within the validity of the cheque, i.e. within 6
months from the cheque issue date. Any request received after the cheque date crossing
6-month time should not be entertained.
7) Before submitting the application for blacklisting the account holder, the payee must
have presented the cheque for collection or for encashing at the counter (for bearer
cheques) at least 2 times. There should be gap of at least 2 working days between the
two presentment dates. To clarify, if any holiday lies after the 1st
presentment of cheque,
the cheque should be presented for the 2nd
time only after 2 days not counting the
holidays.
8) As soon as a valid request for blacklisting is received from the payee, the account of the
account holder should be debit frozen. The account holder should also be informed
about the blacklisting request received against him/her/them through fastest means of
communication such as phone call, SMS, email etc.
9) If drawer (a/c holder) is a firm/company, following parties are also to be blacklisted
along with the firm/company:
a) Sole Proprietor in case of a Proprietorship Firm
b) All partners in case of a Partnership Firm
c) All Directors and person and/or Firm/Company holding 15% or more shares in case
of a Private or Public Limited Company
10) After the payee submits the application for blacklisting, if the payee again requests for
withholding his/her/their request for some time, such request should be obtained in
writing. Blacklisting process should not be postponed just on the basis of verbal request
only. Similarly, if the blacklisting process is held through written request of the payee

63
and later the payee again request to carry on with the blacklisting request, such request
should be obtained in writing.
11) Branches should process the blacklisting requests with priority as delay in process
could result in imposing fine/penalty to the bank by NRB.
12) After informing the account holder about blacklisting request, if the customer does not
respond by either depositing the cheque amount or gets the payee withdraw his request
within 3 working days, the branch should carry on the blacklisting process by issuing 7
days legal notice.
13) After 7 working days have been completed, the payee is to be requested to again
present the cheque again for collection for the 3rd
time. In this case also, holidays
should not be counted for considering elapse of 7 working days. If it is a bearer
cheque or the amount of cheque is less than Rs.1,000,000/-, the cheque can also be
presented at the counter after getting the endorsements on the back of the cheque of
previous collection cancelled from concerned bank.
14) During the time period of 7 day‟s legal notice, if the account holder deposits the
required amount in the account and submits a request letter to withhold the
blacklisting process, the branch should issue a letter to the payee mentioning that
since the account holder has deposited required amount in the account, the bank is
unable to proceed the blacklisting process any further. The payee should also be
requested to collect/encash the cheque for getting the payment.
15) If the a/c holder deposits the cheque amount in the account, the blacklisting process
cannot be carry forwarded even if the payee does not accept to withdraw the cheque
amount and cancel his/her blacklisting request mentioning that he/she has some more
money to recover from the a/c holder or the like. In case of delay in getting response
from the payee, after obtaining request from the a/c holder to hold the cheque amount,
the cheque amount should be lien marked (held) in the account with proper remarks
and transaction can be allowed in the account. The amount so held cannot be used for
any other purpose, but to make payment to the concerned payee only.
16) If the cheque fails to get collected/encashed even after the elapse of 7 working days
of legal notice, the branch should forward request in memo to Central Operation
Department for taking approval from CEO.
17) If the customer is also availing credit facility from the bank, branches are to take
consent of Province Manager to carry on the blacklisting process by requesting
through email. The consent of PM so received also has to be attached with the request
sent to Central Operations for approval. If taking consent of PM is getting delayed,
the branch can consult with Central Operations Department for necessary
coordination.
18) After receiving approval, branch should then forward the request with required
documents to CIC Unit of Credit Administration Department (CAD) for sending
online request to enlist the customer in blacklist database of M/s Credit Information
Bureau.
19) After the confirmation is received from the CIC Unit about the account holder being
blacklisted, the account has to be debit frozen and no transaction should be allowed
except for depositing amount in the account until he/she/it is released from blacklist
database of CIB.

64
The conditions and procedures for blacklisting an account holder have been provided in
detail in Serial No. 10.2 of NRB‟s Unified Directives No. 12/078.
1.7.2 Releasing from Blacklist:
1) After the account holder has been blacklisted on the request of payee due to cheque
gotten dishonoured, if the payee later visits the bank and requests to release the
account holder from blacklist database of CIB, the branch can forward the request to
Central Operations Department to take approval from the competent authority.
2) Branch has to ensure if the request for releasing the customer from blacklisting has
been obtained from the same payee or ultimate beneficiary (in case of bearer cheque)
by verifying the signature of the application with the signature done in the previous
request for blacklisting and by obtaining a valid ID card.
3) In the request letter of the payee, it should be clearly mentioned that he/she has
received the payment of the due cheque amount from the account holder and now
wants to release the account holder from blacklist database of CIB.
4) The branch should ensure the account holder deposits or maintains blacklisting release
charge as well as previous blacklisting charge, if the branch had previously booked the
blacklisting charge in the Miscellaneous Expenses account due insufficient balance in
the account.
5) After getting approval for releasing from blacklisting through Central Operations
Department, the branch should forward the request to CIC unit to delist the customer
from blacklist database of CIB. After its confirmation is obtained from CIB through
CIC Unit of CAD, the debit freeze of the account can be released to allow the
customer to do transaction in the account.
1.8. Waiver in Fees & Commission / Transaction Reversal & Deletion
• Any deviations/ waiver in fees and commission except credit related fees and
commission is to be approved from COO or higher authority.
• Any deviations/ waiver in interest/ coupon rate related to deposit is to be approved from
COO or higher authority.
• Transactions related to debit of income and all transactions related to reversal
(rectification) of error must be approved by COO or higher authority.
1.9. Safe Keeping of Bank Stamps
A company stamp is a tool of authenticating letter, report or any document issued by a
company and is an important part of signing any agreement.
 It is found that some people are showing fake Balance Certificates or Account
Statements to foreign colleges or Embassies to portray their good financial position, but
in an unethical way. These things come to light only when such institutions send email
to the bank for verifying the authentication of such documents. Such type of events can

65
hamper the reputation of the bank. There is possibility that signature of authorized
signatory/ies of the branch could be forged in fake documents, but copying company
stamp is relatively difficult.
 Hence, to avoid such incidents to happen that can arise due to misuse of stamp, branch
needs to safely keep all the stamps such as company stamp, cash transaction related
stamps etc. For this, after closing of business hour, all company stamps should be kept
in a locked cabinet/drawer.
 During the course of time, stamps of the branch become faded and useless due to
continuous wearing and tearing. When branch receives new stamps as replacements,
branch should maintain record of all old stamps in a register prepared in the format as
per Specimen No. 67 and keep all stamps in a sealed envelope inside vault. A copy of
the register should be kept inside the envelope of the stamps so that they could be
verified later on.
All old and obsolete stamps already present at the branches that are no more in use are
also to be recorded as mentioned above and kept in vault.
 Old stamp kept in vault should be destroyed on annual basis or at the time of Internal
Audit in presence of following representatives of the bank:
 Branch Manager
 The staff assigned the responsibility of using the stamp
 Representative from Internal Audit Department
 A register should be maintained to record details of destroyed stamps in the format as per
Specimen No. 68.
1.10. Miscellaneous
• The balances in the accounts should not be disclosed unless the identity of the account
holder is established and only after verification of account holder‟s signature.
• In case of inquiry made through authorized representative of the account holder the
balance should be handed over in a sealed envelope.
• Branches should use the Correct Transaction Code as per the Transaction Type for
proper recording and correct reporting of transactions as per memo dated 04/01/2018.
(Specimen No. 57)
• In case of Legal entity‟s account, thumb impression of signatories‟/ account operator
shall be obtained in account opening form and KYC form.
• Branches are not allowed to issue cheque in Call Account. Branches are requested to
open separate Current/Savings accounts for existing Call Account Holders for
transaction purposes and provide sweep in facility (Specimen 54) if needed.
• Staff should avoid cutting and overwriting as far as possible. If there be any cuttings and
overwriting, then it should be properly authenticated with full signature there on. In no
way correcting fluid will be used.

66
• While entertaining any request or instruction of the client, necessary charges as per the
prevailing rates are to be recovered by debit of the clients account. Mention the amount
charged on the face of the application form.
• Account Maintenance report should be prepared on weekly basis and reported to COO.
• Branches should compulsorily display the banks fees and commission details on notice
board and are reminded to set up the information and grievance handling desk as per
bank‟s Customer Satisfaction Guidelines and follow the bank‟s Complain Handling
Process.
• Branches are not allowed to open two similar natures local currency account of a single
natural person. Also branches are not allowed to issue more than one Debit or Credit
Card to single person.
2. Cash Department
Functions of Cash Department includes Maintenance of Cash, Cash receipt at Counter, Cash
Payments of cheque, Return of cheques, Unidentified Deposits account etc.
Each Teller at the cash counter should greet all our customers with “NAMASTE AND
SMILE” compulsorily with two palms joined together or a closed hand.
2.1. Maintenance of cash
2.1.1. Limit of Cash at Vault
Cash balance at vault should be maintained at optimum level. Optimum level of cash
refers to ideal cash level required by the branch to carry out its daily cash transactions
without interruptions. However, excess cash in vault not only imposes risk of theft, but
also carries opportunity cost to the bank for being in idle state, which could have been
invested to get return or save cost. It is the responsibility of Branch
Manager/ABM/OI/Head Teller that cash held are within insurance coverage limit and at
minimum required level. Treasury Front Office, HO should regularly monitor that total
cash balance of the bank held by branches is optimum.
If cash exceeds the insurance limit, an intimation of that will have to be sent to the
Insurance Company, General Service Department and Finance Department by the Head
Teller/OI/ABM/Branch Manager. It is the responsibility of the Head
Teller/OI/ABM/Branch Managers to see that cash does not exceed the insured amount. In
case cash exceeds the vault limit, immediate arrangement has to be made for either
depositing the excess cash at Nepal Rastra Bank or Note Kosh account or lent to other
banks through treasury deal. If any of the above arrangement could not be made, insurance
limit has to be increased to provide coverage for excess cash limit.
Branch should ensure that the Cash at Vault, Counter & ATM is within the insured limit
under BBI policy. Further, Branches should be aware of the insurance limit of cash at
vault and Gold Insurance as per Banker‟s Blanket Insurance (BBI) Policy and ensure that

67
the limit covers the cash as well as gold at vault at all times. The Branch Manager/ABM
& Head Teller/OI should ensure that their cash in vault, cash in ATM and gold in vault
always remains within the BBI insurance limit. In case the cash and gold balance exceeds
the BBI limit, the excess vault limit should be instantly intimated to the concerned
insurance company and GSD with CC to Head - Central Operations Department. The BBI
insurance limit shall be revised from time to time and informed to branches accordingly
for implementation.
2.1.2. Procedure
• At the start of day, Operation In-charge or Head - Teller will take out required cash
from the vault and distribute to the teller/s after taking his acknowledgement. The
amount given to the teller should be recorded in the system as well.
• Vault In and Vault Out of cash and cash equivalents must be conducted in the presence
of dual staff members and record of the same should be maintained on vault book (vault
in & vault out time) for all proceedings on daily basis.
• The teller at the time of receiving cash from the vault or Head Teller/OI must check all
the cash handed over to him/her to ensure the amount received by him/her is in good
condition and is as per the denominations recorded in vault book. If He/she deems it
necessary, he/she shall count all the loose denomination notes for confirmation.
• The teller while receiving cash from customer should properly count the cash and check
if the physical cash tallies with the denominations mentioned by customer in cash
deposit voucher. Similarly, while making payment of cash to the customer, the teller
must note the denomination of cash being paid on the back of the cheque/instrument
and hand over the cash to the customer.
• While making payment of the cheque, two signatures of the customer are to be obtained,
one at the time of receiving cheque and one at the time of making payment after writing
denominations of notes being paid on the overleaf of the cheque. The teller staff should
ensure that both the signatures tally.
• While accepting deposit, mutilated, soiled or cut notes must be kept separately and
should not be included in re-issuable notes. In no case, such notes should be given to
customers. Instead, separate packets of soiled notes should be made for making deposit
at NRB or Note Kosh account. Notes that are damaged beyond recognition or cut
without having complete serial numbers on both sides thus losing their full monetary
value should not be accepted.
• After closing of the counter, the teller should count all the loose cash and make packets
of 100 notes and make bundle of 10 packets (1,000 notes) of each denomination
according to the notes available with them.
• The teller should put on note tag/strip on each packet with the help of rubber band and
write his/her name, affix signature, date and bank stamp on the packet.
• Then, the teller should write the number of notes of each denomination in the excel
sheet to calculate total physical cash available with him/her.
• It is to be ensured that the teller cash account in the system is always Nil at the end of
the day. If coin is found excess in the system, coin received entry is to be made in Cash
Excess account. Similarly, if coin is found short, it has to be recovered from the Teller
by debiting his/her account so that cash balance in the system is in whole figures and

68
not in decimals. Daily cash position report is to be printed out and filed accordingly at
the end of the day.
• After ensuring all the transactions have been posted, the teller then has to tally his/her
physical cash balance with the balance shown in his/her teller account in the system. If
the cash balances are found equal, he/she should make cash summary of each
denomination and hand over the physical cash to the Head Teller/Operation In-charge.
• After the entire cash is handed over by the teller, the Head Teller/OI should also count
the loose notes and ensure 10 packets are available in each bundle of notes. If it is
found OK, the OI/Head Teller needs to acknowledge the receipt of cash in the cash
transfer register and the system.
• Then after, number and amount of each denomination of notes both NPR and FCY
currencies is to be filled up in the Vault Book and Cash Register at the end of the day
and signed by concerned staffs by proper verification.
• Vault in, vault out and cash position should be printed and signed by the concerned
staffs without fail and separate file is to be maintained.
• After cash are received from all the tellers and physical cash balance with the vault cash
balance, the cash is to be deposited at the vault by properly recording the cash
denominations in the Vault Book.
• At the end of each day, the authorized key holders/officers after checking the cash will
sign the daily vault book in token of verifying that the cash is kept in the safe/vault and
is within insured limit.
• At the end of day, the teller should print the transactions list and put all the cash
deposited vouchers, cheques and other vouchers according to the order they appear in
the transaction list. During this process, the teller should also check if there is any
wrong entry made.
• After all the vouchers are compiled according to the order of the transaction list, a
summary ticket should be stitched and TL should be signed by the Teller and handed
over to the Head Teller/Operation In-charge for checking.
• The Head Teller/OI should again check all the transactions done by the teller by
verifying the vouchers/cheques with the TL entry and ensure amounts and account
number entered are correct. He/she should also check details of vouchers/cheques are
correct and whether postdated or stale cheques have been paid. If any error found in the
vouchers, corrective entries should be made immediately after taking approval from
COO or higher authorities through Central Operations Department.
2.1.3. NRB Clean Note Policy 2073
NRB has recently amended its Clean Note Policy 2073 vide its circular dated 2077.02.11
B.S. Key provisions of the circular have been discussed below:
1) Notes received by Banks are to be sorted and segregated into following 3 categories and
note tags of respective colours should be used:
a) Notes Good to Refill ATM: Green coloured note tag/slip should be used for
binding packets of such notes. This category of notes includes either fresh or the
cleanest notes that can be used to refill ATM and also to make payments to
customers.

69
b) Notes Good For Circulation Through Counters: White coloured note tag/slip
should be used for binding packets of such notes. This category of notes includes
sorted notes that can be used to make payment to the customers or deposit at NRB
as good notes.
c) Notes Not Good For Circulation: Red coloured note tag/slip should be used for
binding packets of such notes. This category of notes include those that are old,
burnt, torn down, wet, misprinted, mouldered, tarnished with colour or ink, notes
with picture of former Kings etc. These types of notes cannot be used to make
payment to the customers and should only be deposited at NRB.
2) In every type of note tag/slip used to bind the note packets, as mentioned above,
following details is to be mentioned:
a) Name of bank, branch name and stamp
b) Name and ID card no. of note counting staff and his/her signature
c) Note counted date
3) While binding notes, no stitch should be used. Instead, rubber, plastic or paper bands
should be used. Similarly, cleanliness of notes should be maintained by avoiding any
type of writing or tearing of the notes. Customers should also be encouraged to
maintain cleanliness of notes.
4) Banks should take appropriate measures to disinfect notes before circulating or before
making payment.
5) Cleanliness should be maintained in Cash vaults, cupboards, vault room, boxes etc. that
are used to store and transferring notes. Further, there should be good lighting system
and installation of exhaust fan at vault room and cash counters.
2.1.4. Cash in Transit
• Cash in transit refers to the state of cash being in transit on the way to or from Nepal
Rastra Bank, Note Kosh account maintained bank, ATM, other branches of own bank
or branches of other banks.
• Carrying of cash in transit for deposits or withdrawals should be handled with utmost
care.
• While carrying cash to branches, Note Kosh or Nepal Rastra Bank for deposits and
withdrawals, it must be within the insured limit of BBI and must meet the conditions
of CIT for insurance coverage. The Branch Manager/ABM/OI will ensure that the
cash in transit remains within limit as prescribed by the Management/Insurance
Company.
• While sending cash in transit for deposit, bait money containing at least 20 notes
should be recorded of Rs.1,000/- and Rs.500/- out of notes sent in transit.

70
• The amount of cash received from /sent to the branches, Note Kosh, Nepal Rastra
Bank is to be recorded. Similarly, branches which are depositing cash at NRB directly
are also required to prepare and send the IBT advice to Finance Department/Treasury
Back Office.
• CIT Register (Specimen 38) shall be maintained for recording movement of cash in
transit.
• Branch Manager/In-charge/ABM/OI should ensure that any cash out from the branch
to other branch/other bank/NRB/ATM has been booked as Cash in Transit (CIT) in
the system before the cash is taken out from the Bank Premise. Approval from
Central Operations Department must be obtained for booking amount in CIT account.
• Similarly, Cash in Transit should be booked at the time of signing the cheque for cash
withdrawal from the local Nostro Bank or NRB.
• The CIT transaction voucher and/or the entry in CIT register shall be signed by the
CIT accompanying staffs and the security guard. Accompanying security guard must
carry Khukuri during the transit period.
• Branch Managers/ABMs/OIs of outside valley branches must remain in close
communication with the CIT accompanying staffs as well as with the local police
office so that any risk arising during CIT can be informed immediately.
• CIT limit under BBI has been done for Rs.11.25 Crores. The CIT insurance coverage
of Rs.11.25 Crores is CIT exposure at any point of time during office hours
cumulative of all the branches. Therefore, while asking CIT approval from Central
Operations Department, Branches should check whether there is any CIT outstanding
in GL.
• CIT amount shall be revised from time to time as per management decisions and
communicated to branches accordingly for implementation.
• CIT should be reversed ASAP once the transaction has been completed and the cash
has reached the destined place.
• During cash in transit between branches, the cash giving branch should always verify/
confirm the proper identification of staff coming to receive the cash with his/her
CBIL staff I.D. No. and Signature. On the other hand, the cash receiving branch
should also carefully verify the physical cash with the denomination notes mentioned
in the letter before acknowledging its receipt.
• Similarly, while lending cash to other banks through treasury deal, the name and ID
number of staff of other banks receiving cash should be noted during treasury deal
process, which needs to be verified during actual handing over cash to him/her. The
denomination of cash given should be recorded in the letter received from the bank
and signature of the cash collecting staff is to be obtained as a token of acknowledge
of receipt.

71
2.1.5. Withdrawal from Nepal Rastra Bank/Nostro
• The teller withdrawing cash from Nepal Rastra Bank and Nostro account should
count the cash properly before leaving their counters. Any shortage of cash brought
from Nepal Rastra Bank and Nostro will be the responsibility of the concerned staff.
• On receipt of cash from Nepal Rastra Bank, packets of different denominations are to
be counted and properly recorded by the Head Teller/OI.
2.1.6. Verification of Cash and Security Items
 Branch Manager is required to verify physical cash balance of every denominations
kept at vaults (day and evening) and fire proof cabinet (if being used as evening vault)
once a month. The date of surprise checking can be any day of a month of Nepali
Calendar. After checking the physical cash, if cash tallies with the cash balance
mentioned in the vault book and Finacle CBS, he/she should state as, “Verified
Physical Cash Balance With Record of Vault Book and Found OK” and affix his/her
signature with date of checking. If any deviation is noted in cash balance, it should be
immediately reported to Head Office.
 Similarly, BM is also required to check physical balance of security items such as
Cheque Book, MC Cheque, Loose Cheque, INR Draft, FCY Draft etc. and affix his/her
signature with date by stating, Physical Balance Verified With System Record”.
 Surprise physical verification of the entire cash including the foreign currencies will be
carried out by Internal Audit Department during branch audit and as and when required.
The report should include detail of any difference noticed and status of mutilated and
unusable notes.
2.1.7. Cash Short/Excess
Following measures should be followed for any cash short/excess noticed during the day.
• For any cash short/excess exceeding Rs.1,000/-, it should be immediately intimated to
the COO or Head – Central Operations in case of leave of COO and approval should be
sought from COO or Head – Central Operations in case of leave of COO for booking
the amount in Cash Short account in case of cash short and in Cash Excess account in
case of cash excess. The name of concerned staff should be entered while booking the
cash short/excess amount.
• In case of cash short/excess found, through checking of physical cash, voucher entries
as per TL of the concerned teller has to be done and CCTV footage should be
monitored to trace the transaction that has resulted in such shortage/excess.
• Branch should settle the booked cash short amount within 7 working days.
• If the transaction could not be traced out or shortfall cash cannot be recovered even
after tracing out the transaction with 7 working days, the cash short amount will be
recovered from the concerned staff according to the decision made by the management
from time to time.

72
• The amount booked under Cash Excess account should never be debited for adjusting
cash shortage found in teller account on any day.
• At the end of Fiscal Year, the balance of Cash Excess booked shall be transferred to
account head “Operation Related Other Income”, after obtaining the approval from
COO or higher authorities and the proper records of the same shall be maintained.
• If any claim for the excess cash already booked as income is received in the next year,
after obtaining supporting documents/evidence justifying the claim, the payment can be
made to the customer, but only after taking approval from COO or higher authorities.
• If the excess cash already booked as income is returned to the customer, as per the
immediately preceding clause, then the same will be booked under the Head Others
Expenses.
2.1.8. Bait Money or Bait Bills
• Bait bills are bills whose serial number is recorded by the bank either by making a copy
or by listing in a log book. During a bank robbery if robber has taken the bait money,
details of this can be passed on to the police. If the money is found in the possession of
someone or while being used to purchase goods then it is often easier to find the
perpetrator of the bank robbery. When the bait money has left the bank premises, it is
known as hot money.
• Branches should do as follows regarding the Bait Money:
• Take memo approval from Head Operations/ Operations In-Charge/COO or
Higher Authority in chain listing the complete serial numbers of 100 pieces of
notes (denomination of NPR 500 & NPR 1,000) which are kept in the teller
counter during the day-time and inside vault during day-end. Staffs are to make
sure that these notes aren‟t paid to the customers. The cash kept as bait money
should be reviewed/changed by the branch from time to time [i.e., quarterly / half
yearly/ yearly] by taking approval from Operations Department.
• Similarly, arrangement should be made for keeping Bait money in evening vault.
Branches providing Evening Counter need to keep Bait money in evening teller
counter and inside evening vault after vault in. Branch shall obtain approval for
bait money of Day and Evening vaults from a single memo by with providing
separate list of notes of bait notes of the two vaults.
• While sending Cash in Transit, branches should record serial numbers of at least
20 pieces of notes (denomination of NPR 500 & NPR 1,000) in the Cash in Transit
Register before moving any cash out of the Bank premises.
• In case of deposits of notes below denominations of NPR 500; the number of 20
pieces of notes of highest denomination shall be recorded.
• Bait notes should not have any distinct colored tape, notification, or any unique
wrapping to differentiate them from other notes. The notes should be similarly kept
as other notes without creating any suspicion.

73
2.2. Cash receipt at Counter
• While delivering cash to the Teller, the Head Teller should record the amount in the
Tellers Register (with details of denominations) and enter the amount in computer as
token of having delivered/received the same by the Teller.
• On receipt of Deposit Voucher with cash from the customer, teller staff has to count
the cash and note/check denominations of physical notes with the denominations
mentioned on the Deposit Slip and compare the total amount with amount in figures
and words. Denomination of cash for deposit has to be compulsorily filled on the cash
voucher by the customer.
• Voucher should be written either in Nepali or English language only. No dual
language or dual ink should be used. The voucher should always bear the date of
deposit.
• Deposit slip should be signed by the customer or thumb impression obtained. No
deposit should be made in customer‟s account by mentioning depositor/conductor as
staff.
• Validate Deposit Slip by affixing “Cash Received” Stamp noting amount and putting
signature there on.
• If any person other than the account holder wants to deposit cash in the account, then
the branch must obtain documents and details furnishing the identity along with
purpose of deposit from the depositor for cash deposit above NPR 1 Lakh.
• Make necessary entries in the system to credit the deposited amount in the concerned
account by entering required information or transaction details.
• Return validated receipt to the Customer with system print on deposit voucher.
• If cash deposit entry is above the Teller's Authority, apart from the above precautions
the following additional procedure is to be adopted:
i. Submit Deposit Slip to Head Teller/OI/ABM/Branch Manager as the case may be
for approval of Transaction after counting and receiving the cash. The Deposit
slip should be marked with signature of Teller/ and the approving authority.
ii. Be sure that the Transaction is approved by the Competent Authority and system
print is generated before Deposit Slip is handed back to the Customer.
iii Validation of deposit slip is to be carried out as per the limit specified by the
management from time to time. In case of cash deposit exceeding 1 Million,
source of fund is to be clearly mentioned in the deposit slip as per the KYC Policy.
For the deposit being made in the Morning, Evening or Holiday counter, the Staff/Teller is
entitled to counter sign the deposit slip of any amount.
• For receipt of any other instrument other than cash for deposit to the customer account,
all the procedures specified above to be followed to the extent possible and required.
• There should not be dual language used or dual ink used in the deposit voucher. The
amount in figure and words should be written correctly. The deposit voucher should
bear the date on which it is presented for deposit. Any correction made in the voucher
should be authorized by the depositor by affixing his/her signature.

74
• Cash deposit /account transfer modality may be changed as instructed by NRB from
time to time and same is to be strictly complied with without any deviations. KYC
details, details as required by goAML, NRB reporting or any other requirement of
regulator body needs to be entered correctly without fail.
2.3. Payment of Cash
The teller at the time of paying cash against the Cheque should ensure that all the
procedures laid down hereunder have been fulfilled before making the payment. The
Payee of the cheque should be required to sign on the back of the Cheque at the time of
presentation of cheque at the counter.
Scrutinize the following points in the Cheque :-
• When cheque is presented in the counter, before rushing to make the entry, the Teller
should first check if the details of the cheque is correct or not.
• Date on Cheque should be valid. Postdated (future dated) or Stale Cheques (date more
than 6months old) should not be accepted.
• The amount written in figure and words should tally.
• No cash payment should be made over the counter if Cheque is crossed. Cheque is
crossed either by drawing a parallel line on the top left corner, by writing & Co. on the
top left corner or writing A/c payee written. (Drawing parallel lines with or without
writing & Co. means that the cheque should not be paid over the counter, but could be
deposited to the account of payee or any other their party with endorsement of payee.
On the other hand when A/c payee is mentioned on the cheque, it amount should only
be deposited on the account of the payee and it is not transferable).
• Order cheque can only be paid over the counter only upon verification of proper
ID of the Payee.
• Any correction made on the cheque should always be authorized by the drawer
by affixing his/her full signature/thumb impression. Initial signature cannot be
acceptable.
• While making correction on the cheque, customer should be informed to draw a
single straight line to cancel the error made and not to overwrite on the error to
make correction.
• Cheque with correction in both figure and words of the amount cannot be
accepted even if the customer affixes his/her signature. New cheque is to be
issued by the customer in that case.
• In case of an account of joint account holders or a company, name of payee
cannot be mentioned as „Self‟ and name of actual payee should be written.
• There should not be dual language or multi coloured ink used on the cheque.
• Stop payment cheque should not be paid.
• Cheques drawn in the name of Firm, Company, Institutions or Office of any
amount are always be A/c Payee and hence cash cannot be paid against such
cheques at the counter. Rather, they can only be deposited in their account.
• As per NRB directives, threshold limit for making cash payment against cheque
has been set as NPR 1,000,000/- (in words NPR One Million only) and cheque

75
drawn of amount equal to or above threshold limit should always be A/c Payee
and no cash payment is to be made over the counter.
In case of payment above one million presented with specific reason, an approval
of Central Operations Department is required and reporting to NRB on monthly
basis will be done by Compliance Department as per specimen format.
Ensure that the balance in the customer account is adequate for payment.
• Verify signature/sand stamp affixed on the cheque from specimen signature in the
system or Signature Specimen (SS) Card of the account and note account operation
instructions carefully.
• After accepting the cheque and verifying cheque details, signature and payment
instructions, the payee should be requested to sign on the back side of the cheque.
• If all the details of the cheque are found correct and signature is verified and account
also has sufficient balance, necessary entries should be made in the system for
debiting the cheque amount from the drawer‟s account by entering necessary details.
• While making payment, the payee should be made to affix another signature on the
back side of the cheque after carefully writing the denomination of cash being paid to
him/her. Two signature of the cheque bearer should be compared to ensure that
payment is being made to real payee.
• Special attention (as per KYC Policy) is to be given to big amount deposits being
received in new accounts and immediate withdrawal request from such accounts is to
be watched very carefully.
• The teller should affix “Cash Paid” Stamp on the face of the Cheque and mention
amount and sign there-on. Denomination of cash paid is to be compulsorily filled in
the backside of cheque. Check the identification document of the person presenting
the cheque (NRs. 1 Lakh and above) and attach the photocopy of identification
wherever required.
• In case payment amount exceeds the Teller's authority, apart from the above
precautions, the following additional procedure are to be adopted:
i) Submit the cheque to Head Teller/OI/ABM/Branch Manager, as the case may
be, for approval of transaction.
ii) Payment shall be made only after the Cheque is duly approved by the
Competent Authority and has affixed his/her signature on the cheque.
In case of insufficient balance in any account, the cheque must be reported to the
Supervisor or Branch Manager immediately so that he may refer to concerned authority
whether a Casual Overdraft is to be allowed to the party or the cheque is to be returned.
In case of insufficient balance found in the Savings account, the cheque should be
returned after informing to Head Teller/OI/BM.
• Cash payment against the letter of client should be avoided but may be made through
issue of loose cheques. The loose cheques/Debit Authority should be issued after
complying with all the procedures specified in Loose Cheque section.

76
• For payment of other instrument other than the cheques, all the procedures specified
above are to be followed to the extent possible.
• Cash Payment/account transfer modality may be changed as per instruction of NRB
from time to time and same is to be strictly complied without any deviations. KYC
details, details as required by goAML, NRB reporting or any other requirement of
regulator needs to be entered without fail.
2.4. Procedures for Sales of FCY Cash
Department/Branch shall follow the following steps for selling of FCY Cash:
• FCY sales form as per NRB‟s format (Specimen 44) should be filled up by the
customer.
• Photocopy of Passport (main page & signature page), Visa and Air Ticket must be
attached with FCY sales form and affixing the “Verified with Original” stamp on
these photocopies with signature of concerned staff there-on.
• The validity of Passport, Visa and Air Ticket must be verified with due care.
• If the customer is not maintaining account with the bank, a duly filled up KYC form
is to be obtained if FCY amount is equivalent to NPR 500,000/- or above.
• The amount of FCY requested by the customer should fall under the limits prescribed
by NRB‟s Unified Foreign Exchange Circular and amendments made thereof.
• After all the formalities are completed, the LCY equivalent to selling rate of FCY
should be received from the customer.
• For FCY cash sales of above USD 500/-, approval of BM is to be obtained.
• The exchange rate applicable for sales of FCY will be as per Bank‟s published rate
for the day. The Selling Rate of the respective currency must be applied for sale of
any FCY.
• On every sale of INR, Indian Currency Sales Receipt (ICSR) must be issued.
• In case of the account holder of the Bank, Customer account can be directly debited
or by the means of cheque for the amount required on request of the customer.
• The Passport and Air Ticket must be endorsed with signature and stamp mentioning
the sold FCY amount as per NRB circulars, before handing over to the customer. A
copy of the Passport and Air Ticket after endorsement is to be kept for record.
• After passing of entries in the system, FCY sales form along with the photocopied
documents should be filed separately. The reporting of FCY sold should be done as
per NRB Foreign Exchange Circulars in the prescribed format mentioning time and
date.
• Sales of FCY are only for Nepalese Citizens with Nepalese Passport.
• All the guidelines related to Sales of FCY must be followed as per NRB‟s Foreign
Exchange Circulars.
• No commission is to be charged for sales of FCY cash.
• For cash sales above USD 500, approval from Branch Manager should be taken.
However, maximum effort should be given to provide foreign exchange via card,
draft etc. to the customer.
2.5. Procedures for Purchase of FCY Cash
• The purchase of FCY cash should be done by complying with NRB circulars.

77
• The limit of purchase should be as per the restriction imposed by NRB.
• The rate for purchase will be as per Buying Rate mentioned in Bank‟s published rate
for the day.
• No commission is to be charged for purchase of FCY cash. However, if denomination
of FCY currency is below 50-unit note, service charge of 0.50% (on NPR equivalent
of total sum of FCY amount below 50-unit note) is to be deducted from the account.
This charge is subject to amendment in NRB Unified Foreign Exchange Management
Circular.
• If the FCY cash is to be deposited in the FCY account, then “Buying” rate should be
applied.
• NRB circulars should be reviewed from time to time for updates and amendments.
• On every purchase of FCY, Foreign Exchange Encashment Receipt (FEER)
(Specimen 45) must compulsorily be filled properly by the customer and customer‟s
copy shall be provided to the customers. Branches should also keep the record of
FEER on Excel sheet for future reference containing Date, Currency, FCY Amount,
Exchange Rate, Equivalent NPR amount etc. Red slip of the FEER shall be kept in
FCY purchase file, White slip shall be provided to the customer and yellow slip is to
be kept as a reference in FEER book.
• On every purchase of INR, Indian Currency Purchase Receipt (ICPR) must be issued.
• FCY in cash up to USD 5,000/- or equivalent other FCYs, per transaction, can be
purchased only on the basis of Valid ID Card, preferably Citizenship Certificate or
Passport.
• However, transaction amount of FCY purchase equivalent to NPR 500,000/- or above
falls under threshold of TTR reporting. Hence, KYC document of the customer must
be obtained. If the customer is maintaining account with the bank, FCY purchase
should be done after confirming KYC and other document are intact and up to date.
• For the purchase of FCY cash above USD 5,000/-, valid Passport and arrival date
must be verified. The Passport Holder must have visited a foreign country and date
of transaction should not exceed 35 days from the date of arrival in Nepal. FCY
above USD 5,000/- can be accepted after obtaining supporting document of income
and a declaration, as per the prevailing law, submitted by the customer at Immigration
Department of International Airport for the source of FCY amount.
• The customer can also open a FCY account or deposit the amount in existing FCY
account if he presents a valid passport with arrival date or amount received date (if
received inside Nepal) not exceeding 35 days prior from the date of transaction. For
depositing in account also, if the amount exceeds USD 5,000/-, a declaration of the
source of FCY amount submitted at Immigration Department of International Airport.
Arrival date can exceed 35 days if FCY amount to be purchased or deposited in FCY
account of amount is equal to or below USD 1,500/- or equivalent convertible other
FCY currencies, depending upon the source of FCY.
• Photocopy of Passport (main page & signature page) along with the arrival stamp
endorsed in the Passport by officials at Tribhuvan International Airport (TIA),
Pokhara International Airport or Gautam Buddha International Airport at the time of
arrival should be attached with the FCY cash purchase form/FEER form.
• FCY notes must be checked carefully by the concerned staff at RD to avoid probable
counterfeit.

78
• After all the formalities are over and the FCY notes are in order, it should be
encashed. The LCY equivalent is to be credited to the customer‟s account as per
customer‟s instruction or to be given in cash.
• The FCY cash purchase form/FEER is to be entered in the system. After approval
from higher authority, it must be filed for further reference.
• Foreign Exchange Encashment Receipt (FEER) is to be given to the customers after
every purchase.
• For cash purchase above USD 2,000.00 or equivalent FCY, the exchange rate must be
confirmed with Treasury Department.
2.6. Return of Unpaid cheques
• While returning cheques to the Client for any reason a Cheque Return Advice is to be
prepared in two copies and got signed by the Head Teller/OI giving there-in reasons
of returning the cheque. The original copy will be handed over to the person
presenting the cheque and his/ signature will be obtained on the duplicate copy of
cheque return advice and the same will be filed.
• Separate cheque return registers should be maintained by Cash as well as Remittance
/ Clearing section. This register should consist of following columns:
• Serial Number
• Date
• Account Number
• Name of Account Holder
• Name of Payee
• Cheque Number
• Cheque Amount
• Reasons of return
• Charges recovered
• Initials/Signature
• In case a cheque is to be returned, the same must compulsorily be brought to the
attention of Operation In-charge/ABM/Branch Manager through the Department
supervisor before dishonoring.
• A Cheque Return Register (Specimen 39) is to be maintained at the branch.
2.7. Unidentified deposits account
Deposit of any amount with wrong account name & number should not be accepted.
However, if the deposit is received and later found that the particulars of account holders
marked on the deposit slip do not match with the data in system, then these deposits are
to be credited in “Un-identified Deposit Account”. Before crediting the amount, branch
should try to contact the conductor/depositor of deposit in the contact number provided in
deposit slip or reference person, if available.
If it details could not confirmed by any means, following procedures are to be adopted for
Credit/Debit to this account: -

79
• No amount should be credited in Un-identified deposit Account without approval of
the Branch Manager.
• The amount should remain for a short period and should be attended to and dealt with
by the Branch Manager himself/herself.
• The amount should be refunded to the customer when he/she comes with proper
identity and details or credited in correct account as per his/her request. However,
payment is to be made only after obtaining approval of Branch Manager.
• While debiting this account and crediting client's account on receipt of complete
details, the following extra precautions to be taken.
• An application and identification is to be obtained from the customer along with
original deposit slip for reversal of entry from un-identified Deposit A/C.
• Signature of Applicant to be verified and the application to be sent to Branch
manager for authorization of debit.
iii) A monthly balancing to be carried out taking individual entries and report to be
submitted to COO or higher authorities. And a copy thereof should be submitted to
Internal Audit.
2.8. End of the Day (EOD) Operation
Branches should inform the IT department regarding the completion of their works on
daily basis via mail.
Before sending the notification of EOD, respective branch must ensure that all financial
and non-financial transaction are posted/ verified and balance of temporary parking
accounts such as Teller cash, IBT/ IDT, Inward Clearing, Outward Clearing, Outward
IPS etc. are made. However, if the pending transaction are yet to be verified, entered, and
same cannot be completed on regular/usual time, IT department should be notified by
email with tentative completion time. The time of completion of the posting/verifying of
entries should not be further delayed, as far as possible, and IT Department should again
be notified after completion of tasks so as to start EOD operations.
2.8.1. Vault Cash Management Report (VCM Report)
Branches should prepare daily VCM (Vault Cash Management) report and forward it
through email to Risk Management Department with CC to Central Operations
department, Finance Department and GSD Department on daily basis. ATM cash should
also be included along with vault cash so that it assures that the total cash of the branch
has been fully insured by the insurance policy.
2.9. Custodian of Vault Key
• Vault Key holding arrangement shall be as per the Financial By-Laws of the Bank.
• Dual control of the vault keys should be maintained and vault keys should be
segregated into two groups i.e. Key A and Key B.
• Approval for assigning key custodians should be obtained from Day 1 of the branch
opening and should be updated every time as and when the key custodians have to
be changed due to transfer, resignation or as per the requirement of the branch.

80
• Staff holding the keys of one group should not be allowed to hold the keys of
another group key at any cost. If needed, approval from concerned authority is
needed.
• The above procedures of vault key custodians are applied for evening and holiday
vaults, locker, fire proof cabinet as well.
• Branch Manager should be Main Custodian of any group of Keys (A or B),
preferably Group A Keys. Main Custodians of any group of keys have the primary
responsibility of holding vault keys. If the main custodian has to stay on leave, is
unable to attend office in time or has to go out for official visit in the early morning
or at the evening, then only the keys should be handed over to Alternate Custodian.
• All the custodians of one group of keys (A or B) should not remain on leave at the
same time. However, in case of emergency situation such as health issues, if all of
the existing key custodians of one group have to remain on leave on the same day,
the keys can be assigned to a staff not holding custodian of another group of keys,
after taking approval from COO or higher authorities in approval chain.
• Vault Key Register containing Date, Key Group (A or B), Name of Key Holding
Custodian and Signature fields should be maintained for both group of keys and
updated on daily basis. Custodianship of each type of vault can be recorded in
separate pages. Key numbers of all the keys falling under each group (A or B) and
each type of vault (day vault, evening vault, fire proof cabinet, ATM etc.) should be
mentioned at the initial pages of the register and signed by all key custodians.
• Whenever the key is handed over by one custodian to another, it should be recorded
in Vault Key Handover Register. Similar to Vault Key Register, at the initial pages
key details of each vault types should be mentioned and signed by all key custodians.
In the subsequent pages, handing over of vault keys should be recorded containing
fields such as Date, Key Type, Handed By, Signature, Taken By, Signature and
Remarks fields.
• Spare keys of Vault/Locker for inside valley branches, shall be sent to GSD for
custody. For Outside valley branches, keys shall be sent to the locker of nearest
branch for custody. If no branches of our bank are located nearby, especially if
branch is a locker facility can be availed from any other bank for safe keeping the
keys. Record of the key numbers, key group and type of vault of spare keys and
place where placed should be kept properly at the branch after taking due approval
from COO or higher authorities so that the branch will be able to locate the spare
keys in case of need.
• The spare keys of the vaults are to be replaced every 2 years so that both set of keys
wear out simultaneously and remain functional.
• Key custodians responsible for holding the assigned keys should be very careful so
as to avoid it being misplaced or misused. In case keys are misplaced or lost, the
respective key custodian will himself/herself be responsible to bear the charges to be
incurred for breaking open locker, vault and replacing the keys and related expenses.
• Branch Managers should not allow any other staffs other than designated staffs in
the Cash Department Area at any point of time.
2.9.1. Safe Keeping of Transaction Lists at branch

81
Following procedures are to be followed by branches for Safe keeping of
Transaction Lists in branches:
• After the checking of Transaction Lists by the teller staff and crossed verified by
immediate supervisor or OI/ABM/BM, TLs of all the Tellers of the same day should
be bunched together and properly kept in a safe place. Date in A.D. and B. S. should
be clearly mentioned on the viewing part of rolled TL.
• During regular intervals, TLs of 15 days to 1 month of every month, depending upon
the number of transactions taking place at the branch, should be packed in a plastic
sac and name of month and date range in A.D. and B. S. should be clearly mentioned
on the outside of the sac in a visible manner. For example, sac containing TLs for the
month of Shrawan 2079 should be named as Shrawan 2079 and (17h
July to 16th
August 2022). Similarly, if TLs of first 1st
15 days of Shrawan 2079 is being packed
in a sac, name should be mentioned as Shrawan 2079 (1st
to 15th
Shrawan 2079) and
(17th
to 31st
July 2022).
• The sac should then be placed in proper place, preferably on wooden or metal racks
on date wise manner. Access to only authorized persons should be allowed in stored
area to avoid any misuse.
• Whenever any TL of any date is to be taken out for any purpose, it should be recorded
in a register mentioning the date and time, name of staff requesting the TL, name of
staff authorizing it, purpose of retrieving the record etc. After completion of the task,
the TL should be put back in its right place without disturbing the date wise serial
number and returning of the TL should also be recorded in the same register. The sac
should also be placed in the same place so that it can be retrieved again with ease.
• A register should be maintained mentioning date, name of staff, date of TL, User
Name, initial etc. so as that the staff using the TL could be traced to ensure that it is
properly kept back in the right place.
• The TLs can also be stored in metal trunks. However, proper naming and recording
should be done as mentioned above.
2.10. Agreement with Banks & Financial Institutions (BFI) Regarding Payment of
Cheques and Acceptance of Deposit of Customers
2.10.1. Introduction
This agreement is regarding the procedure to be followed while making payment as well
as accepting deposit of customers of other Banks and Financial Institutions operating
across the country. For this purpose, a separate agreement (Specimen 40) shall be done
with the Banks and Financial Institutions willing to tie-up with our Bank regarding this
service.
The primary reasons for introduction of this scheme are as follows:
• Increase the number of transactions of the Bank.
• Increase the Non-interest income.
• Facilitate the customers of our Bank to withdraw money from their account as well as
deposit in their account from places where our Bank doesn‟t have branches.

82
•
• Increase the deposit base of the Bank as the Banks and Financial Institutions will
compulsorily open call accounts with our Bank. Standard Call Deposit Interest rates
shall be provided in these call accounts.
2.10.2. Procedure
2.10.2.1. Payment of Cheques of other Banks and Financial Institutions
• Payment amounting to maximum of NPR 100,000 per cheque shall be made. However,
this limit will not be applicable for Commercial Banks.
• Charge of NPR 150 (flat) per cheque shall be deducted as commission.
• For making payment of cheque above NPR 100,000/-, approval of COO is to be
obtained. Charge should be taken @ Rs.150/- per Rs.100,000/-.
• Commission shall be taken from either the depositor or beneficiary as advised by the
payee.
• For the purpose of payment, the cheque shall be scanned / faxed to the respective Bank
and Financial Institution requesting to be verified for signature and available balance.
For this purpose, a dedicated e-mail id of staff of the respective Bank and Financial
institution and Fax Number shall be in our Bank‟s record.
• After confirmation of verification of signature and available balance, payment shall be
made to the payee by debiting the account of the Bank and Financial institution whose
cheque has been presented.
2.10.2.2. Deposits in Accounts of other Banks and Financial Institutions
• Deposit amounting to maximum of NPR 500,000 per deposit shall be accepted.
However, this limit will not be applicable for Commercial Banks.
• Charge of NPR 150 (flat) per deposit shall be deducted as commission.
• For making payment of cheque above NPR 100,000/-, approval of COO is to be
obtained. Charge should be taken @ Rs.150/- per Rs.500,000/-. For example, for
deposit amount of Rs.500,000.00, charge of Rs.600/- will be taken.
• Commission shall be taken from either the depositor or beneficiary as advised by the
depositor.
• The amount shall be deposited in the respective account of the Banks and Financial
Institution of the customer.
• Deposit slip copy shall be scanned / faxed to the respective Banks and Financial
Institution. For this purpose, a dedicated e-mail id of staff of the respective Banks and
Financial institution and Fax Number shall be in our Bank‟s record.
2.10.2.3. Payment of our Bank’s Cheques by other Banks and Financial Institutions
• Payment amounting to maximum of NPR 100,000 per cheque shall be allowed.
• For the purpose of payment, after receipt of the scanned or faxed copy of our Bank‟s
cheque, the same shall be immediately entered in the system and the amount shall be
credited in the account of the Bank and Financial institution where the cheque has been
presented by debiting the customer‟s account.

83
2.10.2.4. Deposit in our Bank’s Account by other Banks and Financial Institutions
• Deposit amounting to Maximum of NPR 500,000 per deposit shall be accepted.
• For the purpose of deposit, after receipt of the scanned or faxed copy of deposit slip
containing the name and account number of our Bank‟s customer, account of customer
shall be credited by debiting the account of the Bank and Financial institution accepting
the deposit.
2.10.2.5. Original Cheques
• Original cheques collected against payment made will have to be sent to the respective
Bank and Financial Institution on a weekly basis.
2.10.2.6. Authorized Signatory
• Signatory authorized to sign on the cheque and deposit slip under this agreement will
be exchanged with the Banks and Financial Institutions immediately after the
agreement is signed.
2.10.3. Target
• Tying up with maximum number of Banks and Financial institutions operating within
Nepal.
• Help our Bank‟s customers‟ withdraw / deposit money from / in their accounts across
the country from maximum number of locations.
2.10.4. Fees & Commissions
A flat charge of NPR 150 shall be levied as commission to the customers using this
facility. Commission shall be taken from either the depositor or beneficiary as advised
by the customer. However, the commission shall be shared with the Bank and Financial
Institution upon request of the Bank and Financial institution, upon mutual
understanding and due approval of Chief Executive Officer.
For cheques received from customers exceeding the limits as mentioned above, the
same shall be processed upon approval of COO. However, the commission shall be
charged as per the amount. For example, cheque of NPR 200,000 shall be charged NPR
300; cheque of NPR 300,000 shall be charged NPR 450 and so on. Similarly, deposit of
NPR 600,000 shall be charged NPR 300.
2.10.5. Software
No additional software or software cost shall be required for this purpose.
2.10.6. Strategic Alliance
The bank will go for strategic alliance for this facility by tying up with various Banks and
Financial institutions situated all over the country. While choosing the Banks and Financial
Institutions, the bank shall consider its market share, qualitative factors such as
management, capacity, number of branches throughout the country etc.

84
2.10.7. Risk Management
The Product is not expected to result any additional risk to the Bank. However, following
measures shall be taken to minimize the risk:
• In case of payment of our customer‟s cheque by other Bank and Financial institution,
confirmation for payment to be sent only after debiting customer‟s account in our
system.
• In case of payment of cheque of other Bank and Financial institution‟s customer by us,
the same to be done only after obtaining confirmation for payment from the
respective Bank and Financial institution.
2.10.8. Responsibility of Treasury Front Office
• The Treasury department shall act as central hub for the all the correspondence and
maintaining good banking relationship with all the FIs.
• The department shall directly deal with FIs for obtaining new contract agreements for
the business growth.
• A Thank You note (Specimen 41) shall be sent out to the FIs after entering into the
agreement.
• The department shall circulate the updated list of the FIs to all the branches on a
monthly basis.
• The department shall keep all the records and follows up with all the FIs at least on a
fortnightly basis.
• The department shall handle all the issues regarding the FIs business.
2.10.9. Responsibility of Durbarmarg Branch
• The Durbarmarg Branch shall act as a central hub for collection of cheques (already
processed by all branches for FI transaction), and maintain all the details of the cheques
in an excel sheet for future reference.
• The Branch shall retain photocopy of the cheques for future reference and forward the
original cheques to the respective Bank and Financial Institutions on demand.
2.10.10. Accounting Entries
The accounting entries for the FIs transaction are as below:
• Accounting entry for the payment of cheques of Financial Institutions by the bank
within limit of Rs. 100,000.00
FIs call a/c Dr. Cheque amount
Teller Cash NPR Cr. Cheque amount
Teller Cash NPR Dr. Rs. 150
Commission from FIS Cr. Rs. 150
Commission and Discount Dr. Rs. 30

85
TDS Public Cr. Rs. 4.50
FIs Call A/c Cr. Rs. 25.50
• Accounting entry for the deposit in account of Financial Institutions by the bank
within limit of Rs 500,000.00
Teller Cash NPR Dr. Deposit amount
FIs call a/c Cr. Deposit amount
Teller Cash NPR Dr. Rs. 150
Commission and Discount Dr. Rs. 30
TDS Public Cr. Rs. 4.50
FIs call a/c Cr. Rs. 25.50
• Accounting entry for the payment of Bank's cheques by the Financial Institutions
Our Customer a/c Dr. Cheque amount
FIs call a/c Cr. Cheque amount
FIs call a/c Dr. Rs. 25.50
Advance Income Tax Dr. Rs. 4.50
• Accounting entry for the deposit in account of Bank by the Financial Institutions
FIs call a/c Dr. Deposit amount
Our Customer a/c Cr. Deposit amount
FIs call a/c Dr. Rs. 25.50
Advance Income Tax Dr. Rs. 4.50

86
2.11. 365 Days Banking Service
365 days banking service is established for providing better service to customers. Till now,
365 days banking service is being provided by only two branches, namely, Durbarmarg and
Kumaripati Branch. While remaining branches, offering holiday counter facility, are
providing 360 days banking service, which excludes days falling on Dashain Tika, Bhai
Tika, Nepali New Year, Holi and Bank Picnic. For providing 365 days banking service, the
staff deputed at branch offices will be mobilized. (Include latest circular notice on holiday).
2.11.1. Services Offered in 365 Banking Service
In order to facilitate the government revenue collection, clearing department at Durbarmarg
will also be opened in the following days:
• In the last day of every month if it is Saturday or public holiday.
• In all public holidays and Saturdays lying in between 25th
day till the end of the
months of Ashar, Ashwin, Poush and Chaitra.
• The following transactions will be done on 365 days banking service, including all
Public Holidays and Saturdays:
 Cash Deposit and Withdrawal.
 Account Opening, Balance Enquiry, Statement Issue and Cheque Book Issue.
 Locker Operation.
 Receipt of OBC and IBC Cheques.
 FCY Cash Purchase and Sale.
 Draft Issuance and Collection.
 Remittance Payment.
2.11.2. Staff Management
For implementing above transactions, altogether five staff (maximum) considering the
work volume will be deputed. The combination of staff will be:
• System Administrator - One
System Administrator will be on duty for Day Start, Day End and for solving IT
related problems that may arise in the due course.
• Branch Manager/Sr. Officer/Officer/Jr. Officer/Head Teller - Two
The key handling authority will be of the combination of any two of the above
designations.
• Teller/Jr. Assistant/Assistant - One
He/ She will do the entire transactions as per transaction schedule of 365 days
banking, except the work of CSD. Thus, one of the key holders will take entire
responsibility of CSD.
• Messenger - One
He/ She will work as a helping hand.

87
The number and level of staff for Holiday counter may be increased or decreased
considering the transaction volume or as per the requirement of the bank.
2.11.3. Operations of 365 banking Service
The timing of 365 days banking is from 11.00 am to 2.00 pm on all Public Holidays
including Saturdays. The reporting time of concerned employee/s will be 15 minutes
prior to opening of the bank.
A separate register will be maintained for handling of vault keys and the concerned
employee/s carrying vault keys must acknowledge its receipt. A separate attendance
register will be maintained for this purpose.
A duty sheet (for the coming month) for the above mentioned services along with the
names of staff delegated (rotation wise) will be issued and get signed/confirmed from
concerned staff.
Approval regarding required Finacle Rights of Teller, Evening Head Teller and BM
for the users should be taken before start of the month through Central Operations
Department.
2.12. Evening Counter Service
Evening banking service is the service provided to customers during the evening hours of
the working days.
2.12.1. Services Offered in Evening Banking Service
The following transactions will be done during Evening Counter, including all working
days except holidays:
• Locker Operation.
• Cash Deposit and Withdrawal.
• Receipt of OBC and IBC Cheques.
• FCY Cash Purchase and Sale.
• Remittance Payment
Cash deposit on the evening counters will be posted with next day‟s value date. The
deposited amount will be reflected on available balance of the customer on the same day
but the interest calculation in case of saving/call will be done from next day.
2.12.2. Staff Management
For implementing the above transactions, altogether two staff will be deputed. The
combination of staff will be:
Branch Manager/Sr. Officer/Officer/Jr. Officer/Supervisors/Head Teller - One

88
He/ She will be responsible to approve the transactions made. The key handling authority
will be of the combination of any two of the above designations.
• Teller/Jr. Assistant/Assistant - One
He/ She will do the entire transactions as per transaction schedule.
• Messenger - One
He/ She will work as a helping hand.
The number and level of staff for Evening counter may be increased or decreased
considering the transaction volume or as per the requirement of the bank.
2.12.3. Procedures of Evening Banking Service
The following are the procedures of the Evening Counter.
Vault Operation:
The main vault will not be used for storing cash after transactions at the day end. For this
purpose, small safe placed inside the counter will be used. This vault may also be used
for the Holiday Counter for the immediately following holiday. In the first day of
Evening Counter Head Teller will transfer certain amount needed for evening counter
operation from normal Teller Cash NPR to Cash at Vault NPR (evening). Then, all the
entries will be made from the concerned staff deputed as a teller for the evening counter.
Branch should keep cash amount in evening vault only to the limit that is necessary to run
their evening counter operation. If cash amount in Evening Vault exceeds
Rs.10,000,000.00 (Say NPR Ten Million Only), the excess cash amount should be
transferred to the day vault in the next morning without fail.
Vault Book Operation & Key Handling:
A separate Vault book register and safe key register will be maintained for Evening
Counter and the concerned staff carrying Vault Key must acknowledge its receipt. One
set of keys will be in custody of Teller and the other set of keys will be in the custody of
the Evening Head Teller/Supervisor/BM. Vault book will be operated by the Teller and
all the Vault in-out transactions will also be done by him/her since the teller is given the
authority of both Teller and Head Teller. Supervisors/ BMs will remain as an approving
authority only.
2.12.4. Accounting Entries:
Following entries will be made during the cash in-out procedure:
Entry by Teller at evening (Cash Out):

89
Dr. - Teller Cash NPR (Evening)
Cr. - Cash at Vault (Evening)
Entry by Teller at evening (Cash In):
Dr. - Cash at Vault (Evening)
Cr. - Teller Cash NPR (Evening)
Note: If there is need for extra amount for the evening counter, Head Teller may transfer
that amount from Cash at Day Vault or Teller Cash (Day Counter) to the Cash at Vault
(Evening). Same will be in case of FCY.
Entry by Head Teller (Surplus Cash Transfer)
Dr. –Head Teller Cash NPR (Normal)
Cr. - Cash at Vault NPR (Evening)
Entry by Head Teller (Need for Extra Cash)
Dr. - Cash at Vault NPR (Evening)
Cr. –Head Teller Cash NPR (Normal)
A separate register will be maintained for handling of vault keys and the concerned
employee/s carrying vault keys must acknowledge its receipt. A separate attendance
register will be maintained for this purpose.
A duty sheet (for the coming month) for the evening counter services along with the
names of staff delegated (rotation wise) will be issued and get signed/confirmed from
concerned staff. Approval regarding the Finacle Rights for the users should be taken
before starting of the prevailing month from Central Operations Department.
2.13. Schedule of Working Hours
All the branches should display the Banking Hours at the entrance door in branches.
Furthermore, it is strictly incorporated that the tellers of the branch are ready for service
at sharp 10 AM. Following is the schedule for the evening hours:
Working Hours (Office Hours)
Sunday to Thursday : 9:30 a.m. to 5:30 p.m.
Friday : 9:30 a.m. to 1:30 p.m.
Banking Hours (Transaction Hours)

90
Regular Day Counter
Friday : 10:00 a.m. to 12:30 p.m.
Evening Counter Hours
Sunday to Thursday : 03.00 p.m. to 6.30 p.m.
Friday : 12.30 p.m. to 5.00 p.m.
Kartik 16 to Magh 15
Working Hours (Office Hours)
Sunday to Thursday : 9.30 a.m. to 5.00 p.m.
Friday : 9.30 a.m. to 1.30 p.m.
Banking Hours (Transaction Hours)
Regular Day Counter
Friday : 10:00 a.m. to 12:30 p.m.
Evening Counter Hours
Sunday to Thursday : 03.00 p.m. to 5.30 p.m.
Friday : 12.30 p.m. to 4.30 p.m.
Management may change schedule of working hours from time to time
3. Remittance
Remittance is a way of sending money from one person/account/party to another
person/account/party through a Bank/Financial Institution. Having many branches
throughout the country as well as agency connections with International Financial
Institutions, a Bank caters remittance facilities to its customers by following NRB Forex.
NRB Forex is guided by NRB Foreign Exchange Unified Directive.
Remittance is normally classified as inward and outward remittance.

91
3.1. Inward Remittance
Fund received in the bank from other banks and financial institutions is termed as
Inward Remittance. Funds can be received from different modes like SWIFT message,
Fax transfers, Online Transfers, Drafts, Cheques etc.
 Branches need to obtain Source Disclosure Form (Specimen no. ......) and supporting
documents of source of fund are required for remittance amount of or above
Rs.1,000,000/- from their customers, as per AML/CFT Policy/Procedure/Circular,
before the inward remittance can be credited into the account of the customer.
 1% TDS is applicable on inward remittance received by any person, not formally
establishing a business, as payment for export of software or IT related services,
providing of consultancy service to foreign companies/individual, or uploading
video in social media sites such as Tik Tok, You Tube etc. Branches need to obtain
actual information about source of fund in source disclosure form so that TDS @ 1%
can be charged by SWIFT Unit according to Tax Policy of Nepal.
3.2. Outward Remittance
Fund transferred from the bank to the other bank and financial institutions is termed as
Outward Remittance. Outflow of fund can be done from different modes like SWIFT
message, Telegraphic transfers, Drafts, Cheques etc.
Outward remittance is usually done for making payment of import of goods and services.
Those facilities availed that do not have physical form or that do not pass through
customs office are all counted in service. Service type includes registration fees, erection
and installation of machineries, repairs and maintenance of equipment including AMC,
training provided by foreign companies, education fee payment etc. Services availed
from foreign companies inside Nepal is subject to tax deduction at source (TDS).
Parties involved in Remittance
Remitter/Applicant - Person who sends money.
Remitting Bank - Bank which receives fund from remitter/applicant and sends
fund.
Paying Bank - Bank which receives message from remitting Bank and pays
to the Receiver/Beneficiary.
Receiver/Beneficiary - Person who is intended to receive the money.
3.2.1 Procedure of Outward Remittance
For outward remittance of money, applicant has to fill up an application form
(Specimen 42) as prescribed by the Bank with under- mentioned details of:
 Remitting branch and remitting date.

92
 The details of payment instruction by means of SWIFT, Demand Draft, Fax
Transfer or Manager‟s Cheque etc.
 Currency and amount of money to be transferred (Both in figures and words).
 Applicant‟s name and address with contact number. For availing Demand Draft
and SWIFT/Telegraphic Transfer facility, the applicant must be maintaining
account with our bank. For availing other facilities, KYC form and identification
document/registration documents can be accepted.
 EXIM Code of applicant for import of goods.
 No Objection Certificate issued by M/s Ministry of Education Science and
Technology is required for education fee payment of students who want to pursue
their higher education in foreign countries. In case of India, NOC is only required
for Bachelor Degree or above.
 Beneficiary‟s Bank name, address and SWIFT code, IFSC Code, any other
official codes or Drawee Bank/Branch.
 Name, address and account number of the Beneficiary.
 Import permission letter from concerned authority.
 Purpose of payment.
 Special instructions, if any.
 NRB‟s permission letter, if applicable.
 Mode of payment to the Remitting Bank.
 After filling up the application form and signing it, the applicant submits the
application to the drawer Bank. The drawer Bank undertakes to deliver the money to
a particular person/party as instructed/requested by the applicant.
 In case of service payment, TDS paid receipt is to be obtained. TDS rate applicable
on various types of services is different, but in general, service charge of 15% is
applicable. If the company is registered at VAT, VAT paid receipt @13% should also
be obtained. NRB‟s exchange rate will be applicable for the payment of TDS/VAT.
The date wise exchange rate is available in NRB‟s website, which can be used to
verify if correct amount of TDS/VAT has been paid or not.
 In case of payment of education fees of students to foreign college/university,
education service tax of 2% will have to obtained on tuition fees and
registration/admission/enrollment fees.
 TDS of 15% is applicable for payment of language and standardized tests such as
TOEFL, IELTS, SAT etc.
 For the purpose of transferring fund, Bank maintains account and correspondent
banking relations with various Banks in the world, which are called as Nostro
accounts.
 When sending outward remittance through TT/SWIFT, branches need to choose the
correct nostro bank according to the currency of transaction and nearest route to the
beneficiary‟s bank such that corresponding bank charges will be minimum the
amount reaches to the beneficiary‟s bank the fastest.
 For issuing INR Demand Draft/TT of INR 100,000 or more, branches must take
approval from Central Operations Department/Operations In-charge/Head
Operations/COO. Similarly, for issuing FCY Demand Draft/TT of USD 5,000/- (or
equivalent other convertible FCY) or more, branches must take approval from Central
Operations Department. Further PAN card of applicant or his/her close family

93
member needs to be obtained for outward remittance of USD 5,000/- (or equivalent
other convertible currencies) and above.
 In case of education fee payment, if the PAN holder or the account holder is different
than the student, relationship certificate or a valid document showing relationship
between the student and the PAN holder/account holder should be obtained.
 In case of outward remittance for higher studies, self-declaration from applicant for
refunding the remitted amount in case of VISA rejection is to be obtained.
 Education tax of 2% on NPR equivalent amount is to be deducted for making
payment of tuition fee, enrollment/admission fee and other fees directly related to
tuition fee.
 While providing exchange facility to students, going for studying in foreign country,
for the purpose of making payment of fee against Language Test or Standardized Test,
TDS of 15% on Invoice amount is to be deducted.
3.3. Arrangements Required for Remittance
Nostro Account
Nostro Account is the account maintained by a local Bank with a foreign Bank in the
currency of that country. For e.g. our USD account maintained with Standard Chartered
Bank, New York or INR account with Standard Chartered Bank, India are our Nostro
accounts. Our account maintained in the books of these Banks are Nostro account and
corresponding account maintained in our book to reflect the activities of these Nostro
account is termed as Mirror Account.
Vostro Account
The Nostro account from the side of the holding Bank is called Vostro Account. In other
words, other Banks account maintained with us is Vostro account from our point of view.
For e.g. our USD account maintained with Standard Chartered Bank, New York or INR
account with SCB, India is Nostro account for us and Vostro account for these Banks.
While transferring fund through banking channel, the settlement of fund is always done
through Nostro and Vostro account.
Authorized Signature Booklet
Banks which enter into negotiable instruments drawing arrangement exchange their
signature booklet. This booklet contains specimen signature of Bank‟s authorized
officials and it clearly states who is authorized to sign up to what limit, what sort of
combination of signatures is required etc. Signature of drafts or pay orders presented to
paying Bank for payment is verified against the specimen signature supplied in the
Signature Booklet.
Bilateral Key Exchange (BKE)

94
Any Bank which becomes member of the SWIFT is assigned a Bank Identification Code
(BIC). But Banks cannot exchange authenticated message having financial implication
like fund transfer, until they undergo BKE. Therefore Banks interested in exchanging
financial message must first perform BKE. It is simply process of exchanging BIC Code
of two interested Banks using predefined procedure.
3.4. Modes of Remittance
• Bank Draft/Demand Draft.
• Fax/SWIFT Transfer.
• Manager‟s Cheque etc.
3.4.1. Bank Draft/Demand Draft
A Bank Draft is a written order given/drawn by one Bank to another Bank or own bank
branch to pay a certain sum of money to a specified payee, or to the order of the payee, or
on demand. A Draft is a negotiable instrument. Bank is legally liable for the payment of
demand draft to the payee or to the order of the payee. A draft cannot be made payable to
the bearer. The issuing Bank always draws the draft on the paying Bank.
As demand draft is one of the security items, it must be kept in a fire proof safe in the
Remittance Department (RD) or kept in the cash vault at the close of the day. Every
morning, prior to transaction hour, draft should be taken out from the safe/vault, after
which the draft will be in custody of the concerned staff of RD. A stock register
containing the number of draft issued per day along with draft no. should be maintained.
The remaining balance of draft is also to be written in this register and signed by the
concerned staff and Head of RD. Bank Draft is prepared in security documents/pre-
numbered forms.
3.4.1.1. Parties involved in a Demand Draft
Applicant
A person/party, who comes to the drawer Bank with a request to issue Demand Draft to
transfer money to another person/party, to be paid from the other Bank.
Payee (Beneficiary)
A beneficiary is a person/party in favour of whom Demand Drafts are issued or who will
receive the amount from the drawee Bank upon presentation of Demand draft.
Drawer Bank (Issuing Bank)
A drawer Bank is a Bank, which issues the demand drafts or in other words undertakes an
obligation to pay a certain sum of money to the payee or to the order of the payee.
Drawee Bank (Paying Bank)

95
A Bank, which pays the amount specified in the draft to the payee, or to the order of the
payee, upon presentation of the draft.
3.4.1.2. Procedure of issuing Demand Draft
• Applicant submits a prescribed remittance application at the Remittance Department
(RD) of the Bank.
• Concerned staff at RD checks the details filled by the applicant and notes down the
amount to be remitted and charges (charges as per Bank‟s standard charges) to be
charged thereon and informs the client.
• For FCY Drafts/SWIFT transfers exceeding USD 2,000 other than INR, exchange
rate must be confirmed with Treasury Department.
• If the amount exceeds 1 million, approval must be taken from the Treasury
Department.
• If the applicant is the A/c holder, he/she may provide cheque in the name of the Bank
for the amount and commission or he/she may instruct the Bank to debit his/her
account by writing account number in the application itself or in a separate letter. If
the applicant is a Non A/c Holder, he/she has to make payment in cash at the
Remittance Counter.
• RD prepares the draft and enters all the details in the draft issuance register.
• The detail of the draft is to be entered in the system in the prescribed format and then
submitted for approval. Verifier must check all the details as per filled up application
form and then approve the transaction. After approval, draft should be printed.
• Cheque Writer/Protector should be used to affix amount on the face of the draft. (For
e.g. A/cPayeeUS$2000only). If there is decimal in the amount “Not Over” should be
mentioned to round up the amount to the nearest highest decimal. For example, Not
Over Rupees 15550/- for draft amount of Rs.15,549.59 (i.e. 0.50 or higher decimal to
be rounded up to higher digit).
• The instrument is now submitted before the authorized signatories for putting their
authorized signature(s). The draft signing authority will be as per limit mentioned in
Bank‟s signature booklet.
• After signing by the authorized signatories, the demand draft is handed over to the
applicant and his/her acknowledgment of receipt is obtained in the application form.
• After the Banking hour, the concerned staff at RD prepares the Demand Draft
schedule and a copy of same is to be filed in the RD for future reference.
• For FCY other than INR, RD will send the detail to the paying bank requesting to
honor the drafts issued.
• In case of INR DD, RD has to send the HDFC DD issued report to Central Operations
Department on daily basis by 4:00 P.M. The correspondence with HDFC regarding
the Mandate update and follow up will be done by Central Operations Department.
• The draft application form must be attached with the transaction list.
• For issuing drafts, both in LCY and FCY, related circulars and guidelines of NRB
Forex as well internal guidelines must be strictly followed. Reporting (if any) should
be done as per NRB‟s prescribed format at the prescribed time and date.

96
3.4.1.3. Payment of Draft
At the time of payment of draft to the beneficiary, the drawee Bank must check the
following things very carefully.
• Date of issue.
• Name of the beneficiary.
• Amount in words and figures.
• Endorsement from the beneficiary, if it is ordered to pay to another party.
• Verification of the authorized signature with the specimen signature booklet.
• If there is practice to have Demand Draft schedule/advice, check whether the
schedule/advice for that particular Demand Draft has been already received or not.
• If everything is found in order, the paying Bank will make payment of the draft to the
beneficiary or to the order of beneficiary.
3.4.1.4. Issuance of Duplicate Draft
At the request of the applicant, in the case of loss of draft, the issuing Bank should take
following steps before issuing a duplicate draft.
• Receive a written application duly signed by the applicant stating clearly the reason
for issuance of Duplicate Draft. The draft issue date, amount, payee‟s name and the
name of the Bank on which the draft was drawn has to be mentioned in the
application.
• Get a photocopy of the applicant‟s identification document attached with the
application form.
• The counterfoil of draft form should be produced by the applicant.
• Verify the applicant‟s signature with the original draft application form retained by
the Bank. Cross the draft application form across its face, write “DD lost. Duplicate
Draft issued on…………” and sign.
• Inform the paying Bank/branch about the loss of the Original Bank Draft with a
request to stop payment, if it has not yet been paid, and obtain the confirmation from
the paying Bank about the stop payment of the same.
• Upon receipt of confirmation of non-payment of the original draft, the issuing Bank
can issue a Duplicate Draft after obtaining an indemnity bond from the applicant.
• The issuing Bank should take note of the same in the draft issue register.
• A register is also to be maintained for writing details of lost draft as well as the details
of new draft issued, in lieu of the lost draft. This register must be signed by the Head
of RD and the concerned staff of RD.
• The charges borne for Stop Payment of previous draft along with the charges for
issuance of new draft should be charged from the applicant. Charges will be as per
Bank‟s standard charges.
3.4.1.5. Cancellation of Draft
• If the applicant applies for cancellation of draft, the issuing Bank should take the
following steps very carefully:
• Receive a written application from the applicant, stating the reason for cancellation.
This facility is only to be provided to the original purchaser of the draft.

97
• The original draft, counterfoil of draft form, photocopy of identification document
should be attached with the application.
• The signature of the application along with the signature in the counterfoil form
should be verified with original draft form retained by the Bank.
• The original draft form should be crossed on its face as “Draft Cancelled
on……………”and signed by the concerned staff of RD.
• A draft cancellation register should be maintained in order to note the details of the
draft cancelled. This register must be signed by the Head of RD/OI and the concerned
staff of RD.
• Make sure that Duplicate Draft has not been issued.
• After verifications of everything, the original draft is cancelled and the amount of the
draft is paid to the applicant either in cash or credit to his/her account charging
cancellation charges as per bank‟s standard fees, commission and charges.
• In no case, the charges levied initially for issuance of draft is to be reimbursed to the
customer.
• The Paying Bank must be notified through debit advice.
3.4.2. Fax Transfer/SWIFT Transfer
Amount is transferred into the account of the beneficiary at the request of the applicant
on the same day through Fax/SWIFT Transfer (FTST). It is the fastest way to transfer
money. All the procedures for FTST are almost same as demand draft. The difference is
only that the applicant has to provide account number of the beneficiary, beneficiary‟s
bank details and SWIFT code has to be provided to the bank and amount can only be
transferred into the account of the beneficiary.
Procedures and entries for FTST are also same as noted above in the case of Bank Draft.
Fax message and TT message is prepared in normal paper, but it is tested through test
number to avoid risk of fraud.
While transferring money through FTST, the instructions of NRB circulars related to
these transfers should be strictly adhered. Any discrepancies in doing so, NRB will
impose restriction on the Bank for doing these types of transactions and other serious
action may also be taken. The reporting of FTST (if any) should be done on regular
interval and is to be sent to NRB on their prescribed format.
3.4.2.1. Fax Transfer
However, in order to meet the demand of the customer there is a practice of transfer of
money without account number through fax transfer, which may be applicable among the
branches of the Bank. If the beneficiary does not have an account, the beneficiary‟s
identification number is noted in the instruments and the paying/drawee Bank makes
payment to the beneficiary, identifying the payee through their original identity card
(Citizenship Certificate/Passport/Voter‟s ID/Driving License etc.).
All Fax Transfers shall be done through Citizens Remit domestic remittance transactions.

98
3.4.2.2. SWIFT Transfer
All inward and outward SWIFT message of the Bank will be communicated by SWIFT
Department, established at the Head office. All branches should communicate with
SWIFT Department for all Inward & Outward SWIFT messages.
Concerned department/branches will prepare the outward SWIFT as follows:
• There are various types of SWIFT messages such as MT 103, MT 202, MT 199, MT
110 etc. Different MT messages shall be used for the different purposes.
Branches/Department categorizes the message as per their requirement.
• The required entries of transaction related to SWIFT payment has to be made in the
Finacle CBS. The SWIFT message has different fields and branches shall duly
prepare the SWIFT message as per SWIFT specification.
• After preparing the SWIFT message, two concerned staff members must check the
details very carefully as any error in the SWIFT transaction involving transfer of fund
may not be reversible. Then after, the staffs need to forward the signed and stamped
hard copy as well as soft copy of the SWIFT message to SWIFT Unit of Finance
Department via email.
After receiving the SWIFT message, SWIFT Department properly verifies the same and
transmits SWIFT message. After successful transmitting of the message, SWIFT
department forwards the transmitted copy to the concerned branches. If required, the
same copy shall also be provided to the remitter/applicant.
The branches/departments have to maintain a separate register for the SWIFT Issuance
(Specimen 43) and keep the transmitted copy safely for future reference. Register
containing full details of issued SWIFT as Date, Ref. Number, Applicant Name, Dr.
Account No., Name of Beneficiary, Beneficiary's Account no., Beneficiary Bank,
Purpose of Remit and Amount.
SWIFT Department also circulates the Inward SWIFT message and advises the same to
the concerned branch. SWIFT Department shall forward IBT advice to concerned branch
for all Inward SWIFT.
In order to avoid fraud cases, the Bank transmits money through tested message, test key
of which is maintained very confidentially by the authorized employee/s only.
3.4.3. Refunding of Education Service Tax Due to VISA Rejection
After making payment of education fee payment to foreign college/university, if the
student is unable to obtain VISA to go to the concerned country to as to pursue his/her
further studies, the education service tax @ 2% that he/she had paid when making
payment of tuition and admission/enrollment/registration will be refunded by the Inland

99
Revenue Office of Nepal. The refunding of the education service tax is to be processed
from the same bank through which the TT/SWIFT amount had been paid.
Detailed procedures for refunding of the education service tax has been given in Standard
Procedure for Refunding of Education Service Tax, 2078 mentioned under NRB‟s
Unified FXM Circular no. 08/2078. According to this, education service tax submitted
after 2078/02/15 will only be eligible for the refunding.
Documents required to be submitted by the students for claiming the refunding of
education service fee payment:
 Application letter of the account holder/PAN holder in the format specified under
Anusuchi 1 of the standard procedure.
 Copy of Citizenship Certificate or Passport of the Account holder, verified with the
original.
 Account Statement of the account showing transaction of TT/SWIFT payment and
returning back of the SWIFT amount.
 Proof documents showing credit of SWIFT amount in beneficiary college/university
and /or confirmation of admission in the college.
 No Objection of Certificate (NOC) issued by Ministry of Education Science and
Technology.
 Supporting documents issued by Embassy situated inside Nepal or Immigration
Department showing rejection of VISA, withdrawal of application by the customer for
obtaining VISA or supporting documents showing returning of education fee payment.
After the bank has received application of the account holder and above-mentioned
documents, a request letter is to be prepared in the format specified in Anusuchi 2 of the
standard procedure by filling up every details. Signature Verified stamp is to be affixed
on the application form of the customer and Verified with Original Stamp is to be affixed
on the copy of all the documents.
Branches should send their request through memo to Central Operations Department for
taking approval from CEO Sir. After obtaining approval of the competent authority, the
approved memo along with other required documents shall be forwarded to Finance
Department, who will then forward the request to Inland Revenue Office for getting the
refund. After getting the refund, the amount shall be directly credited by Finance
Department into the customer‟s account.
3.5.3. Managers Cheque (MC)
A Manager‟s Cheque is a cheque issued by a Bank, drawn upon itself, promising to pay
unconditionally, the payee certain sum of money at sight. Manager‟s Cheque is also
known by the name of Cashier's Order, Cashier's cheque, Banker's cheque etc. It is a

100
negotiable instrument. A Manager‟s Cheque shall remain valid for a period of 6 months
from the date of its issue.
MCs must be kept in the vault or fireproof cabinet for security. The record of MC cheque
shall be maintained by the branches. All the issued, unissued and Void MC should be
recorded in respective register.
Use of strikethrough for cancelling/deleting and overwriting, if any, should be properly
authenticated under full signature of the Bank staff/s. Wherever signature verification is
required by this manual, verification must be done from Signature Specimen
card/Computer, unless stated otherwise, and 'SV' must be written adjacent to the signature
being verified with initial signature of the staff verifying it.
As bank assures to make payment of the MC amount to the beneficiary unconditionally,
Managers Cheque should not get returned from collection in the account of the beneficiary
as it hampers image of the bank. As such, there should be no mistake made in the issue of
MC including name of beneficiary, date, amount and alignment of print, cheque writer etc.
The print of the MC should be readable and there should be no damage in the cheque.
Reconciliation of Manager‟s Cheque Issuance account shall be done on monthly basis by
the issuing branch.
3.5.3.1. Purpose of Issuing a MC
• A Manager‟s Cheque is purchased by the customer to use as a medium of payment
locally, generally to make payment to autonomous bodies, local authorities and
government departments which do not accept ordinary cheque for payment of duties
& taxes, deposit, earnest money etc.
• Manager‟s Cheque is used by the Bank and its branches for local payment of its bills
relating to purchase of goods and services.
• No department/section other than the Finance/Remittance Department shall issue a
Manager‟s Cheque at the Head Office.
• At the branch, Manager‟s Cheque will be issued by the Remittance Department of the
concerned branch.
• Except for petty cash expenses, all payments for the purchase of goods and services
shall be made by issuing a Manager‟s Cheque or by crediting the client‟s account
with CBIL.
• Payment of duties and taxes of recurring nature can also be made by means of MC.
3.5.3.2. Procedure for Issue of MC
• Customer has to submit a written application on the prescribed format (Specimen 42)
requesting to issue Managers Cheque.
• Managers Cheque issuance commission as per Bank's standard charges shall be
recovered. The amount of commission shall be written at the allocated space on the
application form by the staff under his initials.

101
• Money, inclusive of commission, shall be recovered either in cash or by debit to
account before the issue of Managers Cheque.
• After checking the application or the documents and approval, as the case may be, the
concerned staff at the Branch/ Finance Department will prepare a Manager‟s Cheque
on the prescribed security stationery with the help of Demand Draft module in the
system.
• The Manager‟s Cheque, application form and voucher will be forwarded to the Chief
Finance Officer /Branch Manager/Operation In-charge/ABM for his/her approval.
The CFO/Branch Manager/Operation In-charge/ABM shall approve the issue of
Managers Cheque after verifying that:
 Commission, if applicable, is correctly charged.
 Cash, including commission, is received or account is debited.
 Manager‟s Cheque has been correctly prepared.
 Voucher has been correctly prepared, necessary entry has been done in the system
and issuance has been recorded in the Manager‟s Cheque Issue Register.
• Manager‟s Cheque should be signed by two authorized signatories of the Bank and
bank stamp is also to be affixed on the back side of the cheque.
• The Manager‟s Cheque shall be delivered to the applicant by taking his/her/their
signature and stamp (in case of firm/company) on the photocopy of the Manager‟s
Cheque as an acknowledgement of receipt.
• In case the Manager‟s Cheque has been issued for bank‟s own purpose such as making
payment to the vendor, the signature and stamp of the payee is to be issued on the
photocopy of the MC as an acknowledgement of receipt. If the MC has been issued on
the request of any department of Head Office, signature of the department staff as
acknowledgement of receipt can also be obtained with full signature, name of
department and designation of staffs.
 The customer copy of the application form, duly stamped and signed by the staff, will
be handed over to the applicant.
• When Manager‟s Cheque is issued for banks own purpose such as for making payment
to vendor, making disbursement of loan etc., no commission is charged for its issue.
• Cheque Writer/Protector should be affixed on the face of the MC. (For e.g.
A/cPayeeUS$2000only). If there is decimal in the amount “Not Over” should be
mentioned to round up the amount to the nearest highest decimal. For example, Not
Over Rupees 15550/- for MC amount of Rs. 15,549.59 and Not Over 15,549 for MC
amount of Rs.15,549.36 (i.e., 0.50 or higher decimal to be rounded up to nearest digit).
• Register for MC issuance as per Specimen no. ....) shall be maintained by the branch
mentioning the applicant‟s details, account number, beneficiary name .cheque number
and cheque amount.
• All Manager‟s Cheques shall be made Account Payee. However, if the beneficiary
(only individual payee) not having an account with the Bank requests in writing to
issue a bearer Manager‟s Cheque of amount below threshold limit of NRB directives,
the same could be done only after obtaining approval from BM or COO or higher
authorities.
3.5.3.3. Payment of MC
• The Manager‟s Cheque should be valid i.e. it should not be stale.

102
• Signature of authorized signatories on the Manager‟s Cheque should be verified.
• In case of account credit, the customer's account should be credited and "Account
credited' should be mentioned on the face of the Manager‟s Cheque under the
signature of the staff.
• In case of cash payment, the teller will verify the identity of the payee and forward
the Manager‟s Cheque to the Head – Teller/OI/ABM/Branch Manager for his
approval. After getting the approval, the teller will pay cash by noting denomination
on the reverse of the Manager‟s Cheque and getting the payee's signature there-under.
He/she will also put a 'Cash Paid' stamp on the face of the instrument under his/her
signature.
3.5.3.4. Stale Managers Cheque
• Manager‟s Cheque issued but remaining outstanding for payment at the expiry of its
validity period is known as Stale Manager‟s Cheque.
• A Manager‟s Cheque may be stale either because it is issued but not delivered to the
beneficiary till its expiry or it is issued and delivered to the beneficiary but is not
presented for payment within its period of validity.
• Security of Manager‟s Cheque issued but not delivered to the beneficiary is of major
concern to the Bank. Hence, the following control measures will be adopted for the
safe keeping of such Manager‟s Cheques:
• The signature of the payee will be obtained on the photocopy of the Manager‟s
Cheque or its counterfoil while delivering the Manager‟s Cheque to the payee.
• Undelivered Manager‟s Cheques will be kept in a cabinet under the dual control.
• Branch Manager will conduct surprise physical count of the undelivered
Manager‟s Cheques once every month.
3.5.3.5. Cancellation and Revalidation of MC
• A Manager‟s Cheque may be cancelled on the receipt of an application in writing from
the beneficiary/applicant mentioning the reason for cancelling the MC. The following
precautions must be taken:
• The original Manager‟s Cheque must be surrendered together with the
application.
• There must be no endorsement on the Manager‟s Cheque or endorsement
should have been cancelled with authorized signature.
• Signature of the applicant must be verified from the Manager‟s Cheque
application.
• Signature of authorized signatories must be verified.
 Cancellation charge as per bank‟s standard charges is to be obtained.
• The words 'Cancelled on ------' shall be written in bold red ink on the face of the
Manager‟s Cheque under the signature of the staff.
• The application for cancellation and cancelled Manager‟s Cheque will be attached
together with the Manager‟s Cheque application form and serially filed.

103
• Amount will be refunded to the purchaser by following the normal Banking
procedure for effecting payment.
• Demand Draft cancellation menu should be used in CBS for cancellation of MC
• A Manager‟s Cheque may be re-validated on the request of the purchaser by
following the procedure outlined below:
• Original Manager‟s Cheque should be submitted for re-validation.
• Signature of the applicant should be verified.
• Signature of Bank signatories must be verified.
• Re-validation charge will be recovered at the prescribed rate.
• "Revalidated" stamp will be affixed on the face of the Manager‟s Cheque under
the signature of two authorized signatories along with the date of revalidation.
• Revalidation should be processed through Demand Draft status maintenance in
CBS.
• Minor changes in the name on the Manager‟s Cheque, which have apparently
occurred because of error, may be amended by penning through the existing
particulars and writing the new particulars under the signature of two authorized
signatories. All amendments should be approved by the CFO/Branch Manager.
• Manager‟s Cheque should be cancelled and a fresh one issued if the applicant
requests to change the beneficiary or account number.
3.5.3.6. Loss of MC
• The branch will entertain written intimation of the loss of Manager‟s Cheque from the
purchaser. If intimation is received from the payee, it must be counter signed by the
purchaser.
• The Bank will not issue a duplicate Manager‟s Cheque in place of one reported lost or
misplaced.
• On the receipt of intimation of the loss of Manager‟s Cheque, the signature of the
applicant should be verified from the original application form.
• It should be checked whether the Manager‟s Cheque is already paid off. If it is found
to be already paid, applicant should be informed and the case should be forwarded for
investigation to the Internal Audit Department.
• If Manager‟s Cheque is issued by Head Office, it should immediately instruct the
drawee branch to stop payment. Instruction to the branch should be given over
telephone followed by fax/mail advice.
• If Manager‟s Cheque is presented for payment after the loss is reported, it should be
returned with the remarks "PO Reported Lost, Payment stopped" on the face of the
Manager‟s Cheque.
• The amount of the cancelled Manager‟s Cheque will be refunded to the purchaser
only on the expiry of the validity period of the Manager‟s Cheque.
• Proper record of cancelled / lost Manager‟s Cheque shall be kept.
3.6 Miscellaneous
• If a client not having existing business relationship or account with the Bank conducts
a transaction above NPR 1 Lakh & above or in equivalent foreign currency, then

104
branch must compulsorily obtain KYC form and identification/registration certificates
from the client.
4. Clearing
Clearing is a process of transferring of fund between accounts of two banks through
issuing of cheque of one bank and depositing of the cheque in another bank. The central
system of Electronic Cheque Clearing (ECC) has been created and being managed by
Nepal Clearing House Limited (NCHL). ECC calculates the multilateral net clearing
position and sends to the Settlement System of Nepal Rastra Bank for settlement of the
net clearing position of the direct member (FIs).
The guidelines of NRB covering ECC transactions are as given below:
 Cheque Standards and Specifications
 ECC Rule Book
 ECC Operating Rules
This section of the documents lays down the policy guidelines of clearing, its operation
and control. It is essential that procedures for outward and inward clearing be strictly
followed. All staff in the Central Clearing Department and branches doing
outward/inward clearing job must be familiar with prevailing policies of the Bank and
regulations of Nepal Rastra Bank relating to outward and inward clearing.
Outward Clearing
Outward Clearing means clearing items i.e. cheques, drafts and other negotiable
instruments tendered by the Bank‟s Customers through us on other Banks. These are
other bank‟s instruments drawn in favor of our customers.
Inward Clearing
Inward clearing means clearing items i.e. cheques, drafts and other negotiable
instruments tendered by other Banks/Financial Institutions on us for realization. These
are instruments drawn by our customers in favor of customers of other Banks/Financial
institutions.
Inward Clearing is done by Central Clearing Department. Cheque return charge has to be
recovered from customer‟s account, if the payment could not be made against cheque
presented by other banks through clearing due to insufficient balance or any other reasons.
4.1. Electronic Cheque Clearing (ECC)
Electronic Cheque Clearing (ECC) is an image-based, cost-effective, MICR (Magnetic
Ink Character Recognition) cheque processing & settlement solution where an original
paper cheque is converted into an image for electronic processing of the financial

105
transactions between participating member Banks/FIs. The physical movement of the
cheques are stopped at the level of the presenting bank in the NCHL-ECC System. The
cheque does not physically travel to the clearing house or to the paying branch as it used
to do in manual clearing process, resulting in a faster and easier processing of the cheque
transactions.
4.1.1. Outward Cheque Clearing
ECC presently has different outward clearing sessions that is settled in Nepalese Rupee,
US Dollar, EURO and Sterling Pound on each day as the following:
• Regular Session (For cheque collection within the day)
• Express Clearing Session (For faster collection of cheques)
A clearing session (ECC) will have a pre-defined presentment period, late presentment
period, reply period and cut-off time and charges for each period that specify when the
cheques are to be transmitted. The details of the presentment time and cut-off time are
guided by the ECC Operating Rules. NRB can modify the daily clearing session timings
as deemed appropriate and as per the recommendations of Nepal Clearing House Ltd.
(NCHL).
Branch has to follow the steps below in the outward clearing of the cheque deposited by
their customers:
• All cheques/clearing instruments should be received along with deposit slip, which is
to be filled by the customer.
• Details of the cheques/clearing instruments should be strictly verified with the deposit
slip.
• Customer‟s endorsement, through a rubber stamp “Please credit the amount to our
A/c no………. Signature…….” at the back of the cheque should be obtained. This
can also be done in writing by the customer.
• The details of cheques/clearing instruments received for outward clearing should be
entered in the Outward Bills Collection (OBC) Register (Specimen 46). The list of
OBC number should be serial number starting from 1 and so on. The OBC number
must be written on the center top of the cheque/clearing instruments as well as in the
deposit slip and its counterfoil. This is to be strictly done for recording purpose.
• Copy of the deposit slip must be delivered to the customer duly stamped with
“Received for Collection” mentioning the date of receipt.
• All cheques/clearing instruments must be properly stamped with “Payees
endorsement confirmed/guaranteed. Payee‟s account will be credited on realization”
and Presentment Date Stamp at the backside of the cheque. Presentment Stamp must
be endorsed on top right hand side and Payee Endorsement Confirmation endorsed at
the center of the Cheque according to the ECC manual.
• Branch manually examines all physical cheques before scanning them into the ECC.
The following are to be checked carefully:

106
• Ensure that the cheque is machine readable as only MICR cheques can be
processed through ECC.
• Ensure that the cheque date is correct and valid i.e. cheque is not stale (date has
crossed 6 months), postdated (future dated) or invalid date is mentioned.
• Ensure the cheque is signed by the drawer.
• Ensure the amount in words and figures are matching.
• Ensure that the name of payee/beneficiary exists on the cheque.
• Ensure that the cheque has not been tampered. Drawer has affixed full
signature on any correction made on the cheque.
• Ensure that the cheque is endorsed properly by the payee by mentioning
his/her/their account number. If it is a bearer cheque and cheque is being
deposited in the account, other than the payee‟s, the payee must affix his
signature on the back side of the cheque for transferring the ownership of the
cheque.
• The branch must affix stamp on the cheque with the presentment date at the
bank (right hand side) and Payee Endorsement Confirmation (center) on the
back side of the cheque.
• All cheques of any amount drawn in the name of firm/company must be A/c
Payee. Similarly, cheques drawn of amount equal to or above NPR 1,000,000/-
must also be A/c Payee and can only be deposited in the name of the payee. In
such cheques, A/c Payee must be written at the top of the cheque, either in
writing or by affixing stamp.
• After manually examining all physical cheques, designated clearing staff must scan
the cheques and perform Data Entry in ECC system portal. The following information
must be completed and entered by the clearing staff, where necessary:
• Cheque Amount
• Cheque Date
• Beneficiary Account number
• Currency Name
• Urgency (Session Type)
• After successfully capturing cheque images and transferring the electronic data on
system, Approver shall approve the cheque after properly verifying the entered data.
Verifying means to verify whether the captured cheque image is clear or not,
transferred data of the cheque is corrected or not etc. Approver must transmit/approve
the cheque according to session time as per the ECC Operating Rules.
• The cheque amount should be credited to respective customer‟s account only after
confirming that the cheque has been honored in the ECC system of NCHL and the
email of crediting of settlement amount in the Outward ECC Payable account of the
branch has been received from Central Clearing Department.
• Applicable cheque processing charge must be obtained at the time of crediting the
realized cheque amount in the customer‟s account without fail. Each and every
account must be checked to ensure the system has deducted ECC processing charge.
If same is found not done, the charge is to be recovered manually on the same day of
transaction. No negligence on the part of the branch regarding recovering of
applicable charges as per bank‟s standard fees, commission and charges is acceptable.

107
4.1.2. Outward Clearing for Express Cheque
Along with the above mentioned procedures, following additional steps are also applied
for the Express cheque clearing:
• In deposit slip, “Express Clearing Fee NPR ……” is to be mentioned by the Bank
Staff; Name, Signature and Mobile number of the customer depositing the cheque is
to be obtained.
• Express cheque shall be presented in the express clearing session time according to
the session time mentioned on ECC Operating Rules.
4.1.3. Outward Cheque Return Processing
A branch prints a Cheque Return Advice (Specimen 47) from ECC for each cheque that
has been replied with rejection by the Paying Member. The same advice should be
provided to the customer as a return advice, if required.
In case of rejection, branch should cancel the endorsement made on the back side of the
cheque for collection by marking cross sign on previous endorsement and affixing “All
Endorsement Cancelled” stamp.
In case of re-presenting the cheque, branch shall stamp another presentment stamp at the
back side of the physical cheque (top right hand side)
Following procedures should also be followed by the branch for further processing:
• Returned cheques should be scrutinized carefully to ensure that it is not due to a
technical fault on our part. If such is the case, the instrument must be re-presented at
the next clearing day, so as to get it realized at the earliest without causing
inconvenience to the customer.
• A master sheet of all returned cheques/clearing instruments should be printed from
ECC and the same should be filed for future reference. Along with that, necessary
details should also be kept in a cheque return register.
• The respective customer must be informed regarding the returned cheques. The
returned cheques should be handed over to the customer only after the receipt of
counterfoil of the deposit slip. The customer must acknowledge the receipt/copy of
cheque by signing thereon.
• The staff engaged in clearing should immediately inform the customer regarding the
cheques/clearing instruments got returned within the same or the next working day.
Follow-up calls at different times is to be made if the customer could not be contacted
in the first call. A log is to be maintained in a register or excel sheet to record the calls
made by mentioning the date and time of the call.
• If requested by the customer, the same cheques/clearing instruments may be
presented again, otherwise it should be returned to the presenter along with “Cheque
Returned Advice” printed by ECC System. “All endorsement Cancelled” stamp with
one authorized signatory is to be affixed on the back side of the physical cheque.

108
4.1.4. NCHL ECC Transaction Charges
The transaction charges being taken by Nepal Clearing House Limited (NCHL) is as per
the following table. We are only taking equivalent charges from our customers, without
taking any additional fee. Moreover, we are not taking any charges for clearing of
cheques of amount up to Rs.200,000.00, as per NRB Directives.
NCHL Transaction Fee Details:-
S. No. Details Transaction Amount Based Slab (Fees in NPR)
Up to 500 500-5K 5K-2L Above 2L
1 Regular Clearing (NPR) - 5 10 25
2 Regular Clearing (FCY) 25
3 Express Clearing 100
4 High Value Clearing 100
NCHL Other Fees/Charges:-
S.No. Other Fees Session Session
Currency
Liable
Party
Fees(NPR)
1 Bank Session Extension Fee Regular All Requesting
Member
5,000
2 Last Minute Presentment
Penalty
Regular All Presenting
Member
200
3 Express Cheque Transaction
Timeout
Express All Paying
Member
200
4 High Value Cheque
Transaction Timeout
High
Value
All Paying
Member
100
5 National Archive System
Charge
All All Requesting
Member
200
4.1.4. Maintaining Physical Cheque
Branch should affix the “Paid Stamp” on the face of all accepted outward clearing
cheques and to be stapled with the deposit slip; to be filed with the Transaction List on
day end and stored safely.
Honored cheques should be recorded in OBC register, attached with TL of respective
clearing staff along with the deposit slip similar to the method of safe keeping of cheques
presented at the counter. Similarly, returned cheque shall be recorded in Cheque return
register and filed along with the Cheque Return Slip, downloaded from ECC system, on
daily basis. Returned cheque shall be returned to the customer by taking back the original
customer copy of the deposit slip.

109
Branches shall preserve the physical cheques that are already cleared for at least Seven
years from the date of payment except for cheques under dispute. Upon an official
request (i.e. NRB, court order), branch should be able to make the physical cheque
available within six business days.
4.1.5. Inward Cheque Clearing (ECC)
Following procedures should be followed for the Inward clearing cheques after receiving
of the same:
• Every cheque/clearing instrument should be scrutinized carefully to ensure that they
are in order for further processing.
• The cheque date is correct and valid i.e. not stale or postdated.
• The amount in words and figures are matching.
• Other cheque details including cheque number are correctly entered.
• Whether any alteration made on the cheque has been signed by authorized
signatory/ies.
• Ensure that Presentment date and Payees endorsement stamp by the respective
Bank/Financial Institution are endorsed in the back side as per ECC operating
rules.
• The cheque signature matches with a/c holder‟s signature along with stamp, if
required.
• That the cheque presentment date must be same as or before the current business
date.
• The customer‟s account is not blocked or dormant.
• After verification of the above mentioned details, it should be ensured that there is
sufficient balance in the account.
• If balance is sufficient and cheque is in order, customer‟s account will be debited.
• If a cheque/clearing instrument is returned due to insufficiency of fund in customer‟s
account or for other valid reasons, the proper return reason(s) is to be chosen
available on the ECC system. It must be made abundantly clear at this stage that one
has to be extremely careful in returning items “from us”. If wrongly done, the Bank
will expose itself to punitive damages for wrongly dishonoring and breaching of trust.
• All honored and returned cheques must be cleared from the ECC system according to
the session time as per the ECC Operating Rules.
• Charges as applicable should be deducted from the customer‟s account for return of
cheque/clearing instrument.
Details of the rejected cheque must be printed for the recording and further reference
which is available on ECC system.
At the end of the day, ECC settlement takes place in the system in NRB and clearing
session accepted confirmation is received. Branches shall generate Net Clearing Position,
Details of Honored Cheque, and Details of Rejected Cheque after the closure of each
session.

110
All Inward and Outward clearing items should be reconciled properly with the ECC
system so that total in the ECC system and cheques physically at hand should reflect the
same number and value. Any inconsistencies should be immediately identified and
corrected with approval from concerned Officer/Branch Manager.
NRB Circular regarding to the Cheque Payment System should also be strictly followed.
4.2. Clean Bill Collection
Bill Collection is a process of obtaining proceeds against instruments payable at any
other bank which is normally not in the local area or in the country. If financial
instrument such as cheques, draft, manager‟s cheque etc. is presented for collection, it is
called the clean bill for collection.
• All collection instruments should be received along with deposit slip, which is to be
filled up by the customer. Copy of the deposit slip must be delivered to the customer
duly stamped with “Received for Collection”.
• A register should be maintained for record of all Bill Collection containing Collection
Date, Payees Name, Drawee Bank, Cheque No., Cheque Date, Cheque Amount, Cr.
Account No., Cr. Account Name, Staff‟s Sign, Cheque Realization Date and Staff‟s
Sign.
• OBC number should be given to all Bill Collection cheque/draft starting from CC#1
and so on as a reference number.
4.2.1. Work Flow of Cheque Collection
• Step 1: Branch receives cheques from customers. Branch fills up Cheque Collection
form by writing the details of the cheque, name of drawer, account name and account
number of the beneficiary/payee.
• Step 2: Branch sends the cheques to Remittance Department of Durbarmarg Branch
for collection. Normally inside valley branches send the cheques on next day and it
takes 3 days for cheques to be received from outside valley branches through courier.
• Step 3: Durbarmarg Branch collects the cheques from different branches and checks
the details mentioned in the collection form are correct. If there is any error,
concerned branch is informed immediately to do the needful.
• Step 4: Durbarmarg Branch sends the cheques (INR, GBP, and EURO) to Standard
Chartered Bank for collection. Likewise, USD cheques are sent to Mashreq Bank for
collection.
Procedure for SCB
CMS Deposit Slip along with the cheques is filled by RMT–4 copies and sent to SCB. A
copy of the deposit slip is given back to the bank as acknowledgement copy.
Procedure for Mashreq Bank

111
 Mail is sent by RMT to correspondents of Mashreq Bank. A cover letter along with
cheques is sent to Mashreq Bank for collection. A copy of covering letter is
acknowledged as receipt.
 Bank‟s SCB INR account is credited by SCB after the cheques are realized.
Collection Report is also received on the same day when the Nostro account is
credited.
 In case of USD, Euro and GBP cheques, realized amount is seen on Mashreq Bank‟s
and SCB Euro and GBP account with a value date. Bank does not receive any
collection report for USD, Euro and GBP but wait till the value date and if the amount
is not debited from the Bank‟s account till value date, credit advice is sent to credit
customer‟s account.
Sometimes, if the cheques are to be sent to different branches of SCB in India, then it
may take more than 10 days for the cheques to get realized.
• Reconciliation is done by reconciliation department and if collection report is received
and realized amount is not debited from our Nostro account, then IBT advice is sent to
Remittance Department for crediting the customer‟s account.
4.3.2. Procedure to be followed by Branch
• At least wait for 10 days after sending cheques to Remittance Department. If credit
advice is not received from Remittance Department till then, proceed for regular
follow-ups with Remittance Department, Reconciliation Department. Prepare a check
sheet to reconcile the pending cheques as given in the format (Specimen 48) Keep the
related customer posted about the reason for delay in the realization of cheques.
4.3.3. Procedure to be followed by Remittance Department
• Prepare a check sheet (Specimen 49) for the cheques received from branches and sent
to SCB and Mashreq Bank for collection. The sheet is to be sent to Reconciliation
Department on daily basis. The pending items are to be reconciled daily with the credit
advice sent by Reconciliation Department. If credit advice in not received from
Reconciliation Department within 10 days from the date of cheques sent for collection
then regular follow-ups is to be done with Reconciliation Department. Branch should
also be notified about the reasons for delay.

112
4.3.4. Procedure to be followed by Reconciliation Department
• Reconciliation of Foreign Nostro account is to be done on daily basis. Check the sheet
sent by Remittance Department for any cheque collection pending items. Prepare a
check sheet (Specimen 50) to check for tentative date for cheques to be credited in our
Nostro account. If the Bank‟s account is not credited on the given tentative date, then
proceed for follow-ups with the concern party (SCB or Mashreq). Also inform
Remittance Department regarding the same.
• Likewise, if the Nostro account is credited but collection report is not received from
SCB, then proceed for follow-ups regarding the same. This is to be informed to the
Remittance Department, EFO, HOO, COO and concerned branch. Credit Advice is to
be sent to Remittance Department after receiving the collection report only.
4.4. Interbank Payment System (IPS)
4.4.1 Introduction:
Inter-Bank Payment System (NCHL-IPS) is an interbank payment system of Nepal
Clearing House Limited (NCHL). Based on the National Payment System Development
Strategy Nepal Rastra Bank (NRB) has implemented the NCHL-IPS that manages
electronic payment instruments including direct debit and credit transactions. It is
established under NRB Act 2058 BS (2002) and the provision of Section 5, Sub Section 1
(i) thereof, provides one the functions, duties, and powers of NRB “To establish and
promoter the system of payment, clearing, and settlement and to regulate these activities”.
General Feature of NCHL-IPS:
Currencies: IPS supports transaction in NPR (Sunday to Friday), USD, EUR and GBP
(FCY Monday to Friday).
Threshold: Amount Threshold for Direct Credit is 200 Million for NPR (Single
Transaction), 2 Million for FCY (Single Transaction), and 10 Million for NPR (Bulk
Transaction) and 100 Thousand for FCY (Bulk Transaction). Similarly, Amount
Threshold for Direct Debit is 10 Million for NPR (Single and Bulk Transaction) and 100
Thousand for FCY (Single and Bulk Transaction).
Direct, Indirect and Technical Members: Direct Members are BFIs licensed by NRB
and operating in Nepal. They have settlement account at NRB and have direct
communication link with NCHL-IPS. Indirect Members are non BFIs having direct link
with NCHL-IPS but doesn‟t have settlement account at NRB. Technical Members are big

113
corporate houses that have large number of payments and fund transfer transaction via
NCHL-IPS.
Exchange Periods:
Exchange 0 Exchange 1 Exchange 2 Exchange 3 Exchange 4 Exchange 5
Presentment Start
Time 13:00(T-1) 10:00(T) 10:00(T) 11:00(T) 12:00(T) 13:00(T)
Presentment End
Time 10:00(T) 13:00(T) 11:00(T) 12:00(T) 13:00(T) 15:00(T)
Cancellation Period Up to10:30(T) Up to 13:30(T) Up to 11:15(T) Up to 12:15(T) Up to 13:15(T)
No
cancellation
Reply Period Up to 11:30(T) Up to 14:30(T) Up to 11:30(T) Up to 12:30(T) Up to 13:30(T) Up to 15:15(T)
Settlement Starts 12:00 15:30 12:00 13:00 14:00 15:30
There are 6 exchange periods. Exchange Sessions 0, 2 and 3 are available from Sunday to
Friday, except that foreign currency sessions are not available on Sunday. Similarly,
Exchange Sessions 1, 4 and 5 are available from Sunday to Thursday, except that foreign
currency sessions are not available on Sunday.
Exchange Period 0 starts from previous business day at 13:00. Exchange Period 1starts
from the current business day (T) at 10:00 and ends at 13:00. Exchange Period 2starts
from the current business day (T) at 10:00 and ends at 11:00. Exchange Period 3 starts
from the current business day (T) at 11:00 and ends at 12:00. Exchange Period 4starts
from the current business day (T) at 12:00 and ends at 13:00. Exchange Period 5 starts
from the current business day (T) at 13:00 and ends at 15:00. The transfer is processed
automatically in recent execution period.
Message Types: Direct Credit is payment transaction from a Debtor bank (ODFI) to
Beneficiary Bank e.g. salary transfer, dividend payments, IPO refunds etc. Direct Debit is
payment transaction to collect transaction amount from a Debtor by a Creditor bank
(ODFI) e.g. utility bills, insurance premium, loan installments etc. All Direct Debit
transaction must have mandate.
Settlement Process: Fees, charges, and penalties files will be generated from the system
at the closure of the clearing session and sent to NRB for settlement along with Net
Clearing Position (NCP).
Transaction Acceptance at End of Session: All Direct Debit Transactions are Rolled-
over once and Auto rejected while all Direct Credit Transactions are Auto Accepted.
Mandate: Mandate is an agreement or an expression of consent authorized by the debtor
allowing the beneficiary party known also as the creditor or the originator of the debit
payment transaction, to debit amount from the specified debtor‟s account at the debtor‟s
bank at predefine date fixed in the mandate. Mandate is used for direct debit transaction in

114
NCHL-IPS system and is mandatory for initiating all direct debit transactions such as
collection of utility bills, insurance premium, school fees, loan installment etc.
Standing Order: Standing Order is an instruction authorized by the debtor allowing his
bank (ODFI) to debit an amount maintained in that bank to make credit payment
transaction to credit the amount to the creditor account maintained at creditor‟s bank
(RDFI) at predefine date fixed in the standing order. Standing Order is used for direct
credit transaction to initiate regular payments such as school fees, loan installment, utility
bill payment etc.
Members: Members are the list of Banks and Financial Institutions that perform the inter-
bank payment under NCHL. Till date there are 75 members associated with NCHL-IPS
System.
4.4.2 Transaction Supported by IPS:
4.4.2.1. Outward Payments:
The outward payments are initiated by our bank as we will be sending the message/
instruction to other bank. The technical term given by IPS for the message/ instruction
sending bank is Originating Depository Financial Institution (ODFI). The outward payments
are of two types:
• Direct Credit Transactions:
The customer of CBIL fills up IPS Fund Transfer Form (specimen 62) to give
instruction to transfer the fund to other BFIs by debiting his/her/their account
maintained at our bank. The details of the beneficiary account maintained in other
BFIs must be clearly mentioned by the customer.
The account must be then debited first in our CBS and the details should be fed into
the NCHL-IPS system.
The IPS Fund Transfer Form is to be used for one time transaction and.
• Direct Debit Transactions:
The customer provides the bank duly signed NCHL-IPS Mandate or agreement form
with the Debtor entailing the details related with the fund that the customer has to
receive from the Debtors Bank.

115
The details then should be fed into the NCHL-IPS system and the paying bank must
be notified regarding the Mandate form or agreement copy.
Then, the account of the customer is to be credited after confirmation from the paying
bank. Standing Instruction can be created in our CBS to reflect such payments i.e. if
the payments are of scheduled type.
4.4.2.2. Inward Payments:
The inward payments are initiated by other banks and we will be receiving the message
to from bank. The technical term given by IPS for the message receiving bank is
Receiving Depository Financial Institution (RDFI). The inward payments are of two
types:
• Direct Credit Transactions:
The instruction from the ODFI is received to credit our customer‟s account. After
receiving the instruction, the details mentioned in the instruction must be verified
with our CBS.
After verifying the details, the instruction is to be replied within the session time. If
the instruction is replied as rejected, then no further action is to be executed.
If the instruction is accepted, then the account of the customer is to be credited after
settlement report is received from NCHL.
• Direct Debit Transactions:
The instruction from the ODFI is received to debit our customer‟s account. The duly
signed Mandate form or the agreement must also be received from ODFI or from our
customer.
The details of the instruction must be then verified and the customer account is to be
debited. If it is related with regular scheduled payments, a standing instruction
reflecting the instruction must be developed in the CBS. After the account in debited
in CBS, the instruction is to be accepted.
4.4.3 Products/Purpose under IPS:
IPS has system has the potential to support above 170 products/purposes; however, in
initial phase NCHL has launched only 13 products (purpose) under IPS. These products
are related with Direct Credit Transaction and it is available to all the members. The
details of the products are as follows:

116
S.
No. Code Purpose Name Purpose Description
1 CUST Customer Transfer General customer fund transfer
2 SUPP Supplier Party Payment
Transaction related to a payment for supplier
and party payments
3 TREA Treasury Payment Transaction related to treasury operations
4 GOVT Government Payment
Transaction related to payment from a
government organizations
5 REMI Remittance Payment
Transaction related to payment of remittance
proceeds
6 DIVI Dividend Payment Transaction related to payment of dividends
7 IPOR IPO Refund Payment
Transaction related to payment of IPO
refunds
8 SALA Salary Payment Transaction related to payment of Salaries
9 SALC
Salary Payment
Corporate
Transaction related to disbursement of
Salaries from Employer to Employee
account
10 INSU Insurance Payment
Transaction related to payment of insurance
premium and for disbursement by Insurance
companies
11 INSM Installment Payment
Transaction related to a payment of an
installment of loan repayment, others
repetitive and recurring payments
12 CCRD Credit Card Payment
Transaction related to a payment of credit
card account, bill, charges, etc.
13 FEEO Fees Payment
Transaction related to a payment of school/
college fees, service fees
1. Customer Transfer
This is a Direct Credit transaction for general fund transfer to beneficiary account as
requested by the customer. This can be used for bank‟s internal payment purpose or on
the behalf of its customer. The transaction fees liability for CUST is on ODFI bank. The
transaction limit for CUST is NPR 20 Cr and 20 Lakh in case of FCY transactions.
2. Supplier Party Payment (SUPP)
This is a Direct Credit transaction for supplier and party payments. This can be used for
bank‟s internal payment purpose or on the behalf of its corporate customer. The
transaction fees liability for CUST is on RDFI bank. The transaction limit for SUPP is
NPR 20 Cr and 20 Lakh in case of FCY transactions.

117
3. Treasury Payment (TREA)
This is a Direct Credit transaction for fund transfer related to treasury deals and funding
purposes by the members. This could be used as an alternate to SWIFT. A debtor bank
(ODFI) shall transfer fund to a beneficiary bank (RDFI). The transaction fees liability for
TREA is on ODFI bank. The transaction limit for TREA is NPR 50 Crores and 50 Lakh
in case of FCY transactions.
4. Government Payment (GOVT)
This is a Direct Credit transaction for government payments to the beneficiary accounts
as requested by the DTCO/ FCGO customer. This can be used for the payments by
government departments/ institutions through FCGO/ DTCO like party payments, inter
division transfers, etc. The transaction fees liability for GOVT is on RDFI bank. The
transaction limit for GOVT is NPR 20 Cr.
5. Remittance Payment (REMI)
This is a Direct Credit transaction for payment of remittance proceeds directly to the
beneficiary account at any of the banks. The debtor bank (ODFI), on request of
Remittance Company, shall initiate the remittance transaction to the creditor bank (RDFI)
for crediting beneficiary. The transaction fees liability for REMI is on ODFI bank. The
transaction limit for REMI is NPR 1 Cr.
6. Dividend Payment (DIVI)
This is a Direct Credit transaction for disbursement of Dividend by the company or
merchant bank directly to the shareholder‟s account at any of the banks. The debtor bank
(ODFI) on request of the company or merchant bank shall send the dividend payment
instruction in favor of the shareholders at the creditor banks (RDFI). The transaction fees
liability for DIVI is on RDFI bank. The transaction limit for DIVI is NPR 1 Cr.
7. IPO Refund (IPOR)
This is a Direct Credit transaction for disbursement of IPO/ FPO/ Auction refunds by the
company or merchant bank directly to the shareholder‟s account at any of the banks. The
debtor bank (ODFI) on request of the company or merchant bank shall send the payment
instruction in favor of the shareholders in creditor banks (RDFI). The transaction fees
liability for IPOR is on RDFI bank. The transaction limit for IPOR is NPR 1 Cr.
8. Salary Payment (SALA)
This is a Direct Credit transaction for disbursement of Salary from employer directly to
the employee‟s account at any of the banks. The debtor bank (ODFI) on request of the
Employer shall send salary payment instruction in favor of the employees in creditor

118
banks (RDFI). The transaction fees liability for SALA is on RDFI bank. The transaction
limit for SALA is NPR 1 Cr and 1 Lakh in case of FCY transactions.
9. Salary Payment Corporate (SALC)
This is a Direct Credit transaction for disbursement of Salary from employer directly to
the employee‟s account at any of the banks. The debtor bank (ODFI) on request of the
Employer shall send salary payment instruction in favor of the employees in creditor
banks (RDFI). The transaction fees liability for SALC is on ODFI bank. The transaction
limit for SALC is NPR 1 Cr and 1 Lakh in case of FCY transactions.
10. Insurance Payment (INSU)
The payment instruction is for insurance installment repayments by customer and for
collection by the bank/ institution.
10.1 Direct Credit transaction in INSU is the payment of insurance premium by the
policy holder/ customer directly to the insurance company. The debtor/ customer‟s bank
(ODFI) shall send a payment instruction for insurance premium to the insurance
company‟s bank (RDFI). The transaction limit for INSU direct credit is NPR 20 Cr.
10.2 Direct Debit transaction in INSU is the collection of insurance premium dues by
the insurance company from the bank account of the policy holder (debtor customer) on
the due dates based on one-time authorization (called as Mandate) provided by the
customer in favor of the insurance company. The transaction limit for INSU direct debit
is NPR 1 Cr.
11. Installment Payment (INSM)
The payment instruction is for installment repayments by customer and for collection by
the bank/ institution.
Direct Credit transaction in INSM is the payment of installment by the customer
directly to the bank/ institution. The Debtor/ customer‟s bank (ODFI) shall send a
payment instruction for installment payment to the receiving bank (RDFI). The
transaction limit for INSM direct credit is NPR 20 Cr and 20 Lakh in case of FCY
transactions.
Direct Debit transaction in INSM is for collection of installment dues by the bank/
institution from the bank account of the debtor (customer/ loanee) on the due dates based
on one time authorization (called as Mandate) provided by the customer in favor of the
issuing bank. The transaction limit for INSM direct debit is NPR 1 Cr and 1 Lakh in case
of FCY transactions.
12. Credit Card Payment (CCRD)
The payment instruction is for payment/collection of dues of credit card.

119
Direct Credit transaction in CCRD is the payment of credit card dues by the customer
directly to the card issuing bank. The Debtor/ Customer‟s bank (ODFI) will send a
payment instruction for credit card payment to the card issuing bank (RDFI). The
transaction limit for CCRD direct credit is NPR 1 Cr and 1 Lakh in case of FCY
transactions.
Direct Debit transaction in CCRD is for collection of credit card dues by the issuing
bank directly from the bank account of the debtor (card holder) on the due date based on
one time authorization (called as Mandate) provided by the card holder in favor of the
issuing bank. The transaction limit for CCRD direct debit is NPR 1 Cr and 1 Lakh in case
of FCY transactions.
13. Fees Payment (FEEO)
This is a Direct Credit transaction for fees payment to beneficiary account as requested
by the customer. This can be used for the payment of school/ college fees, service fee,
and similar on the behalf of the customers. The transaction fees liability for FEEO is on
ODFI bank. The transaction limit for FEEO is NPR 1 Cr and 1 Lakh in case of FCY
transactions.
4.4.4 Commission and Fees:
Charges being taken by NCHL in IPS transactions based on the amount of transaction are
given below. Our bank takes no additional charge above this from customers.
NCHL Transaction Fees Details
S. No. Price Scheme Transaction Amount Based Slab
Up to 500 >500-5,000 >5K-50K >50K
1 NPR Transactions (Fee
in NPR)
2 5 10 15
2 FCY Transactions (Fee
in NPR)
15
* For Dividend and IPO Refund payments, the transaction fee has been waived for
transaction amount up to NRs 100.
Transaction Fees
S.
No. Product/ Purpose
Code
Txn.
Type
Who Pays
Txn
Type
Who Pays
1 Customer Transfer CUST
Direct
Credit
Debtor
(ODFI)
2 Treasury Payment TREA
Direct
Credit
Debtor
(ODFI)
3
Government
Payment
GOVT
Direct
Credit
Creditor
(RDFI)

120
4 Remittance Payment REMI
Direct
Credit
Debtor
(ODFI)
5 Dividend Payment DIVI
Direct
Credit
Creditor
(RDFI)
6
IPO Refund
Payment
IPOR
Direct
Credit
Creditor
(RDFI)
7 Salary Payment SALA
Direct
Credit
Creditor
(RDFI)
8 Insurance Payment INSU
Direct
Credit
Debtor
(ODFI)
Direct
Debit
Creditor
(ODFI)
9 Installment Payment INSM
Direct
Credit
Debtor
(ODFI)
Direct
Debit
Creditor
(ODFI)
10 Credit Card Payment CCRD
Direct
Credit
Debtor
(ODFI)
Direct
Debit
Debtor
(RDFI)
11
Salary Payment
Corporate
SALC
Direct
Credit
Debtor
(ODFI)
12 Fees Payment FEEO
Direct
Credit
Debtor
(ODFI)
Direct
Debit
Debtor
(RDFI)
13
Supplier Party
Payment
SUPP
Direct
Credit
Creditor
(RDFI)
Other Charges
S. No. Other Charge Charge Who Pays
1 Return Fee 0/ 100 Transaction Originator (ODFI) based on
2 Cancellation Fee 100 Transaction Originator (ODFI)
3 Rollover Fee Txn Fee Transaction Receiver (RDFI)
4 Auto Rejection 2 x Txn Fee Transaction Receiver (RDFI)
5 Unwind Fee 100 Requesting member
6
Session
Extension
5,000/ 30Mins Requesting member
Other Fees
S. No. Other Fee Charge(NRs) Who Pays
1 Standing Instruction (SI) Free -
2 Mandate Free -
3 Archive Fee 200 / Txn Requesting member
4 Creditor Listing Fee 10,000 / year
Requesting member (Per creditor
listing)
4.4.5 Working Procedure/ Module:
IPS process is done through NCHL-IPS system as per the guidelines of Nepal Rastra
Bank as follows:
• NCHL-IPS Participant System User Manual

121
• NCHL-IPS Operating Rules Version 1.0
As the NCHL-IPS is similar to the existing ECC system and is likely to replace the ECC
system, all the process shall be handled like the existing ECC system. All the Inward
Payments is to be handled centrally by the Clearing Department at Durbarmarg Branch
which will be connected through middleware- ConnectIPS and the Outward Payments is
to be made available to all the branches. The existing user of the ECC system at all the
branches will be handing the IPS system and the user creation is to be done accordingly.
The IPS system has additional feature that is to be handled by Treasury Department so,
addition user will be provided to Treasury Department. The existing network/platform of
NCHL-ECC system is sufficient to support IPS system.
4.4.5.1 Procedure for Outward Payment
Branch has to follow the steps below in the outward payment:
• The existing form of “Application for Fund Transfer” (Specimen 54) is to be used,
which is to be filled by the customer.
• Copy of the form must be delivered to the customer duly stamped with “Transfer”.
• Branch manually examines all form before entering in the system of IPS. The
following are to be checked carefully:
• Ensure that the transfer date is correct and valid.
• Ensure the form is signed by the drawer.
• Ensure the amount in words and figures are matching.
• Ensure that the beneficiary name exists and account number is mentioned
clearly in the form.
• Ensure the name of bank and branch is correctly mentioned in the form.
• After manually examining all forms, designated clearing staff must perform Data
Entry of the information. The following information must be completed and entered
by the clearing staff, where necessary:
End to End ID
 Transfer Amount
 Sender Account Number and Name
 Beneficiary Bank and Branch
 Beneficiary Account number and Name
 Currency
 Purpose
After successfully entering data on system, Approver shall approve the transfer after
properly verifying the entered data. Verifying means to verify whether the transferred
data of the fund transfer is corrected or not etc. Approver must transmit/approve the
transfer according to session time as per the IPS Operating Rules.
Existing reports/ queries with respective category purpose can be used by the bank for
necessary reporting and reconciliations.

122
While transferring the amount, the entry should be simultaneously made on Core
Banking System (CBS) as well. The following entry should be made in (CBS).
Direct Credit Transaction
Customer account Dr. (Amount to be transferred + Charge)
IPS O/W a/c Cr. (Amount to be transferred)
IPS Commission Cr. (Income of Bank if any)
IPS Payable Cr. (Charge payable to IPS on yearly basis)
Outward payment will be settled by sending IBT advice to branches.
Outward Payment Return Processing
A branch prints a Return Advice from IPS for each transaction that has been replied with
rejection. The same advice should be provided to the customer as a return advice, if
required.
Following procedures should also be followed by the branch for further processing:
• Returned transfer should be scrutinized carefully to ensure that it is not due to a
technical fault on our part. If such is the case, the instrument must be re-presented at the
next exchange session, so as not to cause inconvenience to the customer.
• A master sheet of all returned transfer should be printed from IPS and the same
should be filed for further reference.
• The staff engaged in clearing should immediately inform the customer regarding the
return
• Once the transfer is returned, the customer has to sign new form of IPS fund transfer
for re-processing. However, the commission amount and IPS payable amount shall not be
returned.
Reversal entry to be made in case of return:
Customer account Dr. (Amount transferred)
IPS O/W a/c Cr. (Amount transferred)

123
4.4.5.2 Procedure for Inward Payment
The middleware integration component will be capable of validating the inward
transaction from NCHL-IPS vis-à-vis details available at CBS and later for converting
ISO20022 message format from NCHL-IPS to the standard ISO8583 message format for
entry into the CBS. This is the inward integration component that will consume the
inward transactions from NCHL-IPS and then does the basic account level validations
with the CBS (like credit account number, account name, account status, etc.). And if the
validation is passed, then the integration will normally not send any response
immediately to NCHL-IPS, whereas creditor account is credited after the settlement, for
direct credit transactions. However, for the specific defined purpose code (like ECPG
from connectIPS Core Module), the inward integration component will also credit the
beneficiary account and send accepted response.
The process flow of Inward Integration is depicted as follows:
1. Inward integration component will consume the inward transaction messages from
NCHL-IPS.
1.1 The system will then validate the account details (account number, account name,
status) of the creditor account from the CBS. For the specific defined purpose code
(like ECPG from connectIPS Core Module), the inward integration component will
also credit the beneficiary's account if the validation is passed.
2. If the validation fails due to the account number or account status then the rejection
message (status as „RJCT‟) will be sent immediately to the NCHL-IPS. For the
specified purpose code with validation passed, accepted message response (status as
ACSP) will be sent. If the account number is correct, however the account name
differs, then such transactions will be sent to a manual queue within the Inward
Integration Component for manually intervention. The user will manually Reject or
accept such transaction.
3. Once the settlement is over, the Inward Integration component will pick the
Transaction Report from NCHL-IPS and then identify the transactions that are
Accepted or Rejected.
4. Corresponding to the accepted transactions, the system will generate credit transaction
to the CBS, for direct credit transaction.
After generation of credit transaction from CBS, the following entry should be made in
(CBS).

124
Customer account Cr.
IPS I/W a/c Dr.
Inward payment will be settled centrally by Clearing Department, Durbarmarg Branch.
All the office account (IPS I/W and IPS O/W) is to be made NIL before EOD.
At the end of the day, IPS settlement takes place in the system in NRB and clearing
session accepted confirmation is received. Branches shall generate Net Clearing Position,
Details of successful payment, and Details of rejected payment after the closure of each
session.
All Inward and Outward payment system should be reconciled properly with the IPS.
Any inconsistencies should be immediately identified and corrected with approval from
concerned Officer/Branch Manager.
Hence, this manual shall be revised in future in line with changes and future modules
offered by NCHL.
4.5 connectIPS
connectIPS is also a product of NCHL that provides an online single payment platform to
customers to transfer fund from one bank account to another and make bill payments.
It supports citizen-to-government (C2G), customer-to-business (C2B) and peer-to-peer
(P2P) payment transactions directly from/to the bank accounts. It is available on both
web channel and mobile app.
Unlike IPS, the customer does not need to visit the branch, but can initiate payment
through online from home/office or anywhere. Another difference to IPS is that while IPS
transaction takes effect only at the time of settlement, transaction initiated through
connectIPS takes effect in the real time.
The NCHL has facilitated customers to link their bank account directly their website. In
case, the customer cannot link his/her account, he/she can download the form, sign on the
customer‟s signature field and at the bottom of each terms and conditions page and can
request the branch either visiting personally or sending request through email. If such
request is obtained, branch need to verify the signature in the form with the specimen
signature of the account and proceed to link the account. If the request has been sent
through email, it should be ensured it has been sent through email ID registered at the
bank.

125
4.6 Real Time Gross Settlement (RTGS)
Real-time gross settlement (RTGS) is a continuous process of settling payments on an
individual order basis without netting debits with credits across the books of a central
bank (e.g., bundling transactions).
RTGS provides immediate realization of funds and minimizes the settlement risk of the
other payment systems. In other words, unlike ECC and IPS, the transaction takes effect
on real time basis, without having to wait for settlement process. Once completed, real-
time gross settlement payments are final and irrevocable. Hence, the branches should be
very cautious while processing RTGS by rechecking the details, especially beneficiary‟s
account number, account name and amount.
The RTGS system is regarded by NRB as a systemically important payment system in
Nepal. The central RTGS system is implemented and hosted by Nepal Rastra Bank. NRB
is also the technical operator and a Participant using the RTGS system to fulfil its own
payment obligations.
The Real Time Gross Settlement (“RTGS”) System Rules are applicable to the
participant using the RTGS system provided by Nepal Rastra Bank. The RTGS System
Rules are governed by the Laws of Nepal.
4.6.1 Procedures for RTGS:
All inward and outward RTGS transactions are currently centralized and are operated by
Central Clearing Department of Durbarmarg Branch. Once application for RTGS
transaction is received from their customers, branches have to make necessary
transactions and forward the request to Central Clearing Department to carry forward the
customer‟s request. General procedures to be followed for carrying out RTGS
transactions are given below:
• Branches receives filled up application form (specimen 63) from customers for RTGS
transactions (minimum amount: Rs.0.20 Million) with instruction to transfer fund
from their account or against cash deposit to account maintained in another bank.
• Branch shall ensure all details of forms are dully filled up.
• Branches shall verify the signature of the applicant and affix Signature Verified stamp
on the form.
• Branch shall forward the scanned copy of the form to Central Clearing Department
through email.
• If the customer presents cheque, the concerned account is to be debited and the
amount is to be transferred to Outward RTGS account maintained at Durbarmarg

126
Branch. In such case, the branch is to also mention the amount transferred into this
account along with the attachment of the form, in their email.
• Central Clearing department shall process the necessary entry in RTGS system and
provide report to the branches after completion of the task.
General Feature of RTGS:
Currencies: RTGS supports transaction in NPR (Sunday to Friday), USD, EUR, GBP
and JPY (FCY Monday to Friday).
Parameters and Limit:
Currency Threshold for Mandatory
RTGS Transaction
Minimum Limit for RTGS
Transaction
Nepalese Rupees (NPR) NPR 2 Million or above NPR
200,000 or above
NPR 200,000 or above
US Dollar (USD) USD 20 Thousand or above USD 2 Thousand or above
Euro (EUR) EUR EUR 20 Thousand or above EUR 2 Thousand or above
Pound Sterling (GBP) GBP 20 Thousand or above GBP 2 Thousand or above
Japanese Yen (JPY) JPY 2 Million or above JPY 200,000 or above
Maximum number of days in advance of value date that a
transaction can be submitted
10 Days
Timing Schedule and Periods:
Normal Business Day
Period Name Start Time End Time
Normal Business Day
(Sunday – Thursday)
Morning Exchange period for Customer and Interbank payments 10:30AM 1:30 PM
Afternoon Exchange period for Customer and Interbank
payments 01:30PM 02:30PM
Evening Exchange period for Interbank payments 02:30PM 03:00PM
(Kartik 16 to Magh 15)
(Sunday – Thursday)
Morning Exchange period for Customer and Interbank payments 10:30AM 1:00 PM
Afternoon Exchange period for Customer and Interbank
payments 01:00PM 02:00PM
Evening Exchange period for Interbank payments 02:00PM 02:30PM
(Friday)
Morning Exchange period for Customer and Interbank payments 10:30AM 12:00AM

127
Afternoon Exchange period for Interbank payments 12:00PM 12:30PM
Transaction Charges:
Time Schedule during Normal Business Day Fee (NPR)
For transaction settled in Morning Exchange 10
For transaction settled in Afternoon Exchange 20
For transaction settled in Evening Exchange 100
Special Membership for Clearing House/DNS
Mechanism/Central Securities Depository/Organization
appointed by NRB 0
4.7 CorporatePAY
CorporatePAY is an online platform allowing the corporate and business customers of
its member banks & financial institutions (BFIs) for initiating digital payments from any
of the accounts maintained at member banks. This system allows the corporate
customers to process real time payments through connectIPS e-Payment system and
non-real time bulk payments through NCHL-IPS system, with all the necessary multi-
user controls required for such business transactions.
Basically, it is an online fund transfer product that enables a corporate customers to use
both connectIPS and NCHL IPS products through a single platform without need to visit
the branch.
Security:
1. Maker/Checker control along with 2FA using Google Authentication for Main login.
2. Password based login for different Bank account logins.
3. Option to choose secured connection through VPN or usage via Public Network
Service Mode Availability
1. Connect IPS
2. NCHL IPS
3. RTGS (in process)
Features & Benefits
1. Real time Interbank and Intra-Bank Fund Transfer
2. Non real time fund transfer
3. Salary payment on individual basis or batch posting
4. Vendor Payment through different payment systems
5. Government Tax and Revenue Payment
6. SSF, EPF, CIT Payments
7. Service Payments

128
8. Other Payments such as Mobile Top ups
9. Account Balance Information.
10. Transaction reports and queries.
Required Documents for Application:
1) Company Registration Certificate
2) PAN or VAT
3) Company Resolution for availing corporatePAY service, transaction limit,
authorized users and mandate for operation
4) KYC and Identity documents of users if they are different persons other than
authorized signatories of the account
5) Memorandum of Association and Articles of Association
6) Latest Share Holding Pattern Registered in Company Registrar Office
7) The application for enrolling to NPI can be obtained from Central Clearing
Department.
When a request to enroll to CorporatePAY service is received by the branch, branches
need to ensure that all the required documents mentioned in the application form has
been submitted by the customer. The customer has to define the role of authorized
signatory/ies for each service type and volume of transactions in the company minute.
Then, the request along with submitted documents are to be forwarded to Central
Operations Department.
After ensuring all the required documents of the corporate have been submitted by the
branch, the concerned staff of Central Operations Department will proceed to enroll the
Corporate customer to CorporatePAY service, which includes series of steps such as
enrolling corporate customer, creating/adding corporate users, linking bank accounts,
assigning signatories and confirmation.
After Completion of verification of corporate creation, the entire login details and
activation link of Corporate Users are sent to their authorized mail and mobile number.
Authorize Corporate Users need to activate their user by going on the given link
received in their mail address and have to change their login credentials for the first time.
4.8 National Payment Interface (NPI)
National Payments Interface (NPI) is another product of NCHL that is suitable for
Corporate customers for making bulk payments. It is a consolidated Application
Programming Interfaces (APIs) of multiple payment systems hosted by NCHL built on an
Open API platform concept. It currently provides access to NCHL-IPS system and
connectIPS e-payment as underlying payment systems with the overlaying services built
on top of the platform. It primarily supports push transactions with seamless integration
to connectIPS for real-time instant payments and to NCHL-IPS for deferred credit
payments.
NPI is being used as the central domestic rail for payment transactions and can be used
by the alternate channels and/or overlaying services provided by the banks & financial

129
institutions (BFIs) or other service providers. The intended purpose is to consolidate
multiple national payment systems into open API platform such that the payment
infrastructures could be used by any of the service providers.
It has been subscribed by the participating BFIs for enabling their alternate channels
including their mobile banking, internet banking, corporate channels and remittance
systems. Other non-bank institutions like payment service providers (PSPs), payment
system operators (PSOs), remittance companies, insurance companies, Government and
Semi-Government institutions are also some of indirect/ technical members of NPI. The
BFIs are on-boarded as direct members and others as Indirect/Technical Members with
direct members as its settlement banks. The transaction limits and all other operating
procedures are as per that of the underlying core systems.
Required Documents for Application:
1) Company Registration Certificate
2) PAN or VAT
3) Latest Tax Clearance Certificate
4) Company Resolution for availing NPI service.
5) KYC and Identity documents of users if they are different persons other than
authorized signatories of the account
6) Memorandum of Association and Articles of Association
7) Latest Share Holding Pattern Registered in Company Registrar Office
The Application Form for enrolling to NPI can be obtained from Central Clearing
Department. After obtaining completely filled up application form along with required
documents from the customer, the branch can forward the request to Central Clearing
Department, which will then forward the request to NCHL to complete the enrollment
process.

130
5. Summary of Approving Authority
Summary of Approving Authority
S. No. Task Approving Authority Source
1 Account Opening BM
2
High Risk Graded Account
Opening and modifying of
medium/low graded account
to High Risk COO
As per AML CFT Policy, Chapter 4
Point No. 1.1
3
Cheque book Issuance (in
absence of requisition slip,
replacement of lost cheques) BM Operations Manual Point No. 1.3.1
4 Loose Cheque BM Operations Manual Point No. 1.3.7
5 Dormant Activation BM/ ABM Operations Manual Point No. 1.3.8
6
Standing Instruction
monitoring BM Operations Manual Point No. 1.3.9
7 Payment of Deceased Account
COO (with recommendation of
Legal Department)
Operations Manual Point No.
1.3.11
8 Closing Account
BM with no objection (from TCA,
Finance, Credit, Locker, Card) Operations Manual Point No. 1.4
9
Interest on Foreign Currency
Fixed Deposit
ACEO - Operations / COO /
Treasury Operations Manual Point No. 1.5.3
10
Waiver in Fees & Commission
/ Transaction Reversal &
Deletion COO or Higher Authority
As per Country Circular No: 85 & 2
& Operations Manual Point No. 1.8
11
Interest on Matured F.D. for
overdue period Operations Manual Point No. 1.5.8
Up to 7 days BM
After 7 days up to 30 days ACEO - Operations / COO
12 Loan against CTZN FDR
Country Circular No. 155/2010
Dated 22.12.2010 & Operations
Manual Point No. 1.5.10
Without deviations, up to NPR
1 Crores (FD opened in same
branch) BM
Above NPR 1 Crores CEO
13
Loss of Locker Key (Break
Open Locker) COO or Higher Authority Operations Manual Point No. 1.6.5
14
Break-Open Locker due to
non-realization of Bank dues COO or Higher Authority Operations Manual Point No. 1.6.7
15
Locker Closure after death of
Locker holder COO or Higher Authority Operations Manual Point No. 1.6.9

131
16 Cash in Transit
COO / Operations In-charge/Head
Operations Operations Manual Point No. 2.1.4
17
Cash short exceeding NPR
1,000 ACEO Operations / COO Operations Manual Point No. 2.1.7
18 Cash Excess transfer to Income ACEO Operations/ COO Operations Manual Point No. 2.1.7
19
Reverse Income booked for
cash excess ACEO Operations/COO Operations Manual Point No. 2.1.7
20 Bait Money/ Bills
Head Operations/ Operations In-
Charge/ COO or Higher Authority Operations Manual Point No. 2.1.8
21 Cash sales above USD 500 BM Operations Manual Point No. 2.5
22 Return of unpaid cheques BM through Department Head Operations Manual Point No. 2.6
23
Reversal of Unidentified
Deposit Account BM Operations Manual Point No. 2.7
24 Custodians of Vault Keys CEO Operations Manual Point No. 2.9
25
Spare Keys to be kept in other
bank Locker COO or Higher Authority Operations Manual Point No. 2.9
26
Above limits transactions in FI
Transactions
2.10.2.1 and 2.10.2.2
Deposits above NPR 500,000
of BFIs from single cheque COO
2.10.2.2
Withdrawal above NPR
100,000 of BFIs from single
cheque COO
2.10.2.1
27
Finacle Rights for operations
of evening / holiday counter
Charge/Central Operations/COO
2.11.3
28
Same day value date for
evening deposits
2.12.1
29
Issuing bearer Manager's
Cheque ACEO Operations/ COO / BM
3.4.3.2
30
Amendments in Manager's
Cheque CFO / BM
3.4.3.5
31
Issuing DD/TT of or above INR
50,000/- and USD 5,000/- (or
equivalent FCY)
or Higher Authority Operations Manual Point No. 3.2
32 Blacklisting of A/c Holder Dy. CEO/CEO Operations Manual Point No. 1.7

1663789117187Operations Manual 2022 Draft.pdf

More Related Content

Similar to 1663789117187Operations Manual 2022 Draft.pdf

Recently uploaded

1663789117187Operations Manual 2022 Draft.pdf