Analysis of Overall Activities of The Collection in Centre of Standard Chartered Bank

Internship Report
On
Analysis of Overall Activities
Of
The Collection Centre of Standard Chartered Bank
Prepared For:
Professor Dr.
Dean, School of Business
Asian University of Bangladesh
Supervisor
Farzana Islam
Assistant Professor
Department of Finance
School of Business
.
Signature of Supervisor
Prepared By
A.S.M. Ahsanul Haque
MBA 19th
Major in HRM
ID No. 0000000000000
Dhaka, 05 June 2009
www.AssignmentPoint.com
At the very beginning, I would like to express my deepest gratitude to the Almighty Allah for
giving me the ability and strength to finish the internship report successfully within the
scheduled time.
I would like to express my hearties gratitude, deepest sense of aspiration and indebtedness to
my faculty supervisor, Mrs. Farzana Islam, Assistant Professor, Department of HRM, School
of Business, Asian University of Bangladesh, for her constant and valuable guidance, active
encouragement, co-operation, valuable criticism and encouragement and advice throughout
the preparation of this report.
My heartfelt gratitude goes to Mr. Javed Iqbal Chowdhury, Head of Collection, Standard
Chartered Bank. I am indebted to him for his willful and heartiest co-operation, inspiration
and suggestions to complete the internship in the SCB Collection Centre. My endless thanks
go to Mr. Zia Hasan Chowdhury, Senior Manager-SME and Secured Loans, Mr. Mohammad
Monirul Hasan, Manager Collections-Credit Card and Personal Loan, Mr. Iftekhar Salim,
Officer-Credit Card and Personal Loan, Mr. Amit Premtilok Roy Choudhury, Officer-Legal
and Recovery, Mrs. Taslima Subhani, Team Leader-Personal Loan and Mr. A K M Shahnur,
Team Leader-SME and Secured Loans, who enriched my knowledge on the collection and
recovery activities and procedures.
Finally, I would like to record a deep sense of aspirations to all the Managers, Officers, Team
Leaders and Customer Service Assistances at the Collection Centre for supporting me and
providing me pleasurable working experiences. I apologize to those whom I have not
mentioned in the acknowledgement However, I remain grateful to them.
SCB Standard Chartered Bank
DPD Day Passed Due
CAO Customer Assistance Officers
CSA Customer Service Advisor
IPI Integrity Priority Index
PTP Promise to Pay
PDC Post Dated Cheque
BP Banking Products
CP Consumer Products
PL Personal Loan
FL Flexi Loan
BIL Business Installment Loan
AL Auto Loan
MIS Management Information System
HR Human Resource
KPI Key Performance Indicators
CC Credit Card
FID First Installment Due
IS Information System
SAFE Security Awareness For Employees
IST Information Security Team
HIS Head of Information Security
GIS Group Information security
DBMS Data Base management System
DRP Debt Relief Program
CWX Collection Work Exchequer
UDC Undated Cheque
05 June 2009
Professor Dr.
Dean, School of Business
Dhaka
Subject: Submission of internship report on Analysis of Overall Activities of the Collection
Centre of Standard Chartered Bank
Dear Madam,
I am pleased to be able to submit this internship report on the topic Analysis of Overall
Activities of the Collection Centre Of Standard Chartered Bank for partial fulfillment of the
requirements of the MBA degree.
The 3 months internship program in the Collection Centre of Standard Chartered Bank was a
wonderful opportunity for me to acquaint closer with the organization. This paper attempts to
discover my observations, learning and experiences gained on the collection and recovery
activities as well collection policy and strategies of the Collection Centre. Writing this project
paper plan has been an extremely challenging and interesting experience for me.
I have tried my best to prepare and represent an overall view of the SCB Collection Centre in
consistence with the optimal standard under your valuable direction. I shall be very glad to
furnish any explanations on this report if necessary.
Sincerely yours,
A.S.M. Ahsanul Haque

MBA 19th
Major in HRM
ID No. 0000000000000
Banking business during the recent time period has witnessed a sharp change in its character and
composition due to number of reformative measures and growing demand for a variety of customer
services. An addition to these changes is introducing Collection Centre with employees who only
concentrate on the collection and recovery activities and thus separating the collection activities form
the other banking activities.
This report is prepared based on data of the Collection Centre of Standard Chartered Bank (SCB). In
preparing the present report, the practical experience of doing internship in the Collection Centre of
SCB was taken into account. The time period of the internship program was three months. During that
period, both primary and secondary data on collection and recovery, performance, management
policy, collection process, etc. were gathered and analyzed for the purpose of the present study.
Standard Chartered Bank, the leading multinational private bank, is well-established in growth
markets and aims to be the right partner for its customers. It combines deep local knowledge with
global capability and employs about 50,000 people in over 500 locations in more than 50 countries in
the Asia Pacific Region, South Asia, the Middle East, Africa, the United Kingdom and the Americas.
It is one of the world's most international banks with a management team comprising 70 nationalities.
SCB started its operation in Bangladesh at Chittagong in 1947 and since that the bank is treated as the
top class multinational bank for Bangladesh. Recently, the bank has created a remarkable example by
establishing its Collection Division which deals with delinquent customers and collect monthly
installment amount from them. The Centre is responsible to control delinquency ratio.
The Collection Centre deals with three accounts delinquent account, over limit account and FID
account. The Centre is led by Head of Collection with 4 managers and 9 teams. The Members deal
with credit cards and banking products. Banking products include personal loan, flexi loan, auto loan,
business installment loan and mortgage. Collection of credit card is arranged by 4 teams of different
buckets and that of banking products is arranged by 3 teams. Two team deals with recovery and legal
activities. Each of these teams is led by one Team Leader.
The cost budget for the centre is prepared separately. A clear distinction is made between controllable
costs and allocated costs. Controllable costs are the responsibility of Collections Head.
To provide a fair performance tracking mechanism and a basis for incentive plans or performance-
based remuneration schemes, balance score card is prepared by the Team Leaders. A formal call
monitoring process is in action to upgrade Collectors skills in performing their main function of
making calls to the clients to remind them of their dues and influence them to make payment. Other
incentive programs are also arranged by the Centre to motivate its members to raise their performance
levels to a higher standard. Its ESAU model motivates them to perform better and keep hold of the
good resources. Money collection has 90% weight in performance calculation. The Collectors of
higher bucket and the Team Leaders are also responsible for visiting the customers to inform them the
condition of accounts and the benefits of payments. Different types of trainings are also arranged for
the members.
In the Collection Centre, the Collectors mainly perform two jobs in the collection process, one is tele-
call to delinquent customers and another one is letter sent to delinquent customers. Generally, the calls
are frequently made in the collection process. When the accounts seem to be difficult and risky, letters
are sent. Minimum mandated collection strategies include pre-delinquency strategies, over limit
strategy, dunning letter, settlement policy, debt relief policy, recovery strategy, agency strategy and
legal strategy. For secured products, debt relief strategy and repossession strategy are applied.
The trend of the Collection of the bank is positive and during 2002 to 2006 it increased an average
rate of $87.9 million per year. The growth rate and acceleration rate of collection is 11.68% and
8.09% respectively. The results indicate that the collection in the years to come will grow with an
increasing rate. During the said period, average amount and standard deviation of collection were
$747 million and $149.98 million respectively. This is indicative of the phenomenon that there were
marked variations in the collection amount from one year to another.
The total collection cost of SCB in Bangladesh is influenced by various internal and external factors.
The study found that if the cost of collection from unsecured products increases by BDT 1 thousand,
total cost of collection decreases by BDT 0.864 thousand, if the cost of collection from secured
products increases by BDT 1 thousand, total cost of collection increases by BDT 6.795 thousand and
if the number of Collectors increases by 1 thousand, total cost of collection declines by BDT 1.086
thousand considering in all the cases, other variables remain unchanged. The correlation coefficient is
0.99 indicating high degree of relationship. The three variables combinedly explain 98% of the
variations in the total cost and the number of Collectors exerts more influence on the cost of
collection.
Performance ratios calculated for banking products based on the month January, February and March,
2007 fluctuated for the short time frame. Sill an alarming tendency is identified among the Collectors
of higher buckets as they are succeeded in regularizing accounts, but the deviation from the targeted
amount is still high, whereas the Collectors of X DPD show better performance irrespective of
banking products.
The recovery of the Collection Centre is positively related to commission cost. The correlation
coefficient between the variables is 0.99 and the factor explains 98% of the variations in the amount
of recovery. The multiple regression analysis is significant at 1% level.
During the period under review, the recovery pool form credit cards increased by BDT 13,793,377 per
year. Base on the managements expectation of recovery in 2007 form credit card (15%) and
predicted payment from the non-paying account will stand at BDT 3,370,484.43 assuming the number
of non paying account, proportion of payment from non paying account and average payment of 2006
will be reflected in 2007. Projected recovery for banking products includes 36% BIL, 13% Auto, 18%
PL and 33% Flexi loan.
The benefit-cost and NPV analyses of the regular recovery project, legal team project and agency
project are acceptable with ratios 9.4, 6 and 12.73 respectively and positive NPVs. The capacity plan
developed for the month March, 2007 reveals requirements of 2 additional Collectors for the personal
loan team.
The study found that establishment of Collection Centre of SCB could enhance its operational
efficiency in collection and recovery and maintain customers goodwill. The activities of the
Collection Centre have positive influence on banks overall profitability and reducing the amount of
provision. In comparison to the benefit of collection, the project of separating the Centre is still being
proved as a cost effective and profitable intervention.
Table of Contents
Chapter 1: Background Information and Methodology 1-3
1.1 Introduction 01
1.2 Objectives of the study 01
1.3 Methodology 02
1.4 Limitations of the study 03
Chapter 2: Collection Center of Standard Chartered Bank: An overview 4-22
2.1 Significance of Collection Center: Theoretical Aspects 04
2.2 Collection Center: The Case of Standard Chartered Bank 06
2.2.1 Background of Standard Chartered Bank 06
2.2.2 Collection Center of Standard Chartered Bank 08
2.3 Management Hierarchy 10
2.4 Management Policy 12
2.4.1 Cost and Cheque Management 12
2.4.2 Debit Processing and Bucket Calculation 13
2.4.3 Collector Performance Management 14
2.4.4 Agency and Legal Unit Management 19
2.5 Consumer products of the Collection Center 20

Chapter 3: Collection Process and Strategies of the SCB 23-40
3.1 Collection Negotiation Techniques 23
3.1.1 Solution Selling and Managing Resistance 24
3.2 Collection Strategies 25
3.2.1 Minimum Mandated Strategies 26
3.2.2 Collection Strategies for Secured Products 29
3.2.3 Interest of Classified Loan 30
3.3 Collection Steps for Consumer Products 30
3.4 Agency File Handover Process 31
3.5 Recovery Strategy 32
3.6 Management Information System 34
3.7 Architecture and Infrastructure 35
3.8 SWOT Analysis 40
Chapter 4: Performance Analysis of Collection and Recovery of SCB 41-69
4.1 Trend Analysis of Collection 41
4.2 Growth and Acceleration Analysis 42
4.3 Analysis of the Determinants of Collection Cost 43
4.4 Cross Sectional Analysis 45
4.5 Regression Analysis: Recovery and Commission Cost 63
4.6 Recovery Trend Analysis 65
4.7 NPV and Benefit-Cost Analysis 66
4.9 Capacity Planning for March07 69
Findings and Conclusions 70-74
Appendixes 75-97
Background Information and Methodology
1.1 Introduction
In Bangladesh, collection and recovery of loan is a vital issue, probably no less important
than the law and order issue. It could be a tough job- a battle against one of the most powerful
segments of the society- the rich. Public opinion needs to be mobilized and neutral media
should get involved against defaulters. The debate on the relationship between commercial
banks scope and their efficiency in handling defaulters and recovery has gained momentum
in recent years.
Standard Chartered Bank (SCB), the leading multinational bank in Bangladesh has created an
example of collecting payments from its clients who fail to make payments and become
defaulters. The bank has separated its collection and recovery activities from the other
banking activities and established an independent Collection Centre at Dhanmondi (Address:
House - 21, Road 8, Dhanmondi, Dhaka 1205, Bangladesh). The bank has developed a
system that ensures payments to be made against bad debts unless transactions are carried out
side the banking network. To shade light on such important area of study Collection and
Recovery Activities of Banks, this paper represents an overall view on the Collection Centre
of the Standard Chartered Bank (SCB). So the importance of the study aiming at assessing
success status of the Standard Chartered Bank (SCB) in establishing the Collection Centre
and measuring its operational effectiveness can hardly be overemphasized.
1.2 Objectives of the Study
The broad objective of the report is to analyze the operational effectiveness of the Collection
Centre of Standard Chartered Bank (SCB). Keeping it in mind, the study includes some
specific objectives that are stated below:
Examining the management policy applied in the Collection Centre
Highlighting the collection strategies and procedures
Focusing on the management structure and MIS
Chapter 1
Assessing the dynamics of collection and recovery activities in terms of trend
Identifying the determinates of collection cost and recovery amount
Performing NPV and benefit-cost analyses of the collection projects
Developing capacity plan for month March 2007
1.3 Methodology of the Study
The primary and secondary sources of data have been used in preparing this paper. The
concerned organization Collection Centre of Standard Chartered Bank was surveyed
physically as the part of the opportunity of continuing internship in the Collection Centre.
The instruments of data collection were face to face discussion and practical experience of
working there. Interviews with the Head of Collection, Managers, Team Leaders, Supervisors
and Collectors went a long way in assisting to prepare the report. Face to face conversation
and discussion of the Collectors with customers and the conversation over telephones with
responding to their query were analyzed.
Secondary information is also widely used in this paper. The Centres published and stored
materials, like- top sheets, operational statistics and relevant available literature were
reviewed for the report. The secondary data were also collected from the officials of the
Centre to cover the architecture and infrastructure of the process. Extensive search from
various sources was conducted. Helpful information about loan default culture and relevant
regulations were collected from books, journals and online publications produced by both
academicians and consulting firms. The collected information was abundantly used to
develop the theoretical framework. Moreover, the desk study covered different local
newspapers to see the present condition of loan default condition in Bangladesh.
Collections data (from 2001-02 to 2005-06) were gathered, classified, edited and complied
for the time series analysis. The data analysis involved selected descriptive and inferential
statistics. Before that, appropriate dummy tables providing framework for tabulation and
analysis were prepared. Analytical tools used in the study included measures of central
tendency and dispersion, growth and trend analysis. Conventional statistical tools like -
graphs, charts and diagrams were used to demonstrate the scenario of collection by SCB.
Ratios of performance used by the Collection Centre were employed to provide a real picture
of collection. Multiple and simple regression models were constructed to identify the factors
determining the collection cost and recovery respectively, generated by the Collection Centre.
Besides, a capacity plan was developed to justify the requirements of the number of
Collectors for personal loan team in the month March 2007.
1.4 Limitations of the Study
In the process of conducting the study, following limitations were confronted-
Time Constraint
The presentation of the report would have been made more in depth and elaborated if more
time could be managed. In fact, time is needed in two senses. First of all, the major portion of
the report was prepared during the internship period- January, February and March (2007)
and it became a bit difficult in managing time to collect adequate information besides an
internees respective duties. Second source of time constraint is the busy schedule of the
Officials at the Collection Centre. It was very difficult to get them free and obtain some
practical ideas regarding their expectations and opportunities regarding this topic.
Difficulty in Access to Information
Standard Chartered Bank (SCB) is highly conscious of maintaining confidentiality of
information. Confidential information regarding past collection was not accurately obtained;
rather the information was represented in approximate form as the bank is very conservative
and strict in providing information and disclosing their limitations. As data used for the
purpose of analysis were in approximate forms, certain level of inaccuracy existed in the
analysis. The Bank only publishes its annual report in England. So any copy of the annual
report could not be collected.
Limited Coverage
Self interpretation was applied in analyzing the collection performance in three specific
months. In that analysis, only banking products (BPs) were covered, but credit cards (CC)
were excluded. Because, in the Collection Centre, credit cards are dealt in wide range and it
was difficult in collecting information from the 4(four) Team Leaders of credit cards. If a
comparison in collection could be made with other banks, the analysis would be more value
Chapter 2
added. Limited experience towards practical job fields and limited knowledge might hinder
to produce an absolute authentic and meaningful report.
Collection Centre of Standard Chartered Bank: An Overview
2.1 Significance of Collection Centre: Theoretical Aspects
Non Performing Loans (NPL) reduces the loanable funds by stopping the flow of recycling of
loans and because of setting aside loan loss reserve. When money lent to a group of
borrowers is recovered, only then it can again be disbursed to other borrowers and thus the
process of credit operation can go on as simultaneous process, which ultimately influences
the banks profitability. Loan monitoring and collecting is a continuous process in banking so
as to define and maintain its assets quality and to prevent the clients form being default.
In respect of commercial banks, Desai (1980) suggests that the key areas of performance are
deposits, advances to priority sectors, credit to public and preferred sectors, foreign exchange,
cost and expenditure, profitability and customer service. The recovery activities and recovery
performance of a bank is directly related to some of his identified areas, like- advances to
priority sectors, credit to preferred and public sectors. Makarand (1979) in a recent study
proposes for six indictors as the determinants of the profitability of the banks viz. branch
expansion, priority sector credit and collection, deposit mobilization, export credit, net profit
to working funds and wage cost of business development. This is called the Integrity Priority
Index (IPI). Collection from the disbursed funds is a part of this index. According to the latest
World Bank Report, the financial sector remains vulnerable with non performing loans
accounting for a third of the loan portfolio.
As reported in the Daily Star (December, 2006), BDT 4.5 core was drawn from the account
of a company where the available balance was only BDT 10,000 (ten thousand). In fact,
Bangladesh is a unique country where people can manage to acquire goods and services or
even solid cash with a promise to pay. But the promise will never be fulfilled. Such
transactions are considered to be grand accomplished by the privileged few who eventually
become the leaders of the society and captains of the industry. One can borrow huge sums
against fictitious projects and just vanish with money. Our society has been badly tarnished
by default culture. However the major source of this default culture is the huge bag of
overdue loans with the banks. If all sorts of undue human interference with banking
operations are minimized through computerization, such over drawing of accounts, which
amounts to Criminal Act, can be made impossible. The defaulting enterprises and the clients
are likely to fail to carry out their day-to-day operations in view of the cash crunch that they
would inevitably face. The defaulters would run up to the banks and handover whatever
assets they have. The bank will then sell those assets and converts bad debts into good loans
as far as possible. If as a result, 20% out of 30% of the total loan portfolio which are
nonperforming can be recovered- the job is done; in fact well done.
While inaugurating the Silver Jubilee Celebration of Bangladesh Institute of Bank
Management (BIBM) in 1999, Former President Justice Shahbuddin Ahmed stressed the
development of the banking sector for the growth of the national economy. He focused on the
number of problems of banking sector. The main problems that he identified were financial
mess, loan default culture, and negative activities of trade unions, excess manpower,
corruption and lack of ethics (Source: Daily Prothom Alo).
Lutfar Rahman Srakar, Ex- Governor of Bangladesh Bank also recommended that the
outstanding loan amounted to 35% of all issued loans and their delinquency had made it
difficult for banks to operate and the legal loopholes had made it difficult for banks to operate
(Source: Reuters Limited, 1998).
Since as per directives of Bangladesh Bank (BB), branches are required to classify its loans at
the end of each quarter, branches may not exercise separate conditioning procedure rather
strictly follow the loan classification and provisioning procedure set by Bangladesh Bank
vide its BRPD Circular no. 16 dated 06.12.98. BRDP Circular no. 16 of 1998 is the latest
classification and provisioning guidelines framed by Bangladesh Bank successive to BCD
Circular no. 34 of 1998 and 20 of 1994. The procedures cover the entire gamut of loan
classification, suspension of interest due, making provisions against potential loan loss
(Source: Bangladesh Bank web site).
With the view of improving, the efficiency in the banking sector, there is no option to
increase the collection from the funds disbursed to the customers. Previously, the banks
considered the collation and recovery activities as the part of the loan and advance
department, where in most of the cases, the employees who disbursed the funds were
responsible for recovery of the loans. But now, in order to keep pace with modern economy
and considering the high rate of default, the banks are separating their collection and recovery
departments form the loan and advance departments. The foreign banks, like- Standard
Chartered Bank (SCB), HSBC, etc are playing pioneer role in this case. This arrangement is
not only increasing the volume of collection and recovery, but also is generating employment
opportunity and creating valuable example of transferring Non Performing Loans in to
Performing Loans.
2.2 Collection Centre: The Case of Standard Chartered Bank
Fraud management itself has become a huge business and Bangladesh with its wide spread
default culture has become a prolific breeding ground for uncounted number of frauds. The
Collection Centre of the Standard Chartered Bank (SCB) is leading the mission of developing
default free culture in Bangladesh. Before representing the Collection Centre of Standard
Chartered Bank, the background of the bank is being represented.
2.2.1 Background of Standard Chartered Bank
Standard Chartered Bank, incorporated in England with limited liability by Royal Charter
1853, Reference Number ZC 18, is the leading Multinational Private Bank offering full range
of consumer and wholesale banking, international trade, foreign exchange, lease finance and
capital market services. The principal office of the Bank is situated in England at 1,
Aldermanbury Square London EC2V 7SB. Its three core markets are in Hong Kong,
Singapore and Malaysia and offer significant opportunities. It has strengthened its position by
moving branches to areas which offer greater opportunity for revenue enhancement. The
bank has increased market share and revenues in its existing businesses and has identified
new products and customer segments to drive future growth. Standard Chartered is listed on
both the London Stock Exchange and the Stock Exchange of Hong Kong and is in the top
hundred companies, by market capitalization. The bank is well-established in growth markets
and aims to be the right partner for its customers. It combines deep local knowledge with
global capability. The banks e-commerce activity has progressed significantly. The bank is
trusted across its network for its standard of governance and its commitment to making a
difference in the communities in which it operates. Standard Chartered employs about 50,000
people in over 500 locations in more than 50 countries in the Asia Pacific Region, South
Asia, the Middle East, Africa, the United Kingdom and the Americas. It is one of the world's
most international Banks, with a management team comprising 70 nationalities. The
acquisition of Grindlays has allowed the bank to make a major leap in the Middle East and
South Asia, making it the leading international bank in the region. Since announcing
acquisition, the bank mobilised a sizeable team across both Banks to plan for the integration.
The bank has bought a highly regarded business with a strong management team where there
are excellent opportunities for synergies. The bank continues to add blue chip names from the
United States and Europe to the clients.
Standard Chartered Bank opened its doors as the Chartered Bank in Bangladesh in 1948,
opening its first branch in the port city of Chittagong. The branch was opened mainly to
facilitate the post-war-re-establishment and expansion of South and Southeast Asia. The bank
opened its first branch in Dhaka in 1966 and shifted its headquarters from Chittagong to
Dhaka after the birth of the Republic of Bangladesh in 1971.This is the only bank that did not
close its doors during the Liberation War in Bangladesh in 197. It acquired Grindlays
business from ANZ in 2000. Bangladesh is the first beneficiary of Standard Chartereds
Seeing is believing. The bank first issued credit card in 1997 and since then it has been the
market leader of the business. It has around 90,000 (ninety thousand) customer bases and
now capturing almost 80% market share in the country. Besides, the bank is top rated sub
custodian since 1995. With 18 (eighteen) branches and 24 (twenty four) ATMs, the Standard
Chartered is the oldest and largest foreign bank with its presence in six cities and the bank
completed its hundred years in Bangladesh. Standard Chartered Bangladesh was awarded as
the Best Bank of 2005 in the foreign bank category by Bankers Forum. This was
announced in the Bankers Forum Award 2005 ceremony held on June, 17, 2006. Chief
Guest of the ceremony, Dr. Wahiduddin Mahmud handed over the award to Osman Morad,
Chief Executive Officer (CEO), Standard Chartered Bank.
The other features of Standard Chartered Bank in Bangladesh are mentioned here:
Mission - To be the right partner of the customers of the bank.
Vision - To be the best international bank in Africa, Asia and the Middle-east by 2010.
Objectives - To remain number one credit card issuer in Bangladesh and expand the business
by acquiring more merchants and increasing the client base of cards.
Strategic Intent The Worlds best international bank, leading the way in Asia, Africa,
Middle East
Brand Promise The Right partner leading by example
Values Responsive, Trustworthy, Creative, International, Courageous
Commitment to Stakeholders
Customers Passionate about the customers success, delighting them with the quality of
the banks service
Its people Helping people to grow, enabling individuals to make a difference and teams
to win
Communities Trusted and caring, dedicated to making a difference
Regulators Exemplary Governance and ethics wherever the bank is
Its agenda for 2007 are - accelerating organic goal, delivering on acquisitions, improving
continuously, building leadership and reinforcing its brand. Being a country mostly
dependent on small business, business opportunities are abound in Bangladesh to let small
and medium sized enterprises to grow. To take advantages of these business opportunities,
working with the right business partners is the key. SCB is leading the way by being the first
in launching Business Financial Services on March 2004. A business can avail of deposit
products for timely utilization and easy access to their funds. Credit facilities with flexible
repayment options, trade services for domestic and international and many other products and
services tailored to their specific requirements. The offerings of the SCB are:
Deposit products - Business account, cash management services
Credit facilities - Business installment loan, secured overdraft, revolving loan
Trade services - Letter of credit, guarantee
Thus the Standard Chartered Bank serves as the one stop solution for growing business in
Bangladesh.
2.2.2 Collection Centre of Standard Chartered Bank
The Collection Centre of Standard Chartered Bank represents a new concept of collecting
payments form the default companies and customers effectively. This Centre plays an
important role in ensuring the profitability and quality of the portfolio of the bank by
collecting the delinquent receivables (explained later on) efficiently and effectively. The
basic goal of the Collection Centre is to obtain payments promptly. On the other hand, the
Centre emphasizes on minimizing the collection expenses and write-off costs, other wise the
benefit of collecting payments will decline to cover the excess costs; whereas in the process
of collection, it never neglects to maintain the customers goodwill by a high standard of
service. For this reason it is important that the Collectors should endeavor to resolve the
account that is worked for the first time. This can be achieved by identifying early signals of
delinquency and thus minimizing losses.
Key success factors of efficient and effective collection management comprises of
appropriate investment in collection systems and tools and effective use of them, right
collection strategies, strong analytical support and finally the well-managed collection
operations that motivate the people with right skill sets. The Collection Centres
responsibility will commence from the time an account becomes delinquent or over limit or
both. This responsibility persists until the account is regularized by making payment for the
delinquent account or by closing the account with full payment amount collected. The
success of the collection is highly dependent on their efficiency. In the Collection Centre, the
following three types of accounts dealt by the Collectors:
1) Delinquent Accounts
An account is classified as delinquent if the minimum contractual payment amount due is not
posted or settled, after the second statement date. The definition of delinquency is:
Table 2.1; Source: Managerial Documents of the Collection Centre
2) Over Limit Accounts
Accounts Period Explanations
Interim, Bucket0 0 The customer fails to pay on due date, but does not cross month.
X DPD, Bucket1 1-29 The sum past due is equivalent to one months minimum payment.
30 DPD, Bucket2 30-59 The sum past due is equivalent to two months minimum payment
60 DPD, Bucket3 60-89 The sum past due is equivalent to three months minimum payment
90 DPD , Bucket4 90-119 The sum past due is equivalent to four months minimum payment
120DPD, Bucket5 120-
149
The sum past due is equivalent to five months minimum payment
150DPD, Bucket6 150 -
179
The sum past due is equivalent to six months minimum payments
Head of
Collection
Manager
Collection
Credit card,
Personal
loan
Officer
Collection
Credit card,
Personal
loan
Officer
Collection
Credit card,
Personal
loan

Team
Leader
Personal
loan
Team
Leader
Flexi
loan
Team
Leader
Credit
Card
Team
Leader
Credit
Card
Team
Leader
Credit
Card
Team
Leader
Credit
Card
Manager
Collection
SME and
Secured
Officer
Collection
SME and
Secured
Team
Leader
SME and
Auto
Manager
Collection
Strategy &
Analytics
Assistant
Manager
Legal and
Recovery
Officer
Collection
Legal and
Recovery
Team
Leader
Recovery
Team
Leader
Recovery
Credit Limit means the maximum debit balance permitted by the bank for an account. An
account is considered over limit when the outstanding balance exceeds the credit limit by
100% or more. Over limit charge will be imposed in that case.
3) Non-Starter Delinquent/First Installment Default (FID)
A Non-starter is a customer who does not pay on the first billing or fails to pay the first
installment of the loan. This type of accounts may arise if the customer does not receive the
statement caused by incorrect data input by the bank or mail-dispatching error by the courier
or does not know his/her obligation. Besides, he/she might be unfamiliar with the terms and
conditions or in financial difficulty, but aware about obligation.
2.3 Management Hierarchy of the Collection Centre
Management hierarchy of an organization represents the set of interpersonal relationships
which operates in the context of position procedures, process, technology and social
environment comprises. The hierarchy of the Collection Centre is here:
Fig 2.1: Management Hierarchy of the Collection Centre
The Head of Collecting is the leader of Collection Centre and holds the
topmost position in the hierarchy. The Officers of the Collection Centre
are working under the direct supervision of the Managers. The Customer
Assistance Officers (CAO), serving as the Team Leaders report to these
Officers and assist the Customer Service Advisors (CSA) or Collectors of
their teams. As the part of discussion on the management hierarchy of
the Centre, the roles played by the Head of Collection and other Officials
of the Centre have been discussed.
Responsibilities: Head of Collection
The main responsibility of the Head of Collection is to ensure and arrange effective
management of collection operations, set right collection strategies to optimize collection
results, review the state-of-the-art systems and technologies available in the industry, make
right investment recommendation, manage a highly motivated, well-trained, highly
productive and objective-driven group and consult with the Managers so that appropriate
changes can be made to policies and procedures.
Responsibilities: Collection Manager, Unsecured/Secured Product
Collections Managers deal with both the secured and unsecured products. Whatever is the
security status of loans they engage in the recruiting, training and managing performance of
the pre-charge off collection team, collection resources and flow rates to prevent accounts
from flowing down to charge off. The Managers are also engaged in BPR (Business Process
Reengineering) for the Centre.
Responsibilities: Manager, Recovery and Legal
The main responsibility of the Recovery and Legal Manager is to maximize net recovery with
minimum recovery cost, coordinate legal activities, ensure efficient and effective
management of agencies, involve in recruitment, training and performance management of
the recovery team, repossession, liquidation and administration management of security.
Responsibilities: Manager, Strategies and Analytics
The Manager enhances and coordinates with Information System (IS) to resolve all
collection related system errors, maintains system parameters of CWX, evaluates the
effectiveness of all collection strategies, tastes user acceptance for all collection related
system enhancements and coordinates the evaluation process of new collection system and
makes recommendations.
Responsibilities: Customer Service Advisors (CSA) or Collectors
The key responsibilities Customer Service Advisors (CSA) or Collectors are
contracting effectively with the customers of delinquent accounts in order
to regularize those accounts, being good listener, improving flow rates,
ensuring customer satisfaction, retaining and communicating and
reducing delinquency and charge-off, possessing excellent interpersonal
skills and sound negotiation ability.
2.4 Management Policy at Collection Centre
The Collection Centre of Standard Chartered Bank (SCB) is efficiently designed with
management policy and practices which ultimately contributes to the efforts of the Collection
Members. Management is a distinct process consisting of activities of planning, organizing,
actuating and controlling performed to determine and accomplish stated objectives with the
use of human beings and other resources (Terry, Franklin). This segment of the report focuses
on some remarkable management policy of the Collection Centre.
2.4.1 Cost and Cheque Management System
Collection costs are compiled and compared to best practice benchmark. This comparison is
needed to assess whether the budget for cost is adequate or not and whether there is any
deviation between the actual cost and budgeted cost. In case of existence of any deviation, the
reason of the deviation is identified and corrective action is taken. In order to ensure that
collection costs are correctly identified, a separate cost centre is used to tag all collections
related expenses. There is an agreed methodology to allocate expenses by product lines
accurately (Management did not disclose the methodology as it is confidential information).
Collection cost is broken by products by X DPD, 30 60 DPD and Recovery. A clear
distinction has to be made between controllable costs and allocated costs. Controllable costs
are the responsibility of Collections Head. The cost of collections includes - staff cost that
includes salary and overtime cost, system operating cost and enhancement cost, premises,
infrastructure and related costs, communication cost, postage and stationary, external agency
related cost, legal cost, repossession cost, auction cost, cost of maintenance (utilities /
property management / security), insurance, etc.
When the customers are granted credit, they are to decide a specific date when the
repayments will be made on the monthly basis. The probable dates that may be selected are
1
st
, 8
th
, 16
th
and 25
th
of the months. They sign on the number of Undated Cheques (UDC)
that contains the monthly installment amount, but no date is mentioned on the cheques. The
cheques are given to the bank while collecting loans and are stored in the asset office. At the
date selectedthrough negotiation (any of 1
st
, 8
th
, 16
th
, and 25th), the cheques are placed for
clearing after writing proper dates. If the cheques are dishonored, those come to the
Collection Centre. The databases of those cheques are sent from the asset office. These
cheques are treated as Post Dated Cheques (PDC).The Collectors then talk to the customers
and if the customers agree to make payment and ask to place cheques (PDC), the Collectors
place those.
2.4.2 Direct Debit Processing and Bucket Calculation Based on
Installments
Bank has the right to debit the customers account against the overdue
payment under the clause Bankers Right of Set off. While debiting
general account, the debit request is forwarded to the branches for the
posting of funds into the respective account. For secured products, an
instruction is forwarded to the Manager for encashment. Manager at his-
own discretion can advice account services to en-cash lien at any point of
delinquency stage.
An Arrears Ratio is used for determining bucket. The ratio is calculated by dividing the total
arrears outstanding by the Equal Monthly Installment (EMI). EMI or Equated Monthly
Installment is the amount a customer has to pay every month to pay back that loan. The
following matrix is applied for identifying buckets:
Number of missed
installment
DPD Explanation
> 0 and =< 1 X DPD / Bucket 1 At most 1 EMI is due
> 1 and =< 2 30 DPD / Bucket 2 At most 2 EMIs are due
> 5 150 + DPD / Bucket 6 More than 5 EMIs are due
Table 2.2; Source: Customer Service Advisors
The showed calculation reveals a customer will be termed delinquent when he/she is less than
or equal to one installment due.
2.4.3 Collector Performance Measurement and Management
The Collectors performance management demands sincere management attention as the
performance of the Collectors is directly related to that of the Collection Centre. The
Collection Centre of Standard Chartered Bank includes some specific policies in the
performance management process. This segment of the report focuses on the management
policies applied for performance management.
Balance Score Card
Balance Score Card is a balanced measurement of the Collectors performance, which takes
into consideration the efficiency, effectiveness as well as quality measures. The main
objectives of the balance score card are to set a model behavior for Collectors, benchmark
their performance against clearly defined standards so that it is clear to them where the gaps
are and how to close them.
Collectors Code of Conduct
The Code of Conduct proposed by the management for the Collectors are represented here:
Collectors must not communicate with customers in a threatening or abusive manner,
must treat customers fairly and not mislead them, must respectfully decline any offer or
benefits from the customers or agencies.
Without explicit authority of SCB, a Collector is strictly forbidden to collect any annual
fee, service charges, other fees or compensation from customers. Collectors are not
authorized to promise credit limit increase, annual fee discount or waiver of financial
charges.
Collectors must never copy or duplicate customers personal data or information for
personal reference or use. All Collectors are bound by the secrecy declaration and
confidentiality clause and never to disclose any confidential data of the customers of
SCB to a third party.
In the event of detection or knowledge of any dishonest practices within the Collectors
workplace, the Collectors are obliged to inform the agency and SCB at the earliest
instance. Collectors must never talk to media or regulators on any SCB matters, be it
implied or otherwise. Collectors must not permit any one to use their system passwords
premises access cards.
Collectors must strictly follow and observe instructions from SCB and bench of any of the
above will result in immediate termination of the Collector.
Call Monitoring
The primary objective of call monitoring is identifying opportunities for Collectors to
improve their communication skills so that they may get firm payment commitment from
customers. Secondary objectives of the call monitoring include identifying training needs for
the Members, recognizing good performance and improving Supervisor and Collector
relationship throughout the organization.
While monitoring calls, a supervisor evaluates the following characteristics of the calls:
Content The content of the call is determined by listening to the telephone conversation
between the Collectors and the customers. Based on the content of the calls, a Supervisor
will distinguish the type of calls and analyze the Collectors abilities to address the
situation quickly and appropriately.
Call duration - Call duration may be impacted by technologys response time and how
quickly Collectors can access system information. . It is not unusual for a Collector to need
to view at least two to three screens to handle a call. Collectors can spend a lot of time
flipping through screens to get information.
After-call work time - This is the time Collectors spend updating the customers record
with the call results. Experienced Collectors usually update the customers records during
the conversation.
Call Monitoring Attributes/Checklist
Supervisors use a check-off list to evaluate the call while listening to the conversation. The
indicators, such as the Collectors ability to identify the customers, verify information, and
practice effective listening skills, may be rated on a scale from 0 (poor) to 2 (excellent).
The scores are totaled and the Supervisor may write freeform comments about the call. This
information is then provided to the Collectors with appropriate feedback and coaching tips.
Collectors feedbacks are evaluated by identifying opportunities, meeting goals, motivating
clients, working together, developing action plan, correcting behavior, using objective
information, delivering feedback on time and positively. The Supervisors consider a
Collector excellent and give him/her two marks if he/she consistently performs the basics,
turns broken promises in to kept promises and finally learns from past experiences.
Incentive Programs: ESAU
Incentive programs may be implemented based on balance score card result to motivate the
Collectors and to achieve better standards by linking the Collection Centre goal with
Collectors personal interest. Bangladesh collection has designed and implemented the ESAU
model in August 2003 towards achieving the highest level of performance standard.
Performance standards are as follows -
E= Excellent Performance standard > = 100%.
S= Satisfactory Performance standard > 85% <100%.
A= Average Performance standard > 70% < 85%.
U= Unsatisfactory Performance standard < 70%.
Newly recruited Collectors are matched into average performance group for first 3 (three)
months. Team Leaders are categorized in the excellent group by the virtue of their position.
However, Manager Collections reviews the performance of the Team Leaders and can change
the team leadership at his discretion. Termination of contract implies on Collectors who
remain in unsatisfactory area for consecutive two quarters. Awards are given in terms of
performance & extra effort towards the collection for better motivation. The incentive plan is
well defined with no ambiguity and made available to the Collectors.
Table 2.3; Source: ESAU Model, Managerial Documents
The chart represents the award structure, which is explained here:
The Collector of the month - Highest performance (weighted average %) is the basis of
the Collector of the month. Two Collectors from Collections (cards and banking products)
and one from recovery are awarded in the category.
The All Round Performer of the month - Any other substantial achievements along
with the high level of performance (minimum of 85% achievement) are the basis of this
category. Two Collectors are awarded as the all round performer of the month, one from
credit card and another from banking product.
The Leader of the quarter - High level of team performance (minimum 85% weighted
average) to reduce the bucket flow and minimize the risk are the key factors for
consideration of this category. Two team leaders are nominated as the leader of the month
on the basis of the overall performance from both the products. The Team Leader of the
Month award is given on quarterly basis.
Half-Yearly award - Consistence high level performance is the key factor for this
category. Other significant achievements, team playing and leadership quality, customer
service, interpersonal relationships are also being considered. A Trophy is to be handed
over as recognition and that can be retained forever by a performer if he/she can achieve it
for twice.
Table 2.4; Salary Structure: ESAU Model, Managerial Documents
Award No of Persons Amount in BDT Total Cost in
BDT
The Collector of the month 3 2,000 6,000
The All round Performer of the month 2 2,000 4,000
The Team Leader of the Quarter 2 5,000 10,000
Half yearly award 1 10,000 10,000
Team Leader Allowance 12 2,000 24,000
Award
Performance Monthly Basic Salary Additional Basic Commission (Monthly)
< 65% Each percentage point x 75 Not applicable
> = 65% until 100% 6500 Each percentage point over 65 % x 100
In base salary structure, each CSA receives an amount (Tk.75 X each percentage point) until
achievement of 65% and from 65% till 100% a consolidated amount (Tk.100 X each
percentage point). Thus the salary structure will help to increase the satisfaction and
motivation level of Collectors, which will be resulted in higher retention ratio.
Table 2.5; Commission Structure: EASU Model, Managerial Documents
ESAU model ensures higher performance higher remuneration tendency to perform at
consistent level increase motivation to perform better drop out underperformer fair
reward policy higher prize for higher performance propensity to perform consistently at
higher level boost motivation to perform better keep hold of the good resources.
Key Performance Indicator (KPI)
Collection unit frequently uses a term KPI Key Performance Indicator.
Supervisors monitor this indicator. KPI is based on hourly basis working of
a Collector. In an hour, how many accounts a Collector opens and works
and how many customers he/she can contact affect KPI. Office timing,
unauthorized leave, customer complain also influence KPI.
Collection Training Certificate Program: Call Monitoring Workshop
Collection Training Certificate Program assists to establish the importance of monitoring,
measuring and motivating the Collectors, define the need of call monitoring with adequate
monitoring procedures, learn coaching and give feedback techniques, define formats and
procedures to review the Collectors performance. This program is based on 3Ms:
Monitoring, Motivating and Measuring. This program evaluates collectors calls based on the
following guidelines:
Quality voice, verification, clarity, language, etc.
Effective application of techniques and call duration
Call Management controlling the conversation, handling difficult customers, etc.
ESAU Commission
CSA Category
<=65% 70% 75% 80% 85% 90% 95% 100%
Excellent Nil 2,000 2,500 3,000 4,000 5,500 7,500 10,000
Satisfactory Nil 1,500 2,000 2,500 3,000 4,000 5,500 8,000
Average Nil 1,000 1,500 2,000 2,500 3,000 4,000 6,500
Under-
performer
Nil 500 1,000 1,500 2,000 2,500 3,000 5,000
Follows policies and procedures
Compliance with laws and regulations
New Hire Training Program
The SCB Collection Centre arranges special training for the newly hired employees of the
Centre. The training program for new hires combines classroom instructions and hands -on
practice session. The classroom instructions cover organization introduction and policy
product knowledge system knowledge call model productivity indicators etc.
The hands-on practice session covers familiarization of CWX and other basic system
screens system updating techniques actual collection calls, etc. There are some ongoing
workshops and development seminars, which address specific skill sets necessary to reach
goals and business objectives as well as refresh basic collection skills. Examples of such
workshops and seminars are negotiation and telephone Skills legal system and process
field collection skip tracing skills CWX reports and KPI credit cycle unsecured
products secured products.
Supervisor and Management Training Program
Supervisors and Team Leaders are the major part of the Collection Centre manpower.
Considering this, some ongoing workshops and development seminars are arranged targeting
at Supervisors and Team leaders, which improves their skills in managing the team more
effectively.
The training category also includes SAFE (Security Awareness for Employees) and Money
Laundering Training, for which certificates are awarded.
2.4.4 Agency and Legal Unit Management
Agency management is a details framework that assists the Collection Centre to recover the
payments form which collecting payments seem to be difficult. There is a formal contract and
agreement with every external agency. The following rules are followed in the agency
management process:
Clear policy is defined when to assign the accounts to agency, how to distribute the
accounts among the agencies and how long the accounts stay with the agencies.
Consumer
Product
Banking Products Credit Cards
Flexi
Loan
Business
Installment
Loan
Auto
Loan
Personal Loan Mortgage
Agency commission structure is periodically reviewed and commission rates rationalized
and/or negotiated depending upon the volume of cases referred.
Procedure for repossession of security is defined.
A physical visit to all major locations noted in the agency proposal paper should be made.
However, these non employed personnel will not have access to any operational area within
SCB premises and will be given access to Standard Chartered computer system with proper
risk mitigation under IT Security Manual. There is no restriction on the number of agencies
the Centre may wish to contract, as long as all contracted agencies meet the agency selection
criteria.
There is monthly audit of agency both periodic as well as surprise visits. The audit covers
Collector activity and techniques financial issues (receipt book/procedures/audited financial
statements) contract compliance (legal and regulation compliance, compliance with code of
conduct, etc.
Legal procedures include handing over the file to law firm, serving legal notice, and initiating
criminal case for Undated and post dated cheques, initiating money suit case to recover total
outstanding and property attachment. Legal tools include MIS for legal portfolio
management, customer segmentation for proper analysis of asset portfolio, Central Bank
report and legal performance monitoring.
2.5 Consumer products of the Collection Centre
In Consumer Banking, despite intense market competition, the Standard Chartered Bank has
continued to grow its mortgages, cards and deposit businesses. This segment of the report
represents an overview of the Consumer Products (CP) for which the payments from the
customers are collected by the Members of the Collection Centre. The Standard Chartered
banks (SCB) Consumer Products (CP) can be categorized as follows-
Fig 2.2: Classification of Banking Products
Personal Loan (PL)
Personal loan (PL) is the most widely used product of Standard Chartered Bank (SCB). The
clients are not required to arrange any cash security for personal loan (PL). The loan is a type
of salaried loan. Under this unsecured loan category, one Grantor will remain involved and
will assure guaranty on behalf of the customer. A very flexible PL-to meet the clients
assorted needs, like- travel loan, medical loan, marriage loan, education loan for children,
home or office renovation loan. Six Customer Service Advisors (CSA)/Collectors work for
the personal loan (PL) collection team. Out of teams of banking products, it maintains the
largest team.
Flexi Loan (FL)
Flexi loan from Standard Chartered is a loan facility that has been custom designed to meet
the clients emergency needs. Flexi loan is a partially/fully secured loan. The security for the
loan should be in a readily en-cashable form. It is a very flexible loan to meet the clients
extra needs for cash, such as: house renovation, furniture or household items for personal/
family use, electrical and electronics including computer and accessories for personal use,
marriage of immediate family members, medical treatment, higher education, travel abroad,
etc. The flexi loan collection team is developed with three Collectors. The Collectors can
exercise the option of en-cashing security of the clients if it becomes necessary.
Business Installment Loan (BIL)
Business Installment Loan (BIL) is one type of secured loan. This product of Standard
Chartered Bank (SCB) can be treated as a modified and wide view of flexi loan. After
successfully completion of one year loan, the client can apply for Top-up, which may be 30%
secured. The collection team of BIL is formed with six Collectors.
Mortgage
Standard Chartered mortgage offers flexible loan amount that includes registration cost.
Mortgage does not demand any cash security. It is used to purchase apartment, continue
construction work, renovation work, to bear education/medical expenses/household
appliances purchase. Interest is calculated on a monthly reducing balance, saving hand,
earned money from unnecessary interest expenses. Applicants should have at least 3 years of
service or professional or business track records. Any leased residential property including
purchase of second hand property is the proposed property for mortgage. In the Collection
Centre, the collection team of BIL deals with mortgage.
Auto Loan (AL)
With Standard Chartered auto loan, it is easier than ever to buy the car of clients dream. SCB
offers the client a flexible and affordable loan with easy repayment options, all wrapped in
very convenient package. The loan amount depends on net monthly income. The loan is
secured by the automobile/vehicle. This automobile must be used for non-commercial
purposes. Used car (maximum 8 years from manufacturing date) can also be purchased. No
personal or corporate guarantee required. The collection team of auto loan with two members
belongs to BIL team. In case of early settlement, 3% of the outstanding loan is charged if the
loan is paid within first 6 months of loan disbursement and 2% of the outstanding is charged
if paid within first months of loan disbursement.
Credit Card (CC)
ANZ Grindlays Bank Limited first introduced the Taka credit card in Bangladesh. Credit
SCB card division offers Master Silver, Visa Silver and Master Gold Credit Card. The
Collection Centre maintains four different teams for collection from card holders. The four
teams deal with four different buckets. The range of the credit cards is larger as the number of
the SCB credit card holders is high and it is very difficult to handle a large number of
delinquent card holders by a single team.
Chapter 3
Collection Process and Strategies of Standard chartered Bank
3.1 Collection Negotiation Techniques of Standard Chartered Bank
The Collectors, while dealing with the collection process are to follow some guidelines
designed by the management of the SCB Collection Centre. The set rules and guidelines are
identified as the Collection Negotiation Techniques. These negotiation techniques improve
the efficiency and effectiveness of the collection process, ensure excellent customer service
and finally assist to meet productivity goals. According to the techniques, the SCB Collectors
while managing calls must fulfill the following requirements:
The Collectors are to use firm and friendly tone while making the calls.
They are to capture the attention of the customers by using interesting words.
They should not use any terminology or technical jargons that they use frequently
(example- PTP, FID etc) as in that cases, the customers may fail to realize their accounts
condition and the urgency of payment.
The Collectors should never forget to pursue the clients to make payments and let them
respond.
The Collectors are to control their conversation while managing calls with the client. Their
counseling approach combining two major skills - technical skills and interpersonal skills,
lead to problem solving. They start the calls strongly with the representation of the facts on
the databases containing the details information of the clients. If the customers agree to make
payment, the payments negotiation terms are to be set with the customers. The Collectors are
to confirm
When to Make Payment
How Much to Make Payment
a) Use arms and hand gestures move while talking
b) Control how sound
c) Speak clearly
d) Be attentive to pace and match with the listener
e) Match the borrowers volume
How to Make Payment
The Collectors are more tactical while dealing with priority customers. They strictly try to
avoid the negotiation loss at the time of conversation with the clients. With the view to
avoiding negotiation loss, they are to avoid personal involvement and emotional answers,
inflexible position while talking to them and setting terms, and must utilize other questions to
gain control and move forward the conversation. The Members of the Collection Centre must
be conscious of the distinctions between persuasive and pressure imposed on the customers
of the bank. If the Collectors try to create pressure on the customers, it creates negative
feelings on them which may result in barriers and rejection to make payments. On the other
hand, if the techniques of persuasion are followed, it generates security and confidence in the
mind of the customers and they will ultimately accept the arguments of the Collectors. The
designed rules for the Collectors while making telephone calls are-
Source: Collection Negotiation Techniques, Customers Service Advisors
The Collectors deal with different types of customers in the collation negation process and
their techniques of collection vary with the customers variety, like:
The customers who are willing and able to pay may miss the payment as they may forget
or overlook the payment or did not receive the monthly statement. In that case, the
Collectors only acknowledge the debt.
The customers who are unwilling and able are dissatisfied customers. The Collectors in
that case take persuasive technique for collecting payments.
Unexpected or unplanned adverse circumstances or calamity job loss, reduced hours,
illness, accident, death, divorce, etc or poor money manager, poor paying habits or
procrastination may create the situation where the customers are willing, but unable to
pay. The Collectors at that case may talk to higher authority of the Unit to assist the
customers to make payment.
Unwilling and unable customers may be imprisoned or deceased and are detected from
the collection list of the Collectors.
3.1.1 Solution Selling and Managing Customers Resistance
The Collectors, while dealing customers are to understand the problems of the customers and
try to identify the solutions so that customers can regularize their accounts. This technique is
identified as Solutions Selling. The benefits of the solution selling are receiving the total
amount, creating urgency and overcoming objections. Thats why a popular recommendation
in the Collection Centre is Collection is a Sales Job. The solution selling process
includes the followings:
Getting a commitment for an initial amount from the customers
Acknowledging the initial amount to the customers
Explaining the consequences of non payment to the customers
Selling a solutions for higher payment amount
Getting a commitment form the customers for the reminding amount
Creating urgency in the payment method
The Collection Centre allows the Collectors to ask different types of questions closed or
open ending. While asking questions, they try to influence the clients. The questions are
Firm, Fair and Friendly. (A model of desired questions is represented in Appendix 3.1).
The Members of the Collection Centre often face the resistance of the customers. In that case,
the first duty of them is to overcome the objections imposed by the clients of the bank. With
the view to overcoming the objections, the Collectors introduce themselves, show interest and
concern, listen carefully, obtain and provide information, build trust and credibility in the
mind of the clients, isolate the objections and reinforce the benefit of payments.
3.2 Collection Strategies Applied at the Collection Centre
When a customer fails to fulfill the agreement terms of payment, the account enters
Collections. Collections Department is responsible for collecting the overdue amount from
the delinquent customers. There are different stages and strategies involved in collection
process. Collection Strategies specify when to take what action on which accounts. Different
types of collection strategies are applied for:
Collecting past due funds while striving to retain customers with long term profit
potential and rehabilitating them beginning to show serious delinquency behavior
Controlling the risk from customers with a history of serious delinquency
Reducing losses from written-off customers
These objectives are accomplished while still achieving service quality standards and
conforming to all legal regulatory and internal policy requirements. There is a standard report
in automated system, called Tele-call report, which is the basic report to contact with the
delinquent customers. This report includes both provisioned and non-provisioned delinquent
accounts with all the necessary information for the Collectors and sorted by balance. At the
beginning of the month, all the Collectors get a list of delinquent customers of various
buckets. They are given one-month time to collect the due amount. The delinquent customers
are contacted over phone and will be reminded of their past due. Performance of the
Collectors is evaluated through the report on the basis of the actual overdue collection against
the target collection. Collectors are conscious of the reason(s) of delinquency which enables
them to plan an effective approach to deal with the situation. In the case where earlier
promises were broken, they reinforce the need for immediate payment. They concentrate on
establishing the whereabouts and assemble information if customers cannot be contacted. The
basic sources of information are through enquiry, previous history updated in CWX software
and through contact points at office. If these measures fail to establish any contact with the
customers, field visits for skip tracing are conducted.
It becomes necessary for the Collectors to practice a more aggressive approach for all
customers who have been contacted and who after that have broken promises. If the previous
service-oriented collection effort was not successful, it must be assumed that the customers
did not take the message seriously enough to either submit a payment. To gain the customers
attention, it may be necessary to send a letter, fax, telex, e-mail or telegram and remind them
of the consequences of the action. Once agreement is established, it is still a formidable task
to convince the customers to actually submit payment. Collectors sell the customers their
ideas of paying their past due amount. Legal enforcement through legal notices and eventual
filing of suits are also an option that they can exercise.
3.2.1 Minimum Mandated Collection Strategies
1) Pre Delinquency Collection Strategy
Accounts may be called or treated from collections prior to becoming delinquent for different
reasons. The strategy should illustrate how to identify the pre-delinquent accounts, the
treatments, timing of the treatment, tone/scripts/main message to the customer, process flow
and tracking mechanism (for evaluation of strategy effectiveness). All the collectors of
different teams receive a fresh queue list on the beginning of each month on that they work
through out the month. CWX software will allocate new inflow accounts everyday to the
designated collectors. During various crisis periods, the need to call the customers before
they become delinquent is realized. Usually a customer moves to bucket 1(X DPD), 15 days
after the payment due date. As such an initiative was taken to identify these accounts
(accounts that missed payment but yet to move to Bucket 1) and manually allocate them to
the collector.
2) Over Limit Strategy
There are different levels of an over limit accounts which are as follows:
Over limit level 1 (>110% and 120%)
Over limit level 2 (>120% and 130%)
Over limit level 3 (>130%)
Analysis shows over limit accounts have high probability of default. They are tracked
separately and given high priority in collections. Treatments to these accounts are phone
contacts/SMS, etc. The over limit strategy specifies how the over limit accounts are
identified, collection treatments (timing, intensity) at all delinquency stages, analysis to
identify over-limit reasons and tracking mechanism to monitor the effectiveness of the
strategy.
3) Delinquent Accounts and Collection Strategies
Collection Department, makes segment of delinquent accounts in to three groups - Front-End,
Mid-Range and Hard-Core. The collection strategies of these delinquent accounts are:
Front-End (1-29 DPD)
Front-end is the first collection bucket in which delinquent accounts are identified as First
Installment Due (FID). These are high-risk accounts and demand close monitoring. At this
stage, the customers are normally contacted over phones and letters. Telephone callings are
conducted in a soft and tactful manner maintaining consistency with the customer service
level. Collectors always do an inquiry through the system to confirm if payments have
already been received before making telephone calls in order to avoid misunderstanding with
the customers. If collection letters or statements are returned from the customers due to
change of addresses, it is the responsibility of the respective Collectors to collect telephone
numbers and ask the customers to provide written instructions of addresses change to the
customer service departments and at the same time, write down the new addresses and
telephone numbers to the note pad so that next time customers can get their next letters in just
time.
Mid-Range (30-59 DPD and 60-89 DPD)
Mid-range is the bucket in which the accounts are considered to be seriously delinquent.
These accounts flow down from Front-end. Collectors exercise more aggressive approach at
this stage. Collection letters are also sent to the customers. Upon successful contact with the
customers, payment dates are secured. Constant telephone calls are made to those customers
who have given numerous broken promises.

Hard-Core (90-149 DPD)
90+ DPD accounts are considered as hard-core delinquency. Collection efforts are more
intensified at this stage. Extra telephone calls and letters are mandatory. The Collectors of
secured products take steps to liquidate the security to collect payment. At 120 DPD, bad
debt is declared. Intensive Team visits are also conducted for collection. When recovery
opportunities are considered good through legal notice, Collectors make recommendations to
the management for legal notices.
4) Automated Dunning Letters
Dunning letters are useful tools to recover money from delinquent customers. Currently a
new system- CWX is used to generate automated letters for delinquent customers
from X DPD to 90 DPD. Automated Letters are sent to the customers by courier
service. Letter specifies the contents, main message, timing, and sequence and
target group of each collection letter. Proper letter head (Collection Department),
full contract information for the customers to contract, SCB address, contract
numbers, e-mail address of specific collection area are to be included. It is
important to ensure that the collection letter strategy is consistent with business
objectives.
5) Settlement Policy
Settlement policy is an integral part of collections strategy. The reasons for applying a
hardship strategy could vary based on other variables in the account profile. Settlement policy
is usually applied to the late stage of delinquent accounts or charge off accounts and it
normally comes with a waiver of partial or full interest owed, and sometimes with a discount
on the principle amount. In most of the cases, the customers for whom settlement strategy is
applied, have good intentions, but do not have the ability or do not qualify to avail the credit
facility of SCB. In such cases, a certain waiver in fees, charges and interest may result
towards effective recovery. There are also situations where payments are realized from third
party kin of customer, employer etc. waiver of fees / interest is also required in these
situations to expedite the settlement deal.
6) Remedial Management/DRP Strategy
A remedial management program or debt relief program is an installment plan to help the
customers to workout the debt situation with reduced monthly debt-servicing burden by pro-
longed repayment periods and reduced interest rates. This strategy specifies qualification
criteria, segmentation and program specification (down payment, interest, etc), process flow,
contents and sequence of customers correspondences, tracking mechanism, scripts,
expectations and main befits to sell at different stages of the process.
7) Legal Strategy, Agency Strategy, Recovery Strategy
The legal strategy outlines legal actions to be taken against past due customers including the
use of legal judgments and the initiation of a legal process against other assets (personal
and/or business) to collect past due amounts.
Agency strategies are prepared in line with the Group External Collection Agency
Management Guide. Agency strategy exists illustrating when and how to hand over files to
agency, how to follow up agency activities and how to withdraw files form agency. Agency
is the external party. So security issue arises wile using the strategy.
The recovery strategy specifies a recovery score that predicts the collection past due amounts
in the future and account assignment strategy that articulates how the portfolio is assigned
between in-house team and agency.
3.2.2 Collection Strategies Specific to Secured Products
For secured products, two risk factors are to be considered while deriving collection strategy
collateral risk and customer risk. Collateral risk is best reflected by customers current
equity level, while customer risk is determined by the customers willingness and capability
to pay. The strategies applied for secured products are highlighted here:
1) DRP Strategy
DRP (Debt Relief Program) strategy specifies the selection/qualification criteria to select the
customers for DRP program, options offered to the customers (such as - lower interest rate)
with the purpose to ease the customers cash flow pressure, approval authority, process flow,
follow up actions tracking mechanisms, etc.
2) Repossession/Eviction Strategy
Repossession/Eviction strategy specifies the criteria for repossession/eviction, with the
consideration of benefit-cost trade off. It also defines revaluation and value write down policy
and process for the security. Legal reversal criteria and process, legal document call-back
process, collateral sales process and controls, negotiation and follow up with the customers,
cost of carrying and resale, insurance policy claims and disposition of sales proceeds with
tracking mechanism are specified in the strategy.
3.2.3 Interest of Classified Loans
Interests on loans classified as bad debts may not be charged on the respective accounts.
Branches will calculate interests of monthly basis to credit the interests to interest suspense
accounts. Branches maintain those interest suspense accounts and monthly proof sheets are
prepared with the ledger balance of the interest suspense on classified loams.
3.3 Collection Steps for Consumer Products
Customer Service Advisors (CSA) or Collectors working in the Collection Centre attain
customers phone calls, listen their problems or queries and give appropriate solutions.
Oppositely, customers call to the Collection Centre to solve their problems and feel very
confident if the Members of the Centre can provide the prompt and right solutions (A model
of customers queries are represented in Appendix 3.2). The Collectors are to move through
the following sequential steps while calling the customers:
Step 1: Verifying Information
At the beginning, the Collectors verify mailing addresses, daytime
numbers, evening numbers and other telephone number(s) mobile
phone, pager, relative, etc. of the customers.
Step 2: Obtaining RFD - Reasons for Delinquency
The Collectors try to justify the reasons of delinquency, customers
financial condition, customers and/or spouses working condition or
capability, etc.
Step 3: Explaining Benefits to Pay/Consequences
This stage focuses on explaining the following benefits to the customers
Table 3.1; Source: Collection Negotiation Technique, Customer Service Advisor
Step 4: Getting Kept Promises and Maintaining Documents
The promises are taken in the following forms
How much Total amount due is informed at the beginning of negotiation
When A specific payment date is fixed
How Paying at branch, by mail, money order or account debit instruction
Where At any branch or ATM
Delinquenc
y
Benefit = Avoiding a consequence
X DPD Avoid late payment charges and restriction from limit
enhancement
30 DPD Avoid late payment charges and block status of card
60 DPD Avoid late payment charges and block status and suspension
of card
90 DPD Avoid Hot list and circulation of the same within the
merchants. Avoid being a highly delinquent customer and a
restricted person for Financial Institution
120 DPD Avoid cancellation of facility and legal action
150 + DPD Avoid dealing by collection agent and legal action
What is the source of funds Cash on hand, income, borrowing the
money, selling property
The Collectors write the concise summary and abbreviated notes of the
whole communication in the system for future references and follows up.
3.4 Agency File Handover Process
A bulk number of accounts can not be effectively contacted through phone calls due to
unavailability of the customers or addresses/phone numbers changes. These accounts do not
belong to skip cases, but are difficult to contact. Another set of customers requires field visit
for negotiation. In that case, External Collection Agencies (ECA) may be appointed. Legal
and Recovery Officer Initiates the list of files for agencies, obtains approval from Legal and
Recovery Manager and prepares an allocation package, which includes total number of files
and volume, and a hard copy of the allocated files to the agencies.
Collectors have the option to apply the agency options if they face difficulty in collecting
payments. Collectors take permission from their supervisors for assigning any new file to
agency. Supervisors then obtain approval from Legal and Recovery Manager or Officer, and
prepare allocation packages for the agency. This new file allocation will only be completed
upon signing the notification letter either by Manager- Legal and Recovery or Officer-Legal
and Recovery. The unit preserves a receive copy of the notification letter and hard copy of
the list of new files signed by the agency authorized person.
Currently there is a separate team to monitor the activities of ECAs in dealing the accounts
referred to them. If no progress is found in a number of files, Legal and Recovery Manager
can withdraw all those files at his discretion after minimum of 3 (three) months from the date
of assignment. Those files can be referred to another ECA. In the process of re-assignment of
files, list of files the withdrawn are excluded and new files may be included.
3.5 Recovery Strategy
Legal and
Recovery Team
Recovery Unit Legal Unit
Regular Team Special Team
An account is charged off when it enters 150+ DPD, therefore it fails to pay 6 (six) months
due payments. In that case, the account is treated as bad debt. Recovery unit monitors this
type of accounts with a view to maximize recovery. The structure of recovery team is as
follows:
Fig 3.1: Recovery Team Structure
3.5.1 Recovery Strategy for Credit Card
Since credit card is an unsecured product, Unit anticipates meticulous monitoring and follow
up process to ensure highest recovery effectively and efficiently. The recovery steps for credit
cards include in house telephone calls, visit customer, demand letter, recovery agents and
legal notice issuing if necessary. New charge-off accounts are dealt separately to ensure
highest recovery from those. After one month recovery effort, contactable and paying files
are handed over to regular team and non-paying and skip accounts are handed over to the
special team.
Paying accounts are monitored by the regular team. Since recovery probability of these files
is higher than that of other files, initiatives are taken for settlement by providing attractive
waivers to the customers. Non paying accounts are thoroughly monitored by the special team.
This effort includes regularizing or collecting valid addresses to shape the portfolio. Since
payment possibility from these accounts is very low, the initiatives taken are special
campaigns, like - developing new commission structure for Collectors, separating teams for
non-paying and non traced accounts, constructing recovery field visit team and using legal
unit properly.
3.5.2 Recovery Strategy for Banking Products
Organization
Organization
Management
Management
Technology
Technology
MIS
Loan products are fully monitored and managed by a combined effort comprising of in house
effort and external agency effort. As there remains a huge potential, recovery unit pays an
extra attention to ensure efficient recovery. The following are the recovery steps applied in
loan product recovery process:
Personal Loan: In house telephone calls visit customer demand letter recovery agents
combined effort legal notice criminal case
Flexi Loan: In house telephone calls visit customer recovery agents combined effort
legal notice issuing criminal case
Business Installment Loan: In house telephone calls visit customer recovery agents
combined effort legal Notice criminal case
Auto Loan: In house telephone calls visit customer recovery agents litigation
Mortgage: In house telephone calls visit customer recovery agents combined effort
Foreclosure
PL and IL are separately monitored by the in house team and agency. BIL is closely
monitored by in house team, agency and litigation (if necessary). AUTO is monitored by in
house team and repossession activities are conducted by external agency.
3.6 Management Information System of SCB Collection Centre
Today it is widely recognized that information systems knowledge is essential for Managers
as the most organizations need management information system to survive and prosper. As
the part an analysis on the Collection Centre of Standard Chartered Bank, an overview on the
MIS of this centre has been represented. All information systems can be described as
organizational and management solutions to challenges posed by environment that will help
to create value for the SCB.
Fig 3.2: MIS- The Combined form of Organization, Technology and Management
The objectives of the Collection Centre for using developed MIS are establishing the
importance of monitoring, measuring and motivating the Collectors, defining the need of call
monitoring with adequate monitoring procedures, learning coaching and feedback techniques
and defining formats and procedures to review. In the Collection Centre, the Managers,
Officers and the Team Leaders have access to the internet and intranet. They can access those
for exchanging mails and browsing. The intranet of the bank is private and is protected from
public visitors by firewalls security system with specialized software to prevent outsiders
from invading private networks.
The Team Leaders collect the information on performance of the Collectors, portfolio and
payment condition and other relevant information and mail those documents to the Managers.
After proper approval of those documents, the Managers mail those to the Head of
Collection. Information security is important for all members of the Collection Centre. All
information and assets must be protected. This includes not only the information on the
computer but also the confidential fax on the desk and conversations with clients. A large
percentage of information security problems arise because the internal staffs either
deliberately or accidentally misuse information. While sending information by e-mails, the
users of internet have to justify whether the information is confidential or its divulgence or
modifications would cause damage to the Group or its reputation. Besides, the senders are
strictly prohibited from sending any illegal, libelous, defamatory e-mails or the e-mails which
might have other adverse consequences under criminal law or civil law. The users of the
internet at the Collection Centre of Standard Chartered Bank are not allowed to load any
software on the banks computer through their access to the internet at office. While sending
information by e-mails, the users of internet have to justify whether the information is
confidential or its divulgence or modifications would cause damage to the Group or its
reputation. Besides, the senders are strictly prohibited from sending any illegal, libelous,
defamatory e-mails or the e-mails which might have other adverse consequences under
criminal law or civil law. They should not use e-mails for highly confidential information
where they must be sure that only they and recipients can read or modify the mails, even it is
inside the Group as in the internet, and a large group of people can read mails. Only the
senders, recipients and a small group of trusted Staffs can read an ordinary e-mail sent inside
the team. If it becomes an emergency to use e-mails for exchanging confidential information,
they will have to talk to the Information Security Team (IST) about using encryption to
protect the information.
3.7 Architecture and Infrastructure of the Collection Centre
The architecture of the Collection centre represents its practice of applying a comprehensive
and rigorous method for describing a current and/or future structure and behavior the
collection processes, information systems, personnel and organizational sub-units, so that
they align with the organization's core goals and strategic direction. The primary purpose of
creating enterprise architecture is to ensure that business strategy and IT investments are
aligned. Its infrastructure provides the foundation on which the Collection Centre can build
its specific information system. It consists of computer hardware, software, data and storage
technology and networks providing a portfolio shared information technology resources. As
the part of the analysis on the architecture and infrastructure of the Collection Centre, the
movement from its strategic goal to the infrastructure has been explained here.
Step 1: Setting Strategic Goal for the Collection Centre
The goal of the collection process is to obtain payments promptly while minimizing
collection expense and write-off costs as well as maintaining the customers goodwill by a
high standard of service. For this reason, it is important that the Collector should endeavor to
resolve the account the first time worked. Collection also protects the assets of the bank.
Step 2: Translating Strategic Goals to Business Requirements
In order to achieve the strategic goals, the architecture of the Collection Centre needs to
translate its strategic goals to business requirements; some of the business requirements are-
Providing training to the Members of the Centre in relevant softwares and security of the
system
Maintaining proper communication with the clients and among themselves
Maintaining efficient and updated databases, etc.
Step 3: Appling Strategy-Architecture-Infrastructure Frameworks
One of the major components of architecture deals with how to obtain, store and use data to
support the business requirements. The Collection Centre has client-server architecture to
share data from the sources to final storage and report preparing. The client/server software
architecture is a versatile, message-based and modular infrastructure that is intended to
improve usability, flexibility, interoperability, and scalability as compared to centralized,
mainframe, time sharing computing. It maintains Multiple Database Management System
(MDBMS) and distributed server. Using a Relational Database Management System
(RDBMS), clients queries can be answered directly by seeing transaction conditions
displayed in the eBBS software (discussed in software segment).
Step 4: Translating Architecture into Infrastructure
Good Operation Infrastructure is fundamental to smooth running of collection operation. The
key elements of a good collection infrastructure other than system are:
Brightly lit interiors
Space allocated to each agent is not congested
Hands free telephone instruments, mobile phones, bulletin boards
Notice boards to display productivity/effectiveness
Refreshment / recreation room, meeting and training rooms
Work flow management to reduce paper/non-call related work for Collectors
Back office tasks automated to the extent possible
The Floor Plan in the Collection Centre is set up as that of a call centre with proper partitions
and enough space between Collectors. This arrangement helps the Collectors to focus on
managing the production of calls. Supervisors and Team Leaders workstations need to be
closer to each group of Collectors to enable Supervisors answer Collectors questions on the
floor, handle calls from difficult customers who make problems in making payments or who
are traceless, make decisions about specific customers situations, respond to customers
complaints, etc. MIS infrastructure is developed with hardware, software, data and network.
A brief description of MIS infrastructure of the Collection Centre is represented hare.
Hardware
Hardwares used by the Collection Centre are all from the DELL Corporation. These
hardwares are allocated to the Staffs from the head office and the Staffs have their own IDs
and passwords for accessing their personal computers (PCs). The Team Leaders are
responsible for informing the higher authority about the requirements of hardwares.
Software
SCB has the most updated computerized system to run the business and keep record of the
transaction and repayment history, which other card issuers and lenders in the country do not
have. The system is online and can keep all the information regarding customer, transaction,
merchant and other related issues This segment will represent a details of the custom made
softwares (Programs written for specific purposes and specific organizations) of the
Collection Centre.
1) Collection Work (CWX)
Collection Works Exchequer (CWX) software was installed in Bangladesh in July 2005. At
that time, users of the software and supervisors were trained up. CWX is being used for credit
cards (CC) and banking products (BP) from August and October 2005 respectively and since
December 2005, the software is assisting the call monitoring process. The core collection
system CWX is used by all the collection Staffs and Supervisors for day to day collection
activities. Through this software, the Collectors at a glance find customers different
important information and collection history. Not only that, if customer has any complain, the
Collectors can easily and promptly transfer those to their supervisors. Bucket wise inventory
report and the report segregated by starter / nonstarter are represented by CWX. It is used to
prepare and finalize Performance Appraisal Reports on monthly basis. These reports are
prepared by the Collectors that include detailed report containing card number, limit, balance,
minimum due, collected amount and minimum due recovered. The reports also cover the
summary reports containing performance parameters. It assists in identifying key
performance indicator (KPI) of the Collectors.
There are two separate versions of CWX are:
One is the collector version which is used by the Collectors and Team Leaders to view
and work on their queue.
The other version is on the supervisory module which is used by the Team Leaders and
Managers. Here, the Team Leaders can view their team productivity and efficiency
reports and the Managers can set system parameters and view the portfolio level reports.
2) ebbs Software
eBBS was introduced in Bangladesh in 2003. eBBS is the core banking and transaction
processing system used in Bangladesh. All the personnel of Collection Department have
access to this software with viewing rights to use the enquiry module. Live update of
enquiry of transactions and customers information of credit cards and banking products are
available from this program. Besides, if the clients maintain any linked accounts from which
payments can be collected, the Collectors click on the sweep to identify the accounts and
observe its available fund condition. They can also come to know of the personal
information, account opening area and payment pattern of the clients. It is to be included that
the Staffs of the Collection Centre can not give inputs to the system; the inputs are given at
the branches when the clients receive and pay to the accounts.
3) Cards400
Cards400 is the credit card system and all the personnel of Collection Department have
access to cards400 system with viewing rights. Like the eBBS, this software also provides
live update of enquiry of transactions and customers information of loan products. The
Collectors at the credit card segment and Supervisors have access to this system.
Other Software
DLC400 is used in dunning letter generation for credit cards.
eCRM is the software used in customer complaints management process.
eCAPS is a cards application processing system.
Differentiation in software may be needed for the sake of competitive advantage and to
comply with the change in management policy. In that case, the Collection Centre makes
some modifications on its currently used software applications. The management asks the
vendors to modify the softwares and vendors make some changes on the softwares according
to the requirements. The Centre also arranges training for both the Members of the
Collection Centre for specialized softwares.
Data
The Collection Centre uses distributed database. Most of their database software includes
tools for data analysis. Databases run securely to ensure data is adequately protected. All
routine activities are defined and documented. The security of collection related data is
strictly maintained.
Network
The network of the Collection Centre is wide. LAN access is created by using the appropriate
accounts templates to ensure that the users posses only the access for which they are
authorized. Certain cost or fees are involved in the creation of new LAN account. In the
network, access is controlled to ensure that only authorized individuals gain access to
information and system within the Group and that individual accountability is assured.
Management of a network does not decrease the level of security defined for that network or
offer new opportunities for compromise. Management communications incorporating
sensitive information is protected against unauthorized interception.
Finally, collection MIS plays a vital role in collection inventory tracking and monitoring as
well as comparing current payment flow with the past payment flow. The trends, over limit
and delinquent account trend of the customer who due their first installment (FID customers)
is also determined by MIS. The other benefits of the collection MIS are - agency performance
tracking, recovery performance tracking, legal activity effectiveness tracking, individual
Collector performance tracking (monthly balance score card), capacity planning model, auto
repossession tracking, cost tracking, etc.
3.10 SWOT Analysis on the Collection Centre
Analysis Strength (S) Weakness (W)
SW
Separated Collection Unit with
efficient manpower
Effective training and internal
control
Effective agency and legal team
Customized softwares that assist in
record keeping, monitoring
performance, etc. and online
banking
Incentive program and attractive
salary structure
Strict and well designed rules for
dealing the customers
Absence of contract
between HR and
Collectors
Communication gap
between the higher
management and
Collectors
Pressure on the
Collectors, specially at
the end of the month to
achieve targets
Analysis Opportunities (O) Threats (T)
OT
The recent improved legal and
political condition generates the
opportunity for more collection and
recovery.
The cost of appointing agency is
declining.
The bless of technology supporting
collection activities
Competitive
environment and high
standard services
provided by other
foreign banks
Entrance of new
commercial bank with
new technology
Switching tendency
among the Members of
the Unit
Performance Analysis of Collection and Recovery
Our social-economic as well as business world is dynamics, uncertain and affected by
multiplicity of causes. There is hardly a field of endeavor in which variables are not
interrelated. To analyze widely the status and performance of collection and recovery
activities of the Collection Centre of Standard Chartered Bank, various statistical tools have
been incorporated viz. time series analysis, growth rate, acceleration rate, regression analysis,
net present value analysis (NPV) and benefit-cost analysis on different variables covered in
this sector.
4.1 Trend Analysis of the Collected Amount
Chapter 4
Y = a + bt
Y = 483.3 + 87.9t
G = 11.68%
The collection unit of the Standard Chartered Bank deals with various categories and
segments of loans. As the part of the financial analysis, the trend analysis was performed on
the basis of historical time series of the collected amount of the bank during the period from
2001-02 to 2005-06. The trend equation of collection from customers was:
(The calculation of trend equation was shown in the Appendix 4.2)
Where,
Y was the value of the amount collected
a was the constant. It was the estimated value of Y when t = 0
b was the trend/slope of the line
t selected time periods
Based on the calculation given in Appendix 4.2, the derived trend equation was:
The equation indicates during the period of 2001-02 to 2005-06 the collection from
customers increased at an average rate of $87.9 million per year. On the basis of the above
equation, the collection from the customers for the year 2006-07 will stand at $1,010.7
million.
4.2 Growth and Acceleration Analysis
The growth rate of the amount collected from the customers was also determined based on
the last five years that was from 2001-02 to 2005-06 years collection (Appendix 4.3). The
growth rates in the different years reveal that the amount collected by the bank fluctuated
from one year to another year. In every consecutive year, the rate of change was moving
toward different directions, which can not be treated as very satisfactory collection
performance. But the average growth rate during the period of 2001-02 to 2005-06 indicated
that the bank showed remarkable improvement in collection in the recent years. The impact
of this performance increased the overall collection growth rate for the last five years. Data
on collection showed that the growth rate was:
0
300
600
900
1200
1 2 3 4 5
Collection
A= 8.09%
(The calculation was shown in the Appendix 4.3)
The acceleration rate of the collection of SCB during the last five years helps to determine
what will be the collection of the bank in the near future if the banks collection progress in
the similar fashion. This is very important because this forecasting will allow the bank to
pinpoint the area where it needs to concentrate more for better collection performance. The
acceleration rate of collection during the above mentioned periods was:
(The calculation was shown in the Appendix 4.3)
Fig 4.1: Collection Trend
It may not be out of place to mention here that overall the amount collected from the
customers was increasing at a satisfactory rate and indicating its efficiency in operations. The
acceleration rate of the collection of the bank was also indicative of the positive trend in the
future growth rates. The high value of the acceleration rate demonstrated enhancements in
banks capacity to recover the dues from the customers at an increasing rate in the years to
come.
4.3 Regression Analysis: Determinants of Collection Costs
Conventionally it may be said that the collection cost incurred by the Collection Centre of
Standard Chartered Bank in Bangladesh in the collection and relevant processes, depends on
the operational efficiency of the Centre. But as opposed to conventional thinking, it can be
justified that collection and recovery cost of the bank depends on a number of both internal
and external factors.
Y = a + b
1
X
1
+ b
2
X
2
+ b
3
X
3
Y = 183.707 0.864X
1
+ 6.795 X
2
1.086 X
3
Here, some internal factors were considered for analyzing the determinants of the collection
costs of the SCB Collection Centre. Regression analysis is a statistical tool with the help of
which one can estimate the unknown value of one variable from known value of another
variable. It measures the relationship in absolute term. Multiple regression analysis was done
to analyze the relationship between total collection cost as dependent variable and collection
cost for secured, unsecured products and number of Collectors as independent variables. In
the report, it was assumed that the relationship among the variables was linear as:
(The calculation of regression equation was shown in the Appendix 4.4)
Where,
Y was the value of dependent variable total collection cost
a was the value of constant
X
1
was the value of independent variable collection cost for unsecured products
X
2
was the value of independent variable collection cost for secured products
X
3
was the value of

independent variable number of Collectors
b
1,
b
2,
b
3
were the regression coefficients
Based on the data provided in Appendix 4.4, the values of the coefficient and constants were
calculated. Correlation coefficients were also calculated to estimate the relationship among
the variables. The estimated regression model for the variables was:
Linear equation shows:
b
1
= -0.864 which indicates if the cost of collection from unsecured products increases by
BDT 1 thousand, then total cost of collection decreases by BDT 0.864 thousand provided
the other independent variables remain unchanged.
b
2
= 6.795 which indicates if the cost of collection from secured products increases by
BDT 1 thousand, then total cost of collection increases for BDT 6.795 thousand provided
the other independent variables remain unchanged.
b
3
= -1.086 which indicates if the number of Collectors increases by 1 thousand, then total
cost of collection decreases for BDT 1.086 thousand provided the other independent
variables remain unchanged.
R = 0.991 indicates that there exist a very high degree of positive relationship among
variables.
R
2
= 0.981 indicates that 98% of the variations in the total collection costs can be
explained by the combined variations of unsecured product cost, secured product costs
and number of Collectors. Therefore, the independent variables collectively play an
important role on total collection cost.
From the ANOVA table (shown in Appendix 4.4), it can be concluded that the results were
statistically significant at the 5% level, as the significance level indicated in the ANOVA
table was 0.001 or 0.1%, which was less than 0.05 or 5% level.
As indicated by the t-statistics (from the Coefficients table shown in Appendix 4.4) it can be
concluded:
b
1
(unsecured products collection cost coefficient) was statistically significant because it
was significant at 0.047 or 4.7% level which was less than 0.05 or 5% level.
b
2
(secured products collection cost coefficient) was statistically significant because it
was significant at 0.008 or 0.8% level which was less than 0.05 or 5% level.
b
3
(number of Collectors coefficient) was statistically significant because it was
significant at 0.000 or 0% level which was less than 0.05 or 5% level.
The betas of the independent variables represent the degree of the influence of the
independent variables on the dependent variables. From the coefficient table (shown in
Appendix 4.4), the following facts were pointed out,
unsecured cost
= -0.702
secured cost
= 0.281
number of Collectors
= -1.172
As beta for number of Collectors was highest than the betas of unsecured and secured
products cost, number of Collectors exerts more influence on total collection costs.
Multicolinearity exists when correlation coefficient between the independent variables may
be higher than the coefficient between dependent and any other independent variables or
when correlation coefficient between the independent variable is greater than 0.8. According
to the Pearson correlation,
r
unsecured cost, secured cost
= 0.184
r
unsecured cost, number of Collectors
= -0.173
r
secured cost, number of Collectors
= -0.159
Here, it can be firmly concluded that the problem of multicolineraity does not exist because
correlation coefficient between the independent variables are not greater than 0.8 or 80% and
lower than the coefficient with dependent variable.
4.4 Cross Sectional Analysis on Different Banking Products
This project paper is prepared based on the information collected during the internship period
January, February and March, 2007 at the Collection Centre of Standard Chartered Bank in
Bangladesh. The collection picture of the bank during the period has been analyzed and
justified by using Cross Sectional Analysis (Appendix 4.5), which rpresents comparative
performance in a specific time frame. This analysis includes the banking products: Personal
Loan, Flexi Loan, Business Installment Loan and Auto Loan. Here, the analysis of the
credit card is not represented.
Personal Loan
Month January
The information of collection in the Appendix 4.5 for the month January represents the
collection performance of personal loan in that month. The figure 4.2 represents the deviation
between the targeted and actual amount of collection in different DPDs. The deviation is
relatively high in the 120 bucket. Whereas the 0 bucket and interim show relatively better
performance indicating relatively effective and sincere effort from the Collectors of the X
DPD. The Collectors of 30 DPD and 60 DPD show better performance than the Collectors of
90 and 120 DPDs. This observation will be more clarified if the ratio of achieved amount and
targeted for each bucket is determined.
0.00
2,000,000.00
4,000,000.00
6,000,000.00
8,000,000.00
Interim X DPD 30 DPD 60 DPD 90 DPD 120
DPD
Actual target Achievement
0
400
800
1200
1600
2000
DPD
Actual Target Achievement
Fig 4.2: Comparison between Target and Achievement
The ratios of the collected amount to targeted amount are as follows:
Interim (Tk) = 6,175,346.17 / 7,707,107.50 = 0.801253411
X DPD (Tk) = 2826134.96 / 3743984.79 = 0.754846806
30 DPD (Tk) = 1567853.53 / 3114935.28 = 0.503334223
60 DPD (Tk) = 930968.14 / 2305543.59 = 0.403795506
90 DPD (Tk) = 127839.6 / 345853.47 = 0.369635152
120 DPD (Tk) = 250203.84 / 1021762.52 = 0.244874748
Here, the higher the ratio, the better the performance.
In addition to this situation, if a comparison is drawn between the number of actual accounts
handled and the number of the accounts from which payments are collected then this situation
will be better understood. The number of accounts is declining as the accounts move to the
higher buckets, whereas the 90 bucket shows higher efficiency in terms of the number of
accounts as only 4 accounts remains to be unpaid in the month January. But its deviation
from the targeted collected amount is BDT 218,013.7. That is on an average per account
uncollected amount for 90 DPD is BDT 54,503.4675; whereas per account collection for this
DPD is BDT 15,979.95.
0.00
2,000,000.00
4,000,000.00
6,000,000.00
Interim X DPD 30 DPD 60 DPD 90 DPD 120 DPD
0
200
400
600
800

Fig 4.3: Accounts Condition for Different Buckets
Month February
This figure 4.4 is developed based on the information of the collected and targeted amount
represented in the appendix 4.5. Here, excellent collection efficiency is derived in the 30
DPD as the Collector dealing with the 30 DPD has not only fulfilled his target but also
collected more than his target. The deviation between target and achievement is much higher
for 60 DPD which is BDT 625, 25.48. Still that, the performance of 60 DPD improves in this
month which is revealed by the performance ratio of the Collector.

Interim (Tk) = 4,818,193.56 / 5,578,062.08 = 0.863775535
X DPD (Tk) = 3,537,868.60 / 4,521,208.25 = 0.782505119
30 DPD (Tk) = 1351049.44 / 1325923.45 = 1.018949804
60 DPD (Tk) = 1,081,156.41 / 2,169,534.50 = 0.498335661
90 DPD (Tk) =226,512.53 / 851,538.01 = 0.266004015
120 DPD (Tk) =55,500.06 / 259,510.06 = 0.213864773
0.00
2,000,000.00
4,000,000.00
6,000,000.00
If the accounts condition is analyzed, it is revealed that the Collector of 120 DPD shows
efficiency in collecting payment from 5 accounts out of targeted 8 accounts. But the ratio of
performance is not satisfactory as the deviation from the target in this DPD is BDT 24,010.
This deviation indicates the accounts from which payment can not be collected are high
enough to generate this high deviation. Again, in the 30 DPD, 35 accounts remain to be
unpaid though the collected amount from this DPD is still high than the target. This indicates
the accounts from which payments are collected made higher than the required payment.
Here, though the Collector of 30 DPD has collected amount higher than the required amount,
he is required to be conscious of his accounts condition as the accounts that have not been
paid will move to higher bucket.

Month March
The month March seems to be favorable for the Collectors dealing with X DPD as their
collected amount is very close to their targeted amount. The collection generated at the 30
DPD falls in the month. The Collector fails to fulfill the target and faces a deviation of BDT
1,639,885.24. The accounts condition of the Interim is not satisfactory though its ratio is not
high enough. The Collectors of interim are succeeded in collecting payments from 458
accounts out of 553 accounts. The deviation from the target in this DPD is 95 accounts.
Interim (Tk) = 4,341,571.32 / 5,606,202.98 = 0.774422784
0
200
400
600
800
0%
20%
40%
60%
80%
100%
January February March
120 DPD 90 DPD 60 DPD 30 DPD X DPD Interim
X DPD (Tk) = 4,615,456.25 / 5,663,546.37 = 0.814941019
30 DPD (Tk) = 2,127,245.56 / 3,767,130.80 = 0.564685877
60 DPD (Tk) =1,090,690.54 / 2,305,156.73 = 0.473152444
90 DPD (Tk) = 273,845.26 / 812,002.76 = 0.337246711
120 DPD (Tk) =113,050.73 / 486,474.00 = 0.232388021

Summary of Performance
Interim collection increases in February and falls in March.
Performance of X DPD improves continuously.
Performance of 30 DPD increases by higher degree in February, but
falls in March.
60 DPD shows slight fluctuations in performance.
Collection in 90 DPD falls in February, but recovers in March.
Collection in 120 DPD also falls in February, but recovers in March.
Fig 4.8: Comparative Performance
0
100
200
300
0.00
4,000,000.00
8,000,000.00
12,000,000.00
DPD
Flexi Loan
Month January
The appendix 4.5 represents the information of targeted and actual collected amount of
payments from the customers for flexi loan. The graphical representation of the information
(Fig: 4.9) reveals an interesting condition of collection in the 120 DPD. The targeted amount
at this DPD is BDT 65,559.78, but the Collector of 120 DPD fails to collect any amount from
the clients of the SCB. At the same time, the Collector of the 90 DPD shows tremendous
success as his collected amount from the customers is higher than the targeted amount.
Besides, the Collectors of interim and X DPD also show satisfactory performance, but the
Collectors of the 30 DPD and 60 DPD are demanded more attention as their deviations from
the targeted amount are still high. Besides, the Collector of 90 DPD collects payment from 5
accounts out of targeted 9 accounts and his per account payment is BDT 164,846.454.
Interim (Tk) = 7,319,563.39 / 8,485,570.24 = 0.862589453
X DPD (Tk) = 4,937,697.14 / 5,663,473.22 = 0.871849649
30 DPD (Tk) = 1,347,672.69 /1,972,038.42 = 0.683390687
60 DPD (Tk) = 824,232.27 / 1,346,391.82 = 0.612178608
90 DPD (Tk) = 824,232.27 / 555,443.23 = 1.483918113
120 DPD (Tk) = 0 / 65,559.78 = 0
0.00
2,000,000.00
4,000,000.00
6,000,000.00
8,000,000.00
DPD
Month February
In the month February, the Collector of the flexi loan in the 120 DPD shows better
performance as he becomes able to collect payment from the 2 accounts out of 3 targeted
accounts. His collected amount of payment is BDT 132,816.04.
Interim (Tk) = 6,466,861.99 / 7,846,321.30 = 0.824190311
X DPD (Tk) = 4,130,482.55 / 4,950,411.49 = 0.834371558
30 DPD (Tk) = 1764025.36 / 2,566,903.97 = 0.68721907
60 DPD (Tk) =292,519.29 / 555,756.92 = 0.526343945
90 DPD (Tk) = 336,910.25 / 626,878.80 = 0.53744081
120 DPD (Tk) = 132,816.04 / 318,336.99 = 0.41721837
The ratios reveal that the Collectors of the interim and X DPD show better performance as
the ratios of the collected amount to the targeted amount of this two DPDs are higher than the
other DPDs, whereas the performance of the Collector of the 30 DPD falls in the month
February. If the performance is analyzed from the perspective of the number of accounts, it is
found that the Collector of the 60 DPD shows success in collecting payments from 11
0.00
2,000,000.00
4,000,000.00
6,000,000.00
8,000,000.00
DPD
0
100
200
300
accounts out of his targeted 13 accounts. But his collected amount maintains deviation from
the targeted amount by BDT 263,237.63; that is per account of uncollected amount is BDT
131618.815 and per account collected amount is BDT 26,592.66. This situation indicates that
though the Collector has collected payment form the most of the accounts, the accounts
remained to be uncollected are large enough to decrease the ratio and increase the deviation
of the collected amount form the targeted amount.
Month March
In the month March, the Collector of the 120 DPD fails to collect any payment from his
customers. On the other hand, the Collector of the X DPD shows better performance and with
her sincere effort she is able to collect most of her targeted amount. The payment collected at
the 90 DPD is not satisfactory in the month as the Collector generates a deviation of BDT
75,680.49. Here, at 90 DPD, the Collector is succeeded in collecting payments from all the
accounts, still that in terms of his payment condition, the performance is not better and his
performance ratio is 0.47834077 which is much lower than the performance ratio of X DPD
that is 0.926132115.
0%
20%
40%
60%
80%
100%
0
100
200
300
The ratios of the collected amount to targeted amount are as follow:
Interim (Tk) = 5,420,101.10 / 6,836,669.68 = 0.792798446
X DPD (Tk) = 5,021,686.78 / 5,422,214.28 = 0.926132115
30 DPD (Tk) = 1,956,013.71 / 2,662,774.92 = 0.734577187
60 DPD (Tk) = 565,780.72 / 1,090,645.78 = 0.518757538
90 DPD (Tk) = 69,396.00 / 145,076.49 = 0.47834077
120 DPD (Tk) = 0 / 193,665.68 = 0

Collection at interim is continuously falling.
Collection at X DPD falls in February, but increases degree in March.
Collection at 30 DPD improves over the three months but Collection at
60 DPD falls continuously.
Performance of 90 DPD is excellent in the month January, but then
falls.
Collector of 120 DPD is only successful in colleting payment in
February.
0.00
5,000,000.00
10,000,000.00
15,000,000.00
20,000,000.00
DPD
Business Installment Loan
Month January
The performance of the Collectors of business installment loan is not satisfactory in the
month January. With the view to clarify this evaluation, the ratios of the collected amount to
the targeted amount are to be analyzed. The Collectors in the interim and X DPD show
relatively better performance and the Collector of the 90 DPD fails to collect the majority
portion of his targeted amount. The deviation from the targeted amount for the Collector of
90 DPD is BDT 4,156,244.50. On the other hand, the Collector of 120 DPD shows efficiency
in collecting payment from the 2 accounts out of his targeted 2 accounts. But his deviation
from the targeted collection is still high (BDT 469,073.35) which reduces his performance
ratio to 0.40474794.
Interim (Tk) = 10,343,261.42 / 15,361,403.28 = 0.673327901
X DPD (Tk) = 4,375,182.16 / 6,764,128.52 = 0.646821264
30 DPD (Tk) = 2,360,321.12 / 5,336,922.90 = 0.442262548
60 DPD (Tk) = 637,199.00 / 4,521,043.98 = 0.140940677
90 DPD (Tk) = 344,561.73 / 4,500,806.23 = 0.076555557
120 DPD (Tk) = 318,951.39 / 788,024.74 = 0.40474794
0.00
2,000,000.00
4,000,000.00
6,000,000.00
8,000,000.00
X DPD - 76%, 30 DPD 26%, 60 DPD -28%
90 DPD 16%, 120 DPD 9%
0
50
100
150
200
According to the performance information of BIL maintained by the Collection Centre of
Standard Chartered Bank, in the month January the achievements of the DPDs are:
Month February
The month February is much better for the Collectors of interim and X DPD of BIL. More
clearly in this month, all the Collectors except the Collector dealing with 120 DPD improve
their performance. The comparison between the ratios of the month January and February
clarifies the improvement in performance properly. The Collector of 120 DPD collects
payment from 4 accounts out of 5 accounts though the performance ratio of the Collector
falls in the month. His deviation from the target is BDT 1,445,890.08. This deviation is much
higher than the deviation from target in the month January (deviation in the month January at
the 120 DPD is BDT 469,073.35). Besides, the performance ratios for both the 60 DPD and
90 DPD improve in this month. For the 60 DPD the performance ratio increases by 16% and
for 90 DPD the ratio improves by 25%.
0.00
2,000,000.00
4,000,000.00
6,000,000.00
8,000,000.00
10,000,000.00
DPD
0
50
100
150
X DPD - 76%, 30 DPD 60%, 60 DPD -32%
90 DPD 18%, 120 DPD 26%
Interim (Tk) = 5,178,608.89 / 6,068,608.54 = 0.853343704
X DPD (Tk) = 5,793,677.99 / 7,886,233.29 = 0.73465719
30 DPD (Tk) = 2,234,623.31 / 3,373,749.09 = 0.662356106
60 DPD (Tk) = 1,268,785.53 / 4,137,251.14 = 0.306673559
90 DPD (Tk) = 821,197.10 / 2,517,918.54 = 0.32614125
120 DPD (Tk) = 508,899.68 / 1,954,789.76 = 0.260334738
According to the performance information of BIL maintained by the Collection Centre of
Standard Chartered Bank, in the month February the achievements of the DPDs are:
Month March
0
50
100
150
DPD
X DPD - 82%, 30 DPD 53%, 60 DPD -34%
90 DPD 16%, 120 DPD 12%
Similar to the performance in the month February, the Collectors of the interim and X DPD
show more efficiency in collection. The deviations from the targeted amount of collection in
these DPDs are BDT 1,180,171.52 for interim and BDT 1,342,226.1 for X DPD. But the
month is not favorable for the Collector of 90 DPD. At this DPD, the deviation is much
higher, that is BDT 297,660.32. As the part of this analysis, if the accounts condition is
analyzed, it is revealed that the Collector of 60 DPD shows more efficiency in collecting
payments from all the accounts except 2. Similarly, the Collector of 120 DPD leaves only 3
accounts as uncollected. Since that the performance ratios of these two Collectors are low
because of higher deviation form the targeted collection amount.
Interim (Tk) = 6,495,933.01 / 7,676,104.53 = 0.84625385
X DPD (Tk) = 6,937,466.97 / 8,279,692.47 = 0.83788945
30 DPD (Tk) = 2,210,153.89 / 4,134,500.07 = 0.534563757
60 DPD (Tk) = 808,853.80 / 2,346,424.46 = 0.344717596
90 DPD (Tk) = 613,803.73 / 3,590,406.93 = 0.170956591
120 DPD (Tk) = 505,871.54 / 4,085,115.95 = 0.123832847
According to the performance information of business installment loan maintained by the
Collection Centre of Standard Chartered Bank, in the month March the achievements of the
DPDs are-
0.00
2,000,000.00
4,000,000.00
6,000,000.00
Interim X DPD 30 DPD 60 DPD
0%
20%
40%
60%
80%
100%
Collection at interim and X DPD are relatively stable in the month
February and March
Collection at 30 and 60 DPDs improve in February.
Collection at 90 DPD improves remarkably in February, but declines in
March, but collection at 120 DPD declines over the month March.
Auto Loan
Month January
In the analysis of the performance of auto loan, the 120 DPD has not been considered as it
has already been informed that the provision bucket for this loan is 120 DPD. From the
graphical representation, it can be clarified that the Collector of X DPD shows excellent
performance in collection in the month January and almost 80% (approximately) of the target
is achieved in terms of the targeted amount. Besides, the Collector of 30 DPD is also
succeeded in fulfilling his 60% (approximately) targeted collection amount. On the other
hand, the Collectors of interim and 120 DPD fails to collect their desired level of amount
form the customers.
X DPD - 83%, 30 DPD 43%,
60 DPD -44%
0
50
100
150
200
250
The Collector of 60 DPD shows efficiency in collecting payment form 12 accounts out of his
targeted 16 accounts. But because of the accounts that remain to be uncollected, the deviation
from the targeted amount becomes BDT 12,005,614.76; that is per account uncollected
amount is BDT 3,001,403.69. And per account collection is BDT 44,136.12333. Here, per
account deviation is BDT 2,957,267.567. Besides the collected amount condition, the account
condition of the interim is also not satisfactory as payment is collected only form 96 accounts
out of 202 accounts.
Interim (Tk) = 2,466,042.14 / 5,392,733.69 = 0.457289805
X DPD (Tk) = 4,540,131.06 / 5,459,906.24 = 0.831540115
30 DPD (Tk) = 1,868,865.95 / 2,934,107.93 = 0.636945196
60 DPD (Tk) = 529,633.48 / 1,735,248.24 = 0.305220583
90 DPD (Tk) = 613,803.73 / 3,590,406.93 = 0.170956591
120 DPD (Tk) = 505,871.54 / 4,085,115.95 = 0.123832847
According to the performance information of auto loan maintained by the Collection Centre
of Standard Chartered Bank, in the month January the achievements of the DPDs are-
0
50
100
150
200
250
0.00
2,000,000.00
4,000,000.00
6,000,000.00
Month February
The Collector of auto loan in the X DPD continues to show better performance in the month
February. At the same time, the Collector of interim improves the performance and achieved
61% of his targeted amount. But the performance ratio of the Collector of 90 DPD falls in the
month. From the perspective of accounts condition, the Collector of 60 DPD proves his
efficiency in collecting payments from 19 accounts out of his targeted 19 accounts. Still his
deviation from the targeted amount is BDT 1,131,923.45; that is the Collector fails to collect
the required amount of payment from the customers and each customer on an average
maintains a deviation of BDT 59574.91842.
Interim (Tk) = 2,542,656.43 / 4,187,611.57 = 0.607185358
X DPD (Tk) = 4,401,943.88 / 5,109,056.65 = 0.861596217
30 DPD (Tk) = 1,191,495.36 / 2,349,581.19 = 0.507109678
60 DPD (Tk) = 996,728.32 / 2,128,651.77 = 0.468243953
X DPD - 86%, 30 DPD 51%,
60 DPD -47%
0.00
2,000,000.00
4,000,000.00
6,000,000.00
0
50
100
150
200
250
of Standard Chartered Bank, in the month February the achievements of the DPDs are-
Month March
The overall performance of the Collectors in the month march for auto loan is improved. The
Collector of X DPD maintains better performance. Besides, the Collectors of interim, 60
DPD improve their performance and reduce the deviation from the targeted amount to be
collected from the customers. The Collector at the 30 DPD maintains stability in collection.
But he shows efficiency in terms of the number of accounts from is payment is collected. He
leaves only 8 accounts as uncollected condition. The Collector of 120 DPD is highly
successful in collecting payment from the 23 accounts out of his targeted 24 accounts.
X DPD - 87%, 30 DPD 51%, 60 DPD -52%
0%
20%
40%
60%
80%
100%
60 DPD 30 DPD X DPD Interim
Interim (Tk) = 2,991,850.83 / 4,626,595.08= 0.646663643
X DPD (Tk) = 5,015,528.63 / 5,751,966.29= 0.871967668
30 DPD (Tk) = 1,221,517.84 / 2,417,007.31= 0.505384421
60 DPD (Tk) = 1,183,894.70 / 2,292,137.66= 0.516502443
of Standard Chartered Bank, in the month March the achievements of the DPDs are:
Collection at interim improves over the month February and March.
Collection at X DPD also improves over the month February and March.
Collection at 30 DPD declines in February and then remains stable.
Collection at 60 DPD improves in the month February and March.
4.5 Regression Analysis: Recovery and Cost of Commission
The recovery team of the Collection Centre of Standard Chartered Bank is showing its
efficiency in collecting the required payments from the customers in the last several years.
The team has set up its target recovery for 2007. The target includes increasing recovery from
BDT 21.88 million to 43.00 million for credit cards and from BDT 35.6 million to BDT
Y = a + bX
Y = 511953.039 + 4.383 X
40.00 million for banking products. The team also emphasizes on the cost efficient recovery
in the year 2007. With the view to achieving this target, the SCB recovery team has identified
some challenges, which are:
Political condition
Extensive monitoring of portfolio and commission structure for the Members
Better capacity management and requirements of recovery Members, etc.
As the recovery team plays a vital role in the collection performance of the Standard
Chartered Bank in Bangladesh, the determinants of the recovery are analyzed. Out of these
internal and external vital factors influencing the recovery performance, one factor-
commission cost is considered in the regression analysis performed for identifying its
significance on the amount of recovery. The analysis justified the sensitivity of the recovery
amounts to the factor.
With the view to identifying the relationship between the amount of recovery of the
Collection Centre and cost of commission, simple regression analysis was done considering
recovery as dependent variable and commission cost for recovery as independent variable. In
the report, it was assumed that the relationship between the variables was linear as:
(The calculation of the regression equation was shown in Appendix 4.6)
Where,
Y was the value of dependent variable recovery amount
a was the value of constant
X

was the value of independent variable commission cost against recovery
b was the regression coefficients
Based on the data provided in Appendix 4.6, the values of the coefficient and constants were
calculated. The estimated regression model for the variables was:
Linear equation shows that if the cost of commission increases by BDT 1, then recovery
increases by BDT 4.383, which was logical. From the ANOVA table (shown in Appendix
4.6), it can be concluded that the results were statistically significant at the 1% level, as the
significance level indicated in the ANOVA table was 0.00 or 0%, which was less than 0.01 or
1% level.
As indicated by the t-statistics (from the Coefficients table shown in Appendix 4.6) it can be
concluded that b (commission cost coefficient) was statistically significant because it was
significant at 0.00 or 0% level which was less than 0.01 or 1% level.
The average recovery by the Standard Chartered Bank in Bangladesh for the period
January06 to September06 was BDT 1,288,045 and the average cost of commission of the
bank for the same time period was BDT 177,051. The standard deviation of the recovery for
the period was BDT 289,914 and that of cost of commission was BDT 65,523.
The Coefficient of Correlation between the recovery and commission cost of SCB was:
(The calculation was shown in Appendix 4.6)
The Coefficient of Correlation indicates that there was positive and high relationship between
the recovery of the bank in Bangladesh and its amount of commission cost (Appendix 4.6).
The strength of the relationship between the variables, measured by the coefficient of
determination (r
2
) was 0.981 (Appendix 4.6). The value indicates significantly high
relationship. More clearly, 98.1% (Appendix 4.6) of the variation in recovery can be
explained by the variations in the commission cost incurred by the bank.
4.6 Trend Analysis of the Recovery from Credit Card
As the part of analyzing the performance of the recovery team of SCB, the trend analysis was
performed. The trend equation, already explained at the beginning of this chapter was
developed for the recovery pool of the recovery team for credit card which was:
Y = -13920680.56+ 13793377t
r = + 0.991
(The calculation of trend Equation is shown in the Appendix -4.7)
The equation indicates during 2000-01 to 2005-06 the recovery pool for
credit card increased at an average rate of BDT 13,793,377 per year. On
the basis of above equation, the recovery pool of SCB in Bangladesh for
the year 2006-07 was forecasted at BDT 82,632,958.43 and projected
recovery by the Collection Centre was BDT 12,394,943.76 (@15% of the
recovery pool set by the management policy).
The recovery projections of the Collection Centre of SCB are as follows:
According to the banking record of SCB in Bangladesh, it is found that
projected recovery pool for credit card is BDT 87,340,306.00. It
maintains an excess of BDT 4,707,347.57 from the calculated
projection of BDT 82,632,958.43. The reason of this deviation reveals
form unexplained and secret management policy for recovery.
The management predicts in the year 2007, the recovery rate for
credit card will be 15% considering presence of incremental logistic
supports and adopted special planning and strategy taken by the
banks management in 2007 and so the projected recovery was BDT
13,101,045.90 for recovery pool BDT 87,340,306.00. The recovery
projected by the management maintains an excess of BDT 706,102.14
from the calculated projection of recovery at BDT 12,394,943.76.
The management was targeting 10% recovery of credit card payments
from the remaining pools.
Total non-paying account in 2006 was 1800 and paying account out of
the non-paying account in 2006 was 19%. The average payment
collected from the paying account in 2006 was BDT 9,856.28. The
management assumes that the number of non-paying accounts and
the proportion of paying account form the non-paying accounts will be
reflected in the year 2007. So predicted paying accounts from non-
paying pool in 2007 was 342 and payment from these account was
BDT 3,370,484.43 (Appendix 4.7).
PL
18%
Flexi
33%
BIL
36%
Auto
13%
PL Flexi BIL Auto
Recovery Target for Banking Products
The main objectives of the recovery team in respect to the banking
products are increasing the average monthly recovery for PL and BIL and
following up the non-paying accounts separately. Recovery target for
banking products is as follows:
Product PL Flexi BIL AUTO
Yearly 8,700,000.00 15,950,000.00 17,400,000.00 6,525,000.00
Monthly
725,000.00 1,329,166.66 1,450,000.00 543,750.00
Table: 4.1; Source: Recovery Records of the Collection Centre
Fig 4.30: Recovery Target in 2007 for Banking Products
The figure reveals that the targeted recovery was highest for BIL and lowest for auto loan,
because the BIL accounts moving to 150 DPD was very high in terms of amount and the
performance of the Collectors of auto loans prevents the accounts movement to recovery.
4.7 NPV and Benefit - Cost Analysis
Project 1: Regular Recovery Investment
In the recovery management policy, the bank incurs costs in form of remuneration to the
Members of recovery team, transportation cost and other administrative activities. In the year
2005-06, the overall cost of recovery was BDT 6,000,000.00 against which the generated
recovery was BDT 60,000,000.00. The net benefit was BDT 54,000,000.00. The benefit-cost
ratio was 0.10 or 10%.
NPV = BDT 69,090,909.09
Benefit-cost ratio = 9.4
NPV = BDT 2,727,272.72
Benefit-cost ratio = 6
The management proposes to incur total BDT 9,000,000.00 in the year 2007 for the regular
recovery team. The projected recovery that will be generated form this investment is
85,000,000.00. The time period for the project is 1 year. Discount rate proposed by the
management is 10%. The Appendix 4.8 shows the present value of the projected recovery at
10% discount rate was BDT 77,272,727.27 and that of recovery cost was BDT
8,181,818.182. The NPV and benefit-cost ratio of the project were:
As the NPV was positive and benefit-cost ratio was greater than 1 (one), investment for
recovery is acceptable. Based on the projection, growth rate of cost was 50% and that of
recovery was 41.67%. The growth rate of revenue income was 40.74%. Considering
discounted values of the recovery and cost, the growth rate of recovery was 28.79% and that
of cost was 36.36%.
Project 2: Agency Investment
The special recovery team deals only non-paying accounts. The team may hand over the non-
paying untraced accounts to agency for address collection purpose. In many cases, after
collecting addresses of the non-paying untraced accounts, recovery can be generated.
Management is expecting that 100 accounts per month out of the non-paying accounts will be
added to paying account pool through that initiative of collecting address by the agency.
Therefore, total 1200 accounts will be included in the paying pool in every year. Management
also predicts the cost that will be incurred for the address collection process is BDT 500.00
per account and total BDT 600,000.00. Per account predicted recovery is BDT 3000.00 and
total amount of recovery form the non-paying untraced accounts is BDT 3,600,000.00.
As the management is expected to generate recovery in the year 2007, the predicted amounts
were discounted for 1year in the Appendix 4.8. The discount rate was assumed at 10%.
Considering this, the present value of cost was BDT 545,454.55 and that of recovery was
BDT 3,272,727.27. The NPV and benefit-cost ratio were:
NPV = BDT 10,727.27
Benefit-cost ratio = 12.73
As the NPV was positive and benefit-cost ratio was greater than 1 (one), investment for
agency is acceptable.
Project 3: Legal Investment
Accounts are monitored by the in-house team and external recovery agency to recover the full
outstanding as early as possible. This combination of efforts is retained for a certain period of
time after which the Unit goes for legal actions against non-paying accounts if it deemed to
be cost-effective. The effort ends upon recovering the amount through settlement or litigation
and finally writing off the account.
Thus, when the accounts condition moves to higher buckets and the collection of payment
becomes difficult, the Collection Unit takes legal action. In this segment, the application of
legal unit becomes necessary. Action plans for higher level performance from litigation
includes focusing on litigation as a tool of recovery, maintaining liaison with police stations
to implement the judgment of the court, arranging adequate resource to manage the legal
cases and finally maintaining liaison with Govt. agencies to implement the money suit
execution. All of these activities require adequate funds. In order to achieve the target of
collection and recovery in 2007, the management has developed a proposal for the legal unit.
Here, the benefit-cost analysis of the proposal was analyzed.
Management predicts cost of legal action will be BDT 1,100.00 and generated recovery will
be BDT 14,000.00. The trade-off is BDT 12,900.00. The benefit-cost ratio is 12.73. For the
purpose of calculating discounted amount, the discount rate was assumed at 10%. From
Appendix 4.8, it was found that the discounted value of legal cost at 10% rate for 1 year was
BDT 1000.00. The discounted value for recovery was BDT 11,727.27. The NPV and benefit
cost ratio were:
As the NPV is positive and benefit-cost ratio is greater than 1 (one), investment for agency is
acceptable.
4.9 Capacity Planning in the Collection Centre
As per management policy, the Collection Centre of Standard Chartered Bank develops
capacity plan. This is the plan that assists to manage collection resources according to
business strategy, ensure optimum utilization of resource and finally enable recruitment in
advance. A capacity plan for collections is in place based on the forecasted collection flow
rates and number and volume of accounts. The plan has been developed by taking
consideration of call intensity per account by a Collector with the availability of the existing
logistic support like telephone lines, PCs and others.
The capacity plan for personal loan for the month March, 2007 was
prepared by using the data of the month January and February (Appendix
-4.9) following the steps sequentially included below:
The figures for the number of accounts and amount for the accounts in
each bucket were given by the management. The number of required
calls for each account was determined based on the months January
and February.
Total number of required calls was determined by multiplying the
number of required calls per account and the number of accounts.
Calls per day of a Collector were determined based on the data of
January and February.
The number of days for the month March was collected from the
management.
Total call capacity was determined by multiplying the number of days
and calls per Collector per day.
Required number of Collectors is determined by dividing the total calls
required by total call capacity. Actual capacity was determined based
on the data of January and February.
Gap between the required number of Collectors and actual number of
Collectors was determined.
Thus the management estimates Collector requirement based on the
number of working days in the month, factoring in capacity loss due to
planned and unplanned leave, training and staff turn-over. The capacity
plan prepared for the month March revealed that 2 (Two) additional
Collectors are required for the personal loan team.
Findings of the Study
After Liberation War in Bangladesh, the leading multinational bank Standard Chartered
Bank created an example by assisting to open first LC for Bangladesh. After 36 (thirty six)
years, the bank has created another example by separating its Collection Division form
ordinary banking activities. This chapter represents the major findings of the study as the
output of practical experience of working in the Collection Centre and statistical analysis of
the collected information while analyzing the overall activities of the Collection Centre:
The major manpower of the Collection Centre is the Collectors. In the beginning of the
month they are assigned accounts based on the buckets that they deal. In case of the death
of any account holders, the account is deducted form their lists. They are given one month
time for collecting due amount form the assigned accounts.
Collectors serve as mainly Tale-Collectors. While conversation with customers, they are
to ensure that the collection module is up to date, prohibiting any accounts to flow
through from one bucket to another without action and are also responsive to Customer
Service Staffs. The collection strategies, applied by them vary depending on the condition
of the accounts, number of unpaid installments, and customer priority ratings. Some
strategies are mandated and some are specific for secured products, like auto loan, flexi
loan, etc.
The Centre has its own cost management policy. The management of the Centre is
responsible for reducing delinquency rate at the minimum costs. Management is also
conscious of database management system and security of the system. The cheques being
dishonored from the banks come to the Collection Centre which are again placed by the
Collectors after the negotiation with the customers. The store management of cheques is
also a critical issue for the Collection Centre.
The Collectors are shifted from one team to another team based on their performance.
Collectors performance that depends on KPI, hourly productivity and punctuality. The
Collectors are contractual employees. Their remuneration varies based on their
performance. Besides, the management offers commissions and awards for the Collectors
and Team Leaders based on their performance, which motivate to improve their
performance.
Different types of workshops and training are arranged for the Members of the Collection
Centre for improving their efficiency in making calls, handling customer resistance, etc.
They are also trained on the security system SAFE (Security Awareness for Employees)
and also on money laundering prevention. They are to attend online exams on these.
Attaining 80% marks in the exams ensure certificates for them.
The Centre recruits external agencies for the collection purposes. The agency may be
involved in any stage of the accounts. When the Collectors fail to collect payment, they
may exercise the opportunity to collect payment through agencies. The legal unit deals
with legal activities when the loans are classified and moves to legal action.
The Centre uses customized softwares that assist the Members of the Collection Centre in
keeping track of customers dealings, their contract numbers, payment condition,
evaluating the Collectors performance and customer dealing quality. It uses Client server
architecture and provides well furnished infrastructure for its Members.
Though the management of the Centre arranges different types of remuneration for the
Members to retain them, the switching tendency among the Members of the Collection is
still high. The main reasons of their dissatisfaction are Collectors are not employed
directly by the HR of the bank. They are to attend office on Saturday. The pressure of
work at the end of the month and strict leaving rules also dissatisfy them.
The collection performance of the bank based on its last five years experience proves that
the overall collection grows positively. Besides, the growth rate and acceleration rate of
the collection of SCB in the last five years shows efficiency of the bank in collection. The
management is going to make investment in some projects that will add value to the
Centre.
Management predicts 15% recovery form credit card collection pool. The highest
proportion of the recovery target in 2007 for banking products (BP) includes BIL and the
lowest portion complies with auto loan. Collectors at the higher buckets in some cases are
succeeded in regularizing accounts, but the performance is not good in terms of collected
amount.
The major determinants of the collection cost are number of Collectors and costs incurred
for secured and unsecured products. The number of Collector and cost of unsecured
products reduce the total collection costs. Amount of recovery is positively related to
commission cost and maintains high degree of positive relationship.
The management in every month develops capacity plan to analyze the requirements of
new members for the Centre. It assists the management to continue its collection flow
properly; whereas if the gap of the required Members are identified, it will hamper the
work flow of the Centre, again excess employees will result in excess cost for it. A
capacity plan developed for personal loan in month March, 2007 reveals the need for
requirement of 2 new Members.
The major findings highlighted above disclose the efficiency of the management in selecting
projects, setting goals and strategies, managing manpower, arranging training and
remuneration which ultimately contribute to the banks achievement of goals and maintaining
the flow of funds. But an alarming issue for the management is switching tendency among
the Collection Members. Image, salary structure can attract the collectors to it, but cant
retain them. In order to keep pace with the competitive banking world, the Collection Centre
needs to emphasize on the issue Retention of its experienced and efficient Members,
which will add speed to its success of collection and recovery and facilitate in meeting future
challenges and finally will create an opportunity for the bank to progress well in collection of
disbursed loans.
Conclusion
Banking sector is considered as the barometer of economic condition of any country. It has
significant contribution towards the economic development of the country. The banking
sector of Bangladesh provides an interesting study regarding the effect of various company
specific and macroeconomic variables on the loan disbursement, default and recovery of
loans. The issue of loan default, recovery and banking sector performance in Bangladesh
continues to be a perennial source of discussion among academicians, policy makers and
practitioners.
The foreign banks including Standard Chartered Bank, operating in Bangladesh show better
efficiency in overcoming the serious problem-loan default that arises from the loan
disbursements which is the main banking activity. An Integrated Inter-Bank Electronic
Transaction System (IIBETS) maintained by the foreign banks assists in this case. Because,
the Integrated Inter-Bank Electronic Transaction System is designed whereby all revenue
generated by defaulting companies and default customers would end up in a particular loan
accounts while withdrawal of funds from any other operating accounts of the companies or
customers will be automatically prevented, unless and until the designated amount have been
deposited in the respective loan accounts.
The SCBs credit approval moves through clear and sequential phases. Still, some accounts
become delinquents in every month as the borrowers fail to pay regularly. In order to
accelerate the banks performance, the bank has successfully developed a separated
Collection Unit with a small manpower where peoples main duty is to collect the payments
form the customers. The technology of the SCB Collection Centre assists the bank in a long
way to undermine the default culture among its clients.
The previous discussion reveals that the Collection Center of the Standard Chartered Bank is
highly dependent on its MIS. Collection MIS is the key to collection productivity monitoring,
collection strategy setting and daily collection management and serves as collection
productivity indicators by product, by functional area and by Collectors. It assists in
monitoring calls per hour, contact rates and promise taken to contact ratio. Based on that,
kept promise ratio and success rate are determined. Collection MIS plays a vital role in
collection inventory tracking and monitoring as well as comparing current payment flow with
the past payment flow. The trends, over limit and delinquent account trend of the customer
who due their first installment (FID customers) is also determined by MIS.
Technology is faceless and no amount of lobbying can influence the outcome of the software
program designed to assist collection activities. Through calls, sms and visit, the
communication with the customers is maintained. This change in the banking sector is
showing the bright future of reducing the non performing loans (NPL) and setting examples
for the other banks which have not still separated Collection Division and thus leading the
battle Developing loan default free culture in Bangladesh.
Conclusion
Banking sector is considered as the barometer of economic condition of any country. It has
significant contribution towards the economic development of the country. The banking
sector of Bangladesh provides an interesting study regarding the effect of various company
specific and macroeconomic variables on the loan disbursement, default and recovery of
loans. The issue of loan default, recovery and banking sector performance in Bangladesh
continues to be a perennial source of discussion among academicians, policy makers and
practitioners.
The foreign banks including Standard Chartered Bank, operating in Bangladesh show better
efficiency in overcoming the serious problem-loan default that arises from the loan
disbursements which is the main banking activity. An Integrated Inter-Bank Electronic
Transaction System (IIBETS) maintained by the foreign banks assists in this case. Because,
the Integrated Inter-Bank Electronic Transaction System is designed whereby all revenue
generated by defaulting companies and default customers would end up in a particular loan
accounts while withdrawal of funds from any other operating accounts of the companies or
customers will be automatically prevented, unless and until the designated amount have been
deposited in the respective loan accounts.
The SCBs credit approval moves through clear and sequential phases. Still, some accounts
become delinquents in every month as the borrowers fail to pay regularly. In order to
accelerate the banks performance, the bank has successfully developed a separated
Collection Unit with a small manpower where peoples main duty is to collect the payments
form the customers. The technology of the SCB Collection Centre assists the bank in a long
way to undermine the default culture among its clients.
The previous discussion reveals that the Collection Center of the Standard Chartered Bank is
highly dependent on its MIS. Collection MIS is the key to collection productivity monitoring,
collection strategy setting and daily collection management and serves as collection
productivity indicators by product, by functional area and by Collectors. It assists in
monitoring calls per hour, contact rates and promise taken to contact ratio. Based on that,
kept promise ratio and success rate are determined. Collection MIS plays a vital role in
collection inventory tracking and monitoring as well as comparing current payment flow with
the past payment flow. The trends, over limit and delinquent account trend of the customer
who due their first installment (FID customers) is also determined by MIS.
Technology is faceless and no amount of lobbying can influence the outcome of the software
program designed to assist collection activities. Through calls, sms and visit, the
communication with the customers is maintained. This change in the banking sector is
showing the bright future of reducing the non performing loans (NPL) and setting examples
for the other banks which have not still separated Collection Division and thus leading the
battle Developing loan default free culture in Bangladesh.
Amandeep, (1993), Profit and Profitability in Commercial Banks. New Delhi: Deep &
Deep Publication
Siddique, S. R and Islam, A.F.M.M, Banking Sector in Bangladesh: Its Contribution and
Performance, Journal of Business Research, Vol. 3, 2001. Dhaka, Bangladesh
Bhattacharjee, Durgadas and Islam, Seraul, Profit and Profitability of NCBs in
Bangladesh: An analysis of the dynamics and causal relation, Vol. XIV No. 1&2
Ross, Westerfield and Jordan, (2005-2006), Fundamentals of Corporate Finance, Tata
McGraw Hill
Thompson, Arthur A. Jr, Strickland, Strategic Management: Concepts and Cases, 13
th
edition, New Delhi: Tata McGraw-Hill Publishing Company Limited, 2003
Gupta and Gupta, Business Statistics, 12
th
edition, New Delhi: Sultan Chand and Sons,
2003-04
Sarker, L.R, Credit Risk Management in Banking, New Delhi : United Publication
Terry, G.R and Franklin, S.G, Principles of Management, 8
th
edition, 1994
Berger, Allen N., The Relationship Between Capital and Earnings in Banking, Journal of
Money, Credit and Banking, 1995
Desai, 1980; V.R.M Desai: Monitoring and Review of Performance Budgeting System;
Prajanan, Vol. XXVII No. 9; India
Kothari, C.R, Research Methodology, Methods and Techniques, 2
nd
edition, Wishwa
Prakashan, New Delhi, India
Laudon and Laudon, Management Information System, 8
th
edition, Prince Hall,India
Bangladesh Bank, Economic Trends, Dhaka, December, 2006
Daily Prothom Alo, Daily Star, The Economists, Bangladesh Observer
www.standardchartered.com
3.1 Model Questions (Source: Customer Service Advisors)
The different types of questions made by the Collectors to the customers are:
How does this solution sound to you?
Do you understand what the derogatory information on your credit bureau will do to your
refinancing opportunities?
Are there any reasons you know now about why you might not be able to keep this
arrangement?
I know these are hard times, did you suffer a loss of income and thats why you are
unable to bring the account current today?
We agree that the payment plan meets your requirements and that your first payment is
due in next day. This will resolve this situation in the short term. What about next
months payment?
Please correct me if I am wrong, but are you saying you are willing to let this account go
to a collection agency and have that information reported to the credit bureau? Do you
understand that the negative rating will stay on your credit report for seven years?
3.2 Customers Queries (Source: Customer Service Advisors)
In the collection process, the following queries of the customers are to be faced by the
Collectors:
The customers may call to the Collection Centre of Standard Chartered Bank to update
his/her new address and contact numbers in the database if he/she changes address or
contract numbers.
When cardholders dont make payment, their credit cards are blocked. Cardholders, at
that situation call or make physical visit to the Collection Unit to unblock the cards after
making payment.
Sometimes cardholders call to know whether their card is activated or not. It is very
common that the customers call to know the current balance about his credit card account
or loan account.
They also call for card cancellation which is very rare and the cardholders only call to
cancel the credit card due to some problems or dissatisfaction. Sometimes, customers call
to know how to close their loans.
The customers who use credit cards punching machine to provide the credit card
payments or loan payments, sometimes face problems regarding their payment and ATM
(Automated Teller Machine). For this reason they make queries. Besides, sometimes they
face some problems, like - magnetic stripe problem, wrong name embossed in the card
and other problems, and that is why they sometimes take the online service.
The cardholders can withdraw cash from the ATM machine by using the PIN number. But
sometimes they withdraw cash from the branch and at that time the branch people call to
the Collection Department for the authorization code for the valid cash transaction, like
-shops.
From the beginning SCB bank has been using its personal courier service for the better
and quick delivery of its necessary documents. Due to some reasons, sometimes the
customers do not get the documents regarding the credit card. Then they call to the
Collection Centre to know how to get the document
3.3 Steps Followed for Consumer Products (Source: Customer Service Advisors)
Personal Loan (PL), Flexi Loan (FL) and Business Installment Loan (BIL)
No Days Past
Due
Collection Steps Delinquency/
Provision
X DPD (0 29) Telephone calls and Dunning letters Delinquent
30DPD (30 59) Telephone calls and Remainder letters Delinquent
60DPD (60 89) Telephone calls, Remainder letters, visit customers,
use of agency, letters to Guarantor (if any) to inform
the obligation of payment
Delinquent
90DPD (90
119)
Telephone calls, final remainder, visit customer, use
of agency, interest suspended, legal notice
Delinquent /
Interest to be
suspended
120DPD (120
149)
Telephone calls, visit customers, report to Credit
Information Bureau (CIB) and other financial
institution, legal action, undated cheques (UDC)
placing for flexi and BIL
Delinquent / Non
performing for
Flexi and BIL
150DPD (150 +) 100% provision, handling accounts to agency,
undated cheque (UDC) placing and legal action for
PL, forced sale of item financed for flexi and BIL
100% charge off,
Non Performing
Loans
Here forced sale is the sale by the way of convincing customers, not by attachment obtained
by the court.
Auto Loan (AL)
No Days Past
Due
Collection Steps Delinquency/Provision
30DPD (30
59)
Telephone calls, Dunning letters, physical visit Delinquent
60DPD (60
89)
Telephone calls, Facility call up letters, legal
notice
Delinquent
90DPD (90
119)
Repossession activities and commence Delinquent, 50%
provision
120DPD (120
149)
Repossession activities continue Delinquent, 50%
provision
150DPD (150 -
179)
Repossession activities continue Delinquent, 50%
provision
180 Litigation 100% provision
Mortgage Loan
No Days Past
Due
30DPD (30
59)
Telephone calls, Dunning letters Delinquent
60DPD (60
89)
Telephone calls, Facility call up letters, physical
visit
Delinquent
90DPD (90
119)
Foreclosure activities commence Delinquent
120DPD (120
149)
Foreclosure activities continue Delinquent,50%
provision
150DPD (150 -
179)
Repossession activities continue/ litigation Delinquent, 100%
provision
Credit Card
No Days Past
Due
X DPD (0
29)
Telephone calls, Dunning letters, block cards Delinquent/Temporary
block
30DPD (30
59)
Telephone calls, Remainder letters, block cards Delinquent/Temporary
block
60DPD (60
89)
Telephone calls, Remainder letters, visit customers,
block cards
Delinquent/Temporary
block
90DPD (90
119)
Telephone calls, Remainder letters , visit customer,
use of agency/recovery, interest suspended, legal
notice, Hot list and circular within merchants
Delinquent/Interest
suspended/Permanent
block
120DPD (120
149)
Telephone calls, visit customers, final remainder,
seeking assistance from employer, legal action
Delinquent/Permanent
block
150DPD (150
+)
100% provision, handling accounts to agency, 100% charge off
Appendix 4.1: Operational Definition of Some Variables and Tools
Variables And
Tools
Operational Definition
Trend
The Trend is the long-run direction of the time series.
Correlation
Coefficient
The coefficient of correlation measures the strength of the linear
associated between two variables.
Growth Rate
Growth rate indicates the changes in the level of the variables over
the period of time in relevant term
Acceleration Rate
Acceleration rate is the average growth rate of the growth rates. It
indicates the future trend of the growth rate.
Benefit-Cost Ratio
The present value of an investments future cash flows divided by
its initial cost is known as Benefit-Cost Ratio.
Net Present Value
Net present value (NPV) is the difference between an investments
market value and its cost.
Appendix 4.2: Calculation of Trend Equation of Collection from Customers
YEAR COLLECTION (Y)
(MILLION)
2001-02 612
2002-03 587
2003-04 798
2004-05 786
2005-06 952
Source: Intranet of Standard Chartered Bank
Regression Output: Trend
Regression Statistics
Multiple R 0.926691518
R Square 0.858757169
Adjusted R
Square 0.811676225
Standard Error 65.0843043
Observations 5
ANOVA
df SS MS F
Significance
F
Regression 1 77264.1 77264.1 18.240 0.0235
Residual 3 12707.9 4235.966
Total 4 89972
Coefficient
Standard
Error t Stat
P-
value
Lower
95%
Upper
95%
Lower
95%
Upper
95.0%
Intercept 483.3 68.26 7.08 0.005 266.06 700.53 266.06 700.53
X Variable
1 87.9 20.58 4.27 0.023 22.40 153.39 22.40 153.39
Appendix 4.3: Calculation of Growth Rate of Collection from Customers
YEAR COLLECTION (Y)
(MILLION)
GROWTH RATE
(G)
2001-02 612
2002-03 587
-0.04085
2003-04 798
0.359455
2004-05 786
-0.01504
2005-06 952
0.211196
Source: Intranet of Standard Chartered Bank
The equation of per year Growth rate is
Growth rate (G) = (Y
n
- Y
n-1
)/Y
n-1
The results from the table-
G
1
= -4.085%
G
2
= 35.9455%
G
3
= -1.504%
G
4
= 21.1196%
The equation of average Growth rate is -

( ) 100 1
Y
Yn
' G rate Growth
1 n
1

'
,
_

Here,
( )
( )
100 1
612
952
' G rate Growth
1 5
1
5

'

= 11.678965%
The equation for Acceleration Rate is
Acceleration rate (A) = 100 1
Y
Y
Y
Y
2 n
1
2
1 n
n
'
,
_

= 100 1
612
686
2 5
1
587
4
952
2
5
'
,
_
= 8.087608453 %
Appendix 4.4: Calculation of the Determinants of Collection Cost
Month
Amount in
thousand
Total
cost
Total cost
of
unsecured
products
Total
cost of
secured
products
Number of
Collectors
July 06 73.6 64.1 3.3 69
August 06 73.6 67.4 3.4 70
September 06 73.6 69.0 3.6 70
October 06 73.6 69.0 3.7 70
November 06 75.0 62.4 3.3 70
December 06 83.0 51.0 2.7 70
January 07 58.0 55.1 2.9 90
February 07 58.0 55.1 2.9 90
Source: Management Documents of the Collection Centre
Descriptive Statistics
Mean Std. Deviation N
Cost in amount 71.050 8.66 8
Unsecured in amount 61.637 7.039 8
secured in amount 3.225 .357 8
collectors in number 74.875 9.341 8
Correlations
cost in
amount
unsecured in
amount
secured in
amount
collectors
in number
Pearson
Correlation
cost in amount
1.000 .246 .245 -.926
unsecured in amount .246 1.000 .184 -.173
secured in amount .245 .184 1.000 -.159
collectors in number -.926 -.173 -.159 1.000
Sig. (1- cost in amount . .278 .279 .000
tailed)
unsecured in amount .278 . .000 .069
secured in amount .279 .000 . .075
collectors in number .000 .069 .075 .
N cost in amount 8 8 8 8
unsecured in amount 8 8 8 8
secured in amount 8 8 8 8
collectors in number 8 8 8 8
Variables Entered/Removed
Model
Variables
Entered
Variables
Removed Method
1 collectors in
number,
secured in
amount,
unsecured
in
amount(a)
. Enter
a. All requested variables entered.
b. Dependent Variable: cost in amount
Model Summary
Model R R Square
Adjusted R
Square
Std. Error of
the Estimate
1 .991(a) .981 .967 1.563
a. Predictors: (Constant), collectors in number, secured in amount, unsecured in amount
ANOVA
Model
Sum of
Squares df Mean Square F Sig.
1 Regression 515.237 3 171.746 70.223 .001(a)
Residual 9.783 4 2.446
Total 525.020 7
a. Predictors: (Constant), collectors in number, secured in amount, unsecured in amount
b. Dependent Variable: cost in amount
Coefficients
Model
Unstandardized
Coefficients
Standardized
Coefficients
t Sig. B Std. Error Beta
1 (Constant) 183.707 10.796 17.016 .000
unsecured in
amount
-.864 .481 -.702 -1.796 .047
secured in
amount
6.795 9.353 .281 .727 .008
collectors in
number
-1.086 .077 -1.172 -14.057 .000
a. Dependent Variable: cost in amount
Appendix 4.5: Collection of Different Banking Products in the Month January,
February and March, 07
Personal Loan
Month January
CATEGORY ACTUAL
TARGET
(AMOUNT)
ACHIEVEMENT
(AMOUNT)
ACTUAL
TARGET
(NUMBER OF
ACCOUNTS)
ACHIEVEMENT
(NUMBER OF
ACCOUNTS)
INTERIM 7,707,107.50 6,175,346.17 844 724
X DPD 3,743,984.79 2,826,134.96 440 376
30 DPD 3,114,935.28 1,567,853.53 183 139
60 DPD 2,305,543.59 930,968.14 87 71
90 DPD 345,853.47 127,839.60 12 8
120 DPD 1,021,762.52 250,203.84 28 17
Month February
CATEGORY ACTUAL
TARGET
(AMOUNT)
ACHIEVEMENT
(AMOUNT)
ACTUAL
TARGET
(NUMBER OF
ACCOUNTS)
ACHIEVEMENT
(NUMBER OF
ACCOUNTS)
INTERIM 5,578,062.08 4,818,193.56 623 528
X DPD 4,521,208.25 3,537,868.60 492 415
30 DPD 1325923.45 1351049.44 167 132
60 DPD 2,169,534.50 1,081,156.41 87 77
90 DPD 851,538.01 226,512.53 26 18
120 DPD 259,510.06 55,500.06 8 5
Month March
CATEGORY ACTUAL
TARGET
(AMOUNT)
ACHIEVEMENT
(AMOUNT)
ACTUAL
TARGET
(NUMBER OF
ACCOUNTS)
ACHIEVEMENT
(NUMBER OF
ACCOUNTS)
INTERIM 5,606,202.98 4,341,571.32 553 458
X DPD 5,663,546.37 4,615,456.25 598 539
30 DPD 3,767,130.80 2,127,245.56 217 177
60 DPD 2,305,156.73 1,090,690.54 99 82
90 DPD 812,002.76 273,845.26 23 17
120 DPD 486,474.00 113,050.73 14 9
Source: Top Sheet (Performance Sheet) of the Collectors of Standard Chartered Bank
Flexi Loan
Month January
CATEGORY ACTUAL
TARGET
(AMOUNT)
ACHIEVEMENT
(AMOUNT)
ACTUAL
TARGET
(NUMBER OF
ACCOUNTS)
ACHIEVEMENT
(NUMBER OF
ACCOUNTS)
INTERIM 8,485,570.24 7,319,563.39 252 207
X DPD 5,663,473.22 4,937,697.14 199 170
30 DPD 1,972,038.42 1,347,672.69 51 42
60 DPD 1,346,391.82 824,232.27 22 15
90 DPD 555,443.23 824,232.27 9 5
120 DPD 65,559.78 0 1 0
Month February
CATEGORY ACTUAL
TARGET
(AMOUNT)
ACHIEVEMENT
(AMOUNT)
ACTUAL
TARGET
(NUMBER OF
ACCOUNTS)
ACHIEVEMENT
(NUMBER OF
ACCOUNTS)
INTERIM 7,846,321.30 6,466,861.99 204 170
X DPD 4,950,411.49 4,130,482.55 198 182
30 DPD 2,566,903.97 1764025.36 43 33
60 DPD 555,756.92 292,519.29 13 11
90 DPD 626,878.80 336,910.25 11 6
120 DPD 318,336.99 132,816.04 3 2
Month March
CATEGORY ACTUAL
TARGET
(AMOUNT)
ACHIEVEMENT
(AMOUNT)
ACTUAL
TARGET
(NUMBER OF
ACCOUNTS)
ACHIEVEMENT
(NUMBER OF
ACCOUNTS)
INTERIM 6,836,669.68 5,420,101.10 195 163
X DPD 5,422,214.28 5,021,686.78 212 194
30 DPD 2,662,774.92 1,956,013.71 50 45
60 DPD 1,090,645.78 565,780.72 17 14
90 DPD 145,076.49 69,396.00 3 3
120 DPD 193,665.68 0.00 2 0
Businesses Installment Loan
Month January
CATEGORY ACTUAL
TARGET
(AMOUNT)
ACHIEVEMENT
(AMOUNT)
ACTUAL
TARGET
(NUMBER OF
ACCOUNTS)
ACHIEVEMENT
(NUMBER OF
ACCOUNTS)
INTERIM 15,361,403.28 10,343,261.42 179 120
X DPD 6,764,128.52 4,375,182.16 85 60
30 DPD 5,336,922.90 2,360,321.12 40 27
60 DPD 4,521,043.98 637,199.00 20 10
90 DPD 4,500,806.23 344,561.73 13 5
120 DPD 788,024.74 318,951.39 2 2
Month February
CATEGORY ACTUAL
TARGET
(AMOUNT)
ACHIEVEMENT
(AMOUNT)
ACTUAL
TARGET
(NUMBER OF
ACCOUNTS)
ACHIEVEMENT
(NUMBER OF
ACCOUNTS)
INTERIM 6,068,608.54 5,178,608.89 68 57
X DPD 7,886,233.29 5,793,677.99 105 81
30 DPD 3,373,749.09 2,234,623.31 30 24
60 DPD 4,137,251.14 1,268,785.53 20 15
90 DPD 2,517,918.54 821,197.10 7 5
120 DPD 1,954,789.76 508,899.68 5 4
Month March
CATEGORY ACTUAL
TARGET
(AMOUNT)
ACHIEVEMENT
(AMOUNT)
ACTUAL
TARGET
(NUMBER OF
ACCOUNTS)
ACHIEVEMENT
(NUMBER OF
ACCOUNTS)
INTERIM 7,676,104.53 6,495,933.01 82 70
X DPD 8,279,692.47 6,937,466.97 125 114
30 DPD 4,134,500.07 2,210,153.89 37 27
60 DPD 2,346,424.46 808,853.80 15 13
90 DPD 3,590,406.93 613,803.73 12 6
120 DPD 4,085,115.95 505,871.54 9 6
Auto Loan
Month January
CATEGORY ACTUAL
TARGET
(AMOUNT)
ACHIEVEMENT
(AMOUNT)
ACTUAL
TARGET
(NUMBER OF
ACCOUNTS)
ACHIEVEMENT
(NUMBER OF
ACCOUNTS)
INTERIM 5,392,733.69 2,466,042.14 202 96
X DPD 5,459,906.24 4,540,131.06 196 171
30 DPD 2,934,107.93 1,868,865.95 49 42
60 DPD 1,735,248.24 529,633.48 16 12
Month February
CATEGORY ACTUAL
TARGET
(AMOUNT)
ACHIEVEMENT
(AMOUNT)
ACTUAL
TARGET
(NUMBER OF
ACCOUNTS)
ACHIEVEMENT
(NUMBER OF
ACCOUNTS)
INTERIM 4,187,611.57 2,542,656.43 152 96
X DPD 5,109,056.65 4,401,943.88 193 173
30 DPD 2,349,581.19 1,191,495.36 50 37
60 DPD 2,128,651.77 996,728.32 19 19
Month March
CATEGORY ACTUAL
TARGET
(AMOUNT)
ACHIEVEMENT
(AMOUNT)
ACTUAL
TARGET
(NUMBER OF
ACCOUNTS)
ACHIEVEMENT
(NUMBER OF
ACCOUNTS)
INTERIM 4,626,595.08 2,991,850.83 169 117
X DPD 5,751,966.29 5,015,528.63 226 210
30 DPD 2,417,007.31 1,221,517.84 50 42
60 DPD 2,292,137.66 1,183,894.70 24 23
Appendix 4.6: Calculation of the Regression between Recovery and Cost Commission
Month Total Recovery Total
commission
September 06 769,117.23 67,398.79
August 06 1,256,498.00 170,626.77
July '06 1,529,992.05 244,798.73
June '06 1,807,810.70 289,249.71
May 06 1,410,174.73 195,298.56
April '06 1,211,422.00 163,650.57
March '06 1,311,755.55 187,028.66
February '06 1,227,675.27 164,126.38
January '06 1,067,965.64 111,287.79
Source: Recovery Records of Standard Chartered Bank
Descriptive Statistics
Mean Std. Deviation N
recovery in amount 1288045.6
855556
289914.72363 9
commission in amount
177051.77 65523.971289 9
Correlations

recovery in
amount
commission in
amount
Pearson Correlation recovery in amount
1.000 .991
.991 1.000
Sig. (1-tailed) recovery in amount
. .000
.000 .
N recovery in amount
9 9
9 9
Variables Entered/Removed
Model
Variables
Entered
Variables
Removed Method
1
commission
in amount
. Enter
a. All requested variables entered.
b. Dependent Variable: recovery in amount
Model Summary
Model R R Square
Adjusted R
Square
Std. Error of
the Estimate
1 .991(a) .981 .979 42165.20414
a. Predictors: (Constant), commission in amount
ANOVA
Model Sum of Squares df Mean Square F Sig.
1 Regressio
n
659959044754.10 1
65995904475
4.104
371.201 .000(a)
Residual
12445331086.489 7
1777904440.9
27

Total
672404375840.59 8
a Predictors: (Constant), commission in amount
b Dependent Variable: recovery in amount
Coefficients
Model
Unstandardized
Coefficients
Standardized
Coefficients t Sig.
B Std. Error Beta
1 (Constant)
511953.039 42663.467 12.000 .000
commission
in amount
4.383 .228 .991 19.267 .000
a. Dependent Variable: recovery in amount
Appendix 4.7: Calculation of Trend Equation Recovery in Credit Card
YEAR RECOVERY
POOL(Y)
T RECOVERY
RATE
PROBABLE
RECOVERY
(BDT)
2000-01 2,876,192.98 1 17.47% 513,847.23
2001-02 10,969,216.46 2 4.01% 439,402.25
2002-03 20,279,518.66 3 7.38% 1,496,723.80
2003-04 58,477,224.91 4 10% 5,847,722.50
2004-05 37,907,149.99 5 10% 3,790,714.90
2005-06 75,627,530.60 6 10% 7,562,753.00
Total 206,136,833.60 21
2006-07 87,340,306.00 15% 13,101,045.90
Recovery by
Special
Team
6,380,848.43
Total 39,133,058.00
Source: Recovery Records of Standard Chartered Bank
Summary Output: Trend
Regression Statistics
Multiple R 0.908510028
R Square 0.82539047
Adjusted R Square 0.781738088
Standard Error 13269784.84
Observations 6
ANOVA
df SS MS F
Significance
F
Regression 1 3.33E+15 3.33E+15 18.90826 0.012172718
Residual 4 7.04E+14 1.76E+14
Total 5 4.03E+15
Coefficients
Standard
Error
t
Stat
P-
value
Lower
95%
Upper
95%
Lower
95.0%
Upper
95%
Intercept
-
13920680.56 12353497 -1.12 0.3228
-
4821948
7.92
2037812
7
-
4.8E+0
7
203781
27
X
Variable
1 13793377 3172085 4.34 0.0121
4986256.
305
2260049
8
498625
6
226004
98
Recovery Amount
Non-paying account in 2006 = 1800
Proportion of paying account form the non-paying account in 2006 = 19%
Paying account form the non-paying account = 1800 x 0.19 = 342 accounts
In 2007, predicted non-paying account = 1800
Predicted paying account out of these non-paying accounts = 0.19 x 1800 = 342
Now, total paying account in 2006 = 720,
Total payment in 2006 = 7096523
Average payment = 7096523 / 720 = 9856.28.
Management assumes the average payment out of non paying account in 2006 will be
reflected in 2007. So predicted average payment in 2007 is 9856.28.
So projected recovery from the non-paying accounts = Predicted average payment x
Predicted paying account out of non paying accounts = 9855.22 x 342 = 3370484. 43
Total recovery from non paying and special team = 3,010,000.00 (assumed by management)
+ 3,370,848.43 (payment form non paying account) = 6380848.43
Appendix 4.8: Calculation of NPV and Benefit-Cost Ratio
Project 1: Regular Recovery Investment
ANALYSIS 2006 2007
(PROJECTED)
INCREASE PRESENT
VALUE
Cost 6,000,000.00 9,000,000.00 3,000,000.00 /
50%
8,181,818.18
Recovery 60,000,000.00 85,000,000.00 30,000,000.00/41.
67%
77,272,727.27
Revenue
income
54,000,000.00 76,000,000.00 22,000,000.00 NPV =
69,090,909.09
Cost/taka
recovery
0.10 0.10 Benefit-cost
ratio = 9.4
Source: Recovery Records of the Collection Centre
Project 2: Agency Investment
ANALYSIS PER
ACCOUNT
TOTAL
(PROJECTED)
PER AMOUNT X
1200
PRESENT VALUE
Cost 500.00 6,00,000.00 5,454,54.54
Recovery 3,000.00 3,600,000.00 3,272,727.27
Revenue
income
2500.00 3,000,000.00 NPV = 2727272.73
Cost/taka
recovery
6 6 Benefit-cost ratio = 6
Project 3: Legal Investment
ANALYSIS TOTAL
(PROJECTED)
PRESENT VALUE
Cost 1,100.00 1000.00
Recovery 14,000.00 12,727.27
Revenue
income
12,900.00 NPV = 11727.27
Cost/taka
recovery
12.73 Benefit-cost ratio =
12.73
4.9 Capacity Planning for Month March
7-Jan 7-Feb 7-Mar
Accounts in amount $
X DPD 358,470 347,006 384,866
30 DPD 75,169 97,065 98,716
60 DPD 37,422 28,058 41,810
90 DPD 10,695 12,604 20,516
120 DPD 9,053 7,708 13,669
Account in number
X DPD 1,204 1,399 1,564
30 DPD 364 521 450
60 DPD 151 143 179
90 DPD 42 60 77
120 DPD 47 27 70
No. of calls required per account in month
X DPD 3 3 3
30 DPD 4 4 4
60 DPD 5 5 5
90 DPD 6 6 6
120 DPD 7 7 7
Total Calls required (number of calls required per account x number of
accounts)
X DPD 3612 4197 4691.545
30 DPD 1456 2084 1799.842
60 DPD 755 715 894.7113
90 DPD 252 360 459.6481
120 DPD 329 189 490.6507
Calls per Collector/day
X DPD 60 60 60
30 DPD 38 38 38
60 DPD 27 27 27
90 DPD 15 15 15
120 DPD 15 15 15
No. of Days 21 18 21
Total Call Capacity(calls per Collector per day x no of days)
X DPD 1260 1080 1260
30 DPD 798 684 798
60 DPD 567 486 567
90 DPD 315 270 315
120 DPD 315 270 315
Required no. of Collectors (required calls / call capacity)
X DPD 2.866667 3.886111 3.723448
30 DPD 1.824561 3.046784 2.255442
60 DPD 1.33157 1.471193 1.577974
90 DPD 0.8 1.333333 1.4592
120 DPD 1.044444 0.7 1.557621
Total 7.867242 10.43742 10.57369
Actual Capacity 9 9 9
(Gap)/Excess 1.132758 -1.43742 -1.57369
(2)

Analysis of Overall Activities of The Collection in Centre of Standard Chartered Bank

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Internship Report

A.S.M. Ahsanul Haque

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