1.

INTRODUCTION

Prime Bank Ltd. is operating as a scheduled commercial bank under the license issued by Bangladesh Bank, the Central Bank of the country on April 17, 1995 through opening of its Motijheel Branch at Adamjee Court Annex Building, Motijheel commercial area, Dhaka-1000. PBL was actually registered under the Companies Act of 1913 with its registered office at 5, Rajuk Avenue, Motijheel commercial area, Dhaka-1000 which was later shifted to Adamjee Court Annex Building, 119-120, Motijheel commercial area, Dhaka-1000. As a fully licensed commercial bank, Prime Bank Limited has been managed by highly professional and dedicated team with long experience in banking. Further Details on Prime bank, its organization and its branches are provided in Appendix. Major banking functions of Prime Bank Limited are performed mainly through three departments. These are: General Banking Department, Foreign Exchange Department and Credit Department. General banking consists of sections like: Account Opening Section, Local Remittance Section, Online Branch Banking Section, One Stop Utility Services Section, Deposit Schemes Section, Clearing Section, Collection Section, Cash Section, and Accounts Section. Foreign Exchange Department consists of sections like: Remittance, Import and Export. Credit department consists of two sections. Such as : Corporate Credit and Retail Credit. The credit facilities generally provided by the bank can be divided in to two broad categories. They are: Non-Funded Facilities, such as: Letter of Credit (L/C), Letter of Guarantee (L/G) and. Funded Facilities, such as: Loans, Overdrafts and Other advances. Loans are provided through different schemes. Consumer Credit Scheme (CCS) is one of them. This study has focused on Consumer Credit Scheme.

Consumer Credit Scheme is a form of credit that is becoming very popular in recent years. Banks that can operate CCS effectively make huge profit from this scheme. The demand of this scheme is increasing day by day. Now a days the standard of living is very high and people want to consume more products. On the other hand, because of consistent inflation there is huge money but few products .So, the prices of all products are high. In this situation this scheme seems very attractive to people who wants to consume but do not have enough money to spend on this products at a time. Besides this people take loans for investing share market and purchasing fixed asset like land, building, flat etc. For all these reasons this scheme is becoming more popular. Prime Bank is one of those local banks who are successfully operating Consumer Credit Scheme. Prime bank provides eleven types of loan under this scheme. These loans can be classified in to two categories. Such as: secured loans like Home loan, Car loan, House hold durables, Doctors loan, Loan Against Salary and unsecured loans like Education loan, Any purpose loan, Marriage loan, CNG conversion loan, Hospitalization loan, Travel loan. Car Loan is offered to purchase Car, Jeep, Station Jeep, Pick up Van, Cover Van, Bus, Truck, Ambulance and any other vehicle for own use. Doctors Loan is offered for the Doctors only usually to procure professional instruments. Advance against Salary loan is offered to any qualified person who is working as an employee in certain organizations allowed by the bank. Education Loan is offered for study purpose only. Travel Loan is for traveling purpose. Wedding loan is for wedding only. CNG Conversion Loan is offered to convert vehicle into CNG. Any Purpose Loan is for emergency need. Hospitalization Loan is for treatment in hospital. These loans have to be repaid within a specific period. Any interested person within the age range of 25 to 60 and having a permanent job or regular income can apply for the CCS loan of Prime Bank. Under CCS program of Prime Bank Limited a borrower can get maximum of taka 50, 00,000. The down payment is 20% to 10% of the loan for each product. The interest rate charged by Prime bank is comparatively higher than that of other local banks. Prime Bank charges 1% service charge and 1% risk fund for all

products other than Car loan, Doctors loan, Advance against salary and CNG Conversion loan. To make its position more strong, PBL wants to make this scheme more attractive to the customer. So, they introduced CNG conversion loan which is a unique loan only offered by Prime Bank in Bangladesh. They are enjoying the sole competitive advantage in this loan. PBL should include more differentiate product in their CCS, such as Loans for professionals, Shop Financing Scheme, Personal Loan for Women etc. to gain competitive advantage. Prime Bank Ltd has some problems in CCS. Those are: sometimes the down payment paid by CCS customers is very high with PBL. Interest rate and payback period are very important criteria for any kind of loan but most of the clients are not satisfied to PBL Consumer Credit interest rate and loan repayment period. In compare with local banks services of Consumer Credit Scheme of Prime bank is very satisfactory but in compare with multinational and foreign bank the service under this scheme is not that much satisfactory. For this reason CCS of Prime bank can not attract high profile customers like multinational banks but it is mostly preferred by people who prefer local banks. If Prime Bank can overcome its problems and develop more effective
strategy to compete with multinational and foreign banks they may became one of the dominating bank in banking sector of Bangladesh.

2. SCOPE OF THE STUDY

The study intends to provide a brief but complete idea about the functions of Consumer credit of Prime Bank Limited. Through this study an evaluation of the performance of Prime Bank limited in Consumer Credit Scheme has done and some problems have been

identified that hinder the better performance. Finally, recommendations have been prescribed to improve the performance of the bank in CCS sector.

3. RATIONALE OF THE STUDY

In this study the activities consumer credit scheme of Prime Bank Limited has been described. As this Scheme is in the growing stage this sector has to face dynamic changes and has to handle diversified clients with diversified demand. By this study the functions of CCS in different steps of loan sanctioning has been described. Through this study a current scenario of the performance of CCS of Prime Bank in compare with other banks has been stated. This study will help to find out the problems of CCS of Prime Bank which negatively affect the performance of CCS. At the end of this study some recommendation has also been prescribed that can be helpful for Prime Bank to improve their performance in CCS.

4. OBJECTIVES OF THE STUDY

4.1. Broad Objective:
The broad objective of the study is to describe the Consumer Credit Scheme of Prime Bank limited.

4.2. Specific Objectives:

To identify the functions of Consumer Credit Scheme of Prime Bank Limited. To evaluate the performance of Prime Bank limited in Consumer Credit Scheme.

To identify the problems observed in the Consumer Credit Scheme of Prime Bank Limited. To prescribe some recommendations to improve the performance of Credit department of PBL.

5. RESEARCH METHODOLOGY:
This research is an exploratory research. Only secondary sources are used in this study for data collection. In this study secondary sources are used because of their availability, authenticity and accuracy. Secondary sources used in this study are: different Procedure Manual published by PBL, Annual Report, study of old files, previous internship reports, web sites. No specific statistical technique is used in this study for data analysis.

6. LIMITATIONS OF THE REPORT:

The study had to be completed under certain constraints, which obstruct it to be more effective. Some of these constraints are listed: Insufficient time to know all activities of the branch and prepare the report. Shortages of sufficient data for comparing It was very difficult to collect the information from various personnel for their job constraint. Every organization has their own secrecy that is not exposed to others. Errors rise from the lack of practical knowledge and experience.

For these limitations this study may not cover all areas and may have unintentional errors and omissions.

7. DISCUSSIONS, ANALYSES & FINDINGS

Prime bank provides eleven types of loan under Consumer Credit Scheme. These are: car loan, household loan, home loan, advance against salary, education loans, travel loan, marriage loan, CNG conversion loan, any purpose loan, hospitalization loan and doctors loan. . Any interested person within the age of 25 to 60 can apply for loans. Prime Bank charges 1% service charge and 1% risk fund for all products other than for car loan, doctors loan, advance against salary and CNG conversion loan. For car loan the stamp fee is taka 600, for household durables and home loans the stamp fee is taka 450 and for other loans under CCS the stamp fee is taka 300. For more details the PPG and credit policy are provided as appendix. The discussion, analysis and findings part of this study is divided in to three sections. These are: functions, evaluation and problems of consumer credit scheme of prime bank.

7.1. Functions of CCS of Prime Bank:

To find out the functions of CCS at first loan sanctioning process have to be understood, because all the activities of CCS arise from this process. At first, Customers approach any commercial branch of the bank or banks agents approach to the clients. Then bank receives relevant documents from the customers. Then they forward a proposal to the Head Office. Head office analyzes the customers credit worthiness. In this step bank also verify the customers by third party. After assessment the Head office select the eligible consumers and sanction the loan. Head Office then forwards a sanction letter to the branch and gives the disbursement authority to the branch. Branch modifies the sanction

letter as per their need and advice to the customer to provide the additional documents they needed. Customer gives acceptance and requests the branch for disbursement. Finally, Branch completes all documentation and disburses the loan. While sanctioning a loan mainly 4 types of function have to be done. Assessment Documentation Disbursement Monitoring & Recovery The functions of CCS of Prime Bank Limited are decentralized. Thats why assessment is done by Head Office, Documentation and Disbursement are done by branches and Monitoring & recovery is done by both Branch and head office.

7.1.1 Assessment:
Basically Assessment of customer is the function of Head office. But sometimes branches also assess customer for confirmation if they have suspicion about any customers. 5c is used to assess customers credit worthiness. The elements of 5c are: Character, Capacity, Collaterals, Condition and Cash. The information collected through application form is used for assessment and third party verification is also used.

7.1.2 Documentation:
An important function of CCS department is collecting all required information from the customer before disbursement of loan. For CCS loan, Bank usually uses two types documents. One is application from and other one is charge document. List of these documents are given bellow and for details please see at Appendix. 7.1.2.1Application Form:

The contents of application form for CCS loan of different banks are almost the same and these are as follows: personal details of applicant (s), employment Details, loan details, financial details, particulars of guarantors, quotation, letter of assurance, declaration, certification of the organization, two copy of Photographs and copy of national ID card. A specimen of an application form is attached in the appendix. Applicants have to submit some additional documents with the application form. The additional documents are: Salary certificate for service holders. Trade license and TIN Certificate (if any) for businessperson. TIN Certificate of applicants for vehicle loan (compulsory) Bank statement of last six month. Attested photocopies of current tax receipt, electric bill etc & lease agreement (if any) when the source of income is house rent as a land lord.

Branch will inspect the given information with respect to eligibility, feasibility and security. After completion of all necessary formalities, Branch shall disburse the loan or refuse the proposal within 7(seven) working days from receiving the additional papers. 7.1.2.2Charge Documents: Charge documents are set of documents that contain different rules, terms and conditions. If the borrower of CCS loan agrees with all these terms and conditions regarding the loan s/he needs to sign all the documents. If any disagreements or irregularity occurs in future, these documents will be exercised to suit against the borrower. Before the disbursement of CCS loan, the following documents must be signed by clients. The stamps needed for these documents are paid by the clients. The basic documents demands by the bank are as follows: letter of guarantee, letter of hypothecation, demand promissory note, letter of

installment, letter of disbursement, letter of agreement, and letter of authority. Specimens of all this documents are attached in the appendix.

7.1.3. Disbursement:
Loan amounts under loan facilities disbursed only when all security documentation is in place. CIB report is obtained, as appropriate, and clean. A sample documentation and disbursement checklist is attached as Appendix. When loan is granted, the amount of loan is entered in the account of the customer and s/he is allowed to withdraw money up to the amount agreed upon.

7.1.4. Monitoring & recovery:

Head office prepares regular report of over limit and overdue, mainly engaged in monitoring and branches are mainly involve in recovery. Besides CCS recovery department are also engaged in recovery. Recovery department take steps by their own or they take helps from different recovery agencies. For recovery many procedure are followed. Such as: Letter, Follow up & Persuasion over phone Reminder letter, Single visit, Group visit, Letters to Guarantor, Employer. Bank gives warning on legal action and takes legal action only when there is no other way of recovery. This is the last approach preferred by bank. This step is taken by head office. The approaches of recovery to various customers can be showed as follows: In case of soft clients, Consumer Credit Department approaches by their own to recover the dues. In case of hard clients, Recovery Department approaches to collect the dues. Sometimes recovery department takes help from recovery agencies. At the final stage, Head office take legal action and suit case against clients.

7.2 Evaluation of CCS of Prime Bank:

Consumer Credit Scheme is one of the most attractive Schemes for both clients and bank. Because of the continuous improvement of the standard of living attractiveness of CCS is also increasing day by day. For this reason all of the banks are trying to improve their performance in CCS. Though CCS of every bank is similar but CCS sector of every bank have some strong and weak points that affect their performance to the customers. The current scenario of CCS of PBL in compare with other banks is discussed here. PBL has high reputation as a bank that practices customer oriented banking among the local banks of Bangladesh. Besides, this year PBL has received SAFA (South Asian Federation of Accountants) award as the Best Bank and also received ICBA for best presented accounts and ICMAB for best corporate governance award. Prime Bank has already launched every product available under CCS. Not any other bank except Prime bank has launched all of these schemes yet. This characteristic of CCS of PBL is positively considered by customers while taking decision of taking loan under CCS. Moreover no other banks are providing C.N.G. Conversion loan which is an exclusive scheme offered by Prime bank. In this aspect Prime bank has an absolute advantage over the other banks in this scheme. Prime bank have a large number of branches all over the country. It already has 90 branches all over the country and the number is increasing day by day. As a result of these it has a large customer base. This huge customer base is very helpful for CCS because every customer of different schemes can be a possible customer of CCS. PBL is very conservative in customer selection. Prime Bank Limited does not establish any link with any multinational company consists of huge employee base and salary amount. Multinational Banks earn huge profit from this type of liaison. For example, Standard Chartered Bank has link with Grameen phone and Bangla Link and HSBC has

link with Robi and Citycell. The whole salary amounts of these companies provide a huge deposit for these banks. Prime bank does not practice priority banking. Whereas multinational banks often provides priority banking services. Banks usually provides priority banking services by preferential pricing on all products and charge-free banking services. For example, Standard Chartered bank treats Grameen Phones employees specially. Standard chartered charges only 50% or nil service charge from employees of GP and also allows rebate for them. While evaluating the performance of Consumer Credit Scheme the interest rate charges by the bank in compare to other bank is an important criterion. The comparisons of the interest rate of PBL for different schemes with that of other banks are given bellow: In case of car loan it can be seen that Eastern bank charges the lowest

(13%) interest rate where BRAC bank charges the highest (18%). However Prime bank used to charge 16% which is between the two extremes and therefore a suitable one. Mercantile bank also charges the same rate. (Details included in appendix)

It can be said that BRAC bank is charging the highest interest rate for household durables loan and the rate is 19.5%. Prime bank is standing on 18% which is the second highest percentage in terms of this issue. Eastern bank is charging the lowest rate of interest for this loan which stands at 15.5%.. (Details included in appendix)

Doctors loan is an exclusive product offering for the doctors. Other than Prime bank this loan is offered by BRAC and Mercantile bank. The diagram shows that Mercantile bank charges 16% as their interest rate

(lowest in this regard) while Prime and BRAC bank used to charge 18% (highest). (Details included in appendix) It can be said that for any purpose loan the interest rates are varying from 16% to 18.5%. Prime bank charges 18% interest rate which is nearly the highest. (Details included in appendix.)

Advance against salary is an exceptional scheme and has been provided by only two banks, i.e. Prime and BRAC bank. It can be showed that both Prime and BRAC bank are offering the same rate of interest, which is 18%. So no bank has any advantage or shortcoming over the other bank in terms of interest rate. However Prime bank should consider modifying the rate. (Details included in appendix.)

Though another credit scheme is known as education loan in Prime and Eastern bank, it has different names in the other two banks. In BRAC bank it is known as Study Loan and in Dutch Bangla bank it is called Education Line. Prime bank is charging the highest interest rate (18%) among all the banks that are offering this loan. (Details included in appendix.)

It can be said that for travel loan the interest rates are varying from 19% to 15.5%. Prime bank charges 18% interest rate which is nearly the highest. (Details included in appendix.)

Hospitalization Loan is another unique offering in the area of CCS. This loan is offered by only two banks, Prime and Dutch Bangla bank. Prime bank is charging 18% rate of interest while Dutch Bangla bank is asking for a rate that is a little lower, i.e. 17%. Due to this fact, Prime bank is not in a better position than its competitor in this aspect. (Details included in appendix.)

Marriage loan is another distinctive offering by Prime and Dutch Bangla Bank Limited (DBBL). These are the only two banks which offer this credit scheme to meet marriage expenses. From the diagram it can be seen that Prime bank is offering the loan at 18% interest rate. On the other hand DBBL is offering the same loan at 17% interest rate. Prime bank has only one competitor regarding this loan and their competitor is offering the loan at a lower rate. So, PBL should consider slightly modifying their interest rate. (Details included in appendix.)

In case of home loan, the diagram shows that Prime bank is charging 14% interest rate which is highest in this aspect. Moreover, Dhaka and Dutch Bangla bank each are taking 13% rate of interest. Eastern bank do not have any fixed percentage of interest for this loan. Their rate tends to vary as per the amount of loan that clients take. Again, in Prime bank if the customers take this loan for construction purpose then they have to pay 16% interest rate. (Details included in appendix.)

C.N.G. Conversion Loan is a unique scheme offered by Prime bank. No other bank is providing this loan. In this aspect Prime bank has an absolute advantage over other banks in this area of CCS.

After above discussion it can be said that CCS of PBL charge comparatively high interest rate than other banks but Prime Bank has not taken any hidden charge in the CCS scheme while many other banks have charged hidden cost from the customers. If hidden charge is applied then the cost of loan will be more than the cost declared by the bank. Rate of down payment is another important factor. In case of any purpose loan, education loan, household durables, car loan, and doctors loan Prime bank charges 20% down payment and for hospitalization loan , marriage loan, travel loan PBL charges 10% down payment, where other banks charges less or nil down payment. Only for advance against salary PBL does not charge any down payment. Prime Bank Limited charges 1% risk fund for all types loan under CCS except home loan. For home loan PBL charge 0.5% risk fund. Risk fund has not charged by many other banks for any loan under CCS. (Details included in appendix.)

Prime Bank charges taka 600 as stamp fee for car loan, taka 450 for household durables and home loans and taka 300 for other loans under CCS. PBL charges the least amount as stamp fee. The stamp fee charge by other banks ranges from 1000 to 1500. (Details included in appendix.)

Prime bank takes miscellaneous charge which stands at Tk. 100. This charge has not applied by other banks. Prime bank did not charge early settlement fee whereas all other banks charges early settlement fee.

The maximum and minimum limit of loans offered under CCS is another important criterion considered by clients. The maximum and minimum loan limits of PBL for

different schemes and the position of the limits of PBL in compare with other banks are given bellow:

It can be said that, the limit (3 lac 20 lac) for car loan of Prime bank is a standard limit in compare with other banks. (Details included in appendix.)

In case of doctors loan, prime bank offer the least highest limit the limit(10lac) but a suitable lowest limit( 3 lac) in compare with other banks. (Details included in appendix.).

It can be said that, in case of house hold loan, most of the banks including Prime bank is offering Tk. 5 lac as highest limit. Prime bank is offering a lowest limit as Tk. 3 lac that is comparatively higher than that of other banks. (Details included in appendix.).

In case of any purpose loan, Prime bank offer comparatively very lower highest limit (3 lac) than that of other banks. PBL also offer the least low limit (0.50 lac) like some other banks. (Details included in appendix.).

The highest loan limit of Prime Bank in case of advance against salary can be varied according to the income of the clients. (Details included in appendix.).

In case of education loan, both Eastern and Dutch Bangla bank are giving the highest limit of Tk. 10 lac. However Prime bank is giving the highest limit at Tk. 5 lac which is exactly half of the amount that is allowed by other two banks. Prime bank is clearly bearing a weak point in this aspect. On the other hand the three banks are offering the same lowest limit that is Tk. 0.5 lac. (Details included in appendix.).

In case of travel loan, Prime bank has a lacking in this point that the highest loan offering is only Tk. 2 lac which is very lower than other banks. On the other hand, PBL offer a standard lowest limit of Tk. 0.5 lac. (Details included in appendix.)

In case of hospitalization loan an interesting observation has been found from the diagram. The PBL and DBBL, both banks are offering exactly the same limits for both maximum and minimum loan amount. The highest loan limit for both the banks is Tk. 5 lac. On the other hand the minimum loan limit for Prime and Dutch Bangla bank is also same, which

is Tk. 0.5 lac. In this way the banks are neither in a better nor in a worse position than each other. (Details included in appendix.). Prime bank is offering only Tk. 3 lac as their loan limit for marriage loan. However Dutch Bangla banks offering is Tk. 10 lac, which is more than three times than the limit of Prime bank. So in this point Prime bank is falling behind. On the other hand, the minimum loan amount is same for the two banks and the amount is Tk. 0.5 lac. In case of home loan, Prime and Dutch Bangla bank are offering the same limit that of Tk. 50 lac that is good but Prime banks minimum loan limit (10 lac) is the highest among that of all banks. (Details included in appendix.) After observing the situation it can be said that the lowest loan limits are not matter of concern but the highest loan limits of some schemes should be modified.

The pay back period is another important point of concern while considering a loan scheme. The pay back periods that have allowed by Prime bank for different schemes are not satisfactory to customers. (Details included in appendix.). The well-behaved and generous employee base of CCS of Prime Bank is another positive side of CCS of PBL. Employees of CCS successfully build and maintain long term relationship with customers. Prime bank provides more prompt service than any other local bank. Telephone inquiries of consumers of PBL get highest response. The employees of CCS of Prime Bank are suffering for lack of job description and specification. The Job description and Job Specification and the responsibilities for each position in the branch are not clearly specified. For this reason confusion arises among

employees. PBL Also does not practice job rotation adequately which causes few employees have versatile expertise in different banking sector. The credit policy of Prime bank is not flexible but Prime Bank always tries to match their policy with the government policy and customer needs which increases its acceptability to customers. PBL do not have any plan to practice fast track banking. Documents demanded by CCS of PBL are huge in compare with multinational bank. The loan sanctioning procedure of Prime Bank limited is lengthier than multinational banks. It will take 10-15 days for sanctioning a loan under CCS of PBL. Like other local banks, PBL also can not practice proper employee selection, motivation & training. Assign right person at right place in right time is the main task of HRM. Like other private banks Prime Bank also appoint employee from internal sources. Some times this includes inefficient employees in the employee base. For these reason, lack of efficient employee is becoming a problem for PBL like other local banks. Now-a-days all multinational and foreign banks preferred comparatively young persons as high officials. The reason behind this is the hypothesis that a young person can easily understand the current market situation and modern customers demand than an older official who is used to work within a backdated system for years after years. Like other local banks in Prime Bank absence of younger people as high officials has been seemed. Like other private banks and companies CCS of Prime Bank also suffers for shortage of manpower which reduces the efficiency of services. Monitoring of PBL is comparatively weak than other banks. For this weakness bank have to tolerate more overdue. Prime Bank disburses the loans on different dates of months and the last date of payment of installment is also different for different loans. So, it becomes very difficult to find out that exactly which loans installments are overdue and how many installments are overdue on a specific date. When defaulters are identified in

the meantime a huge overdue amount has already piled up and collection of a huge amount is always difficult than that of a small amount. Marketing Department of PBL is weak. PBL is suffering for lack of efficient sales people like other local banks. The research and development sector of marketing is not much effective. R&D sector of Prime Bank does not use enough primary sources in data collection while conducting a study. They usually use secondary sources of data that may be inaccurate, invalid and backdated. The current market situation of CCS is not clearly known to PBL because of its weak R&D sector. For this reason it can not compete with multinational banks and can not attract high profile customers. Computer and IT department is really weak. For IT problem Service of CCS and other sector is affected negatively. The banking software used by Prime Bank Limited is T24. T24 is the latest banking software but Prime bank does not have enough capacity and expertise to customize this software according to their need. For this reason many problem arises. For example, a loan has been divided in to classified and unclassified categories on the basis of over dues. For a three years loan, if three installments is consistently remain overdue than it is known as Special Mention Account (SMA). After that up to six months this loan is known as unclassified (UC) loans. After that next six to nine months the loan is known as substandard loans. After that next nine to twelve months the loan is known as doubtful (DF) loans. Finally, next twelve to eighteen months the loan is known as bad and loss (BL) loans. DF and BL loans are classified loans. When a loan becomes classified then the software can not charge the installments automatically. Then this process has to be done manually which is a time consuming and complicated task for employees. Beside this problem the IT sector has other problems. The capacity of server is not enough for the bank. In pick banking hours different problems arise like server become overloaded; IPs are conflicted with each other and stops printing. Though Prime Bank developed a website for its customers and interested persons to inform about their products and services, it rarely updates its website. This kind of practice may misguide its customers about up to date information.

Prime Bank Ltd. has sponsored a foundation to practice Corporate Social Responsibility through ensuring basic needs, the education and healthcare in particular, for the under privileged section of our society. Now-a-days, Companies and banks are getting involved to CSR not only for social good but also to build reputation. CSR is also using as a tool of publicity. PBL has to give more emphasize on CSR (Corporate Social Responsibility) like multinational banks. After all, it can be said that performance of CCS of PBL is satisfactory while comparing with other local banks but not at all satisfactory while comparing with multinational banks.

7.3 Problems of CCS of Prime Bank:

Though PBL is one of the local bank who can profitably operate Consumer Credit Scheme, there are some problems which affects the performance of CCS of PBL. The problems are discussed bellow: Problem-1: Prime bank charges high interest rate among the local banks. Though the service of PBL is better than other local banks but because of high interest rate many clients have not considered Prime bank as their fist preference Problem-2: The cost of loan of Prime bank is higher than other banks. Prime bank charges down payment, risk fund, miscellaneous charges whereas many other banks do not charges this cost or charges less cost. Problem-3:

It is very difficult to find out that exactly which loans installments are overdue and how many installments are overdue on a specific date. Reason behind this is the presence of different date of disbursement for different loans. Problem-4: Research & Development sector does not use adequate primary sources in data collection. For this reason they do not provide appropriate information about market, customer demand, current situation, and competitors etc to contribute enough in decision making. Problem-5: Server has become overloaded in pick hours. For this reason IP confliction occurred that results stop printing and delays of service. Problem-6: Prime Bank Limited does not establish any link with multinational companies who can be high profile customers. Problem-7: The paper complication and lengthy procedure of CCS is a common complain of clients. Problem-8: Sometimes inefficient employees are added in the employee base because of references. Besides this there are lacking of proper Motivation & Training. Problem-9: When a loan becomes classified then the software can not charge the installments automatically. Then this process has to be done manually.

Problem-10:

Head Office centrally holds the whole power of sanctioning CCS loans which is not appreciated by vital clients. Problem-11: Prime bank do not practices priority banking. Problem-12: The Job description and Job Specification and the responsibilities for each position in the branch are not clearly specified.

Problem-13: Lack of Job Rotation is another problem. In PBL job rotation is not practiced adequately. Problem-14: The credit policy of Prime bank is not flexible Problem-15: PBL do not practices adequate CSR activities in compare with multinational banks.

8. RECOMMENDATIONS:
Recommendation-1: Prime bank should modify the interest rate for all the schemes where competitors are charging equal or less interest rate than that of PBL. Recommendation-2:

Prime bank should reduce or withdraw some charges like down payment, risk fund, miscellaneous charges. Because of these charges the cost of loan of PBL become higher than that of other banks.

Recommendation-3: All disbursement of all loans under Consumer Credit Scheme should be on one date. Then it will be easy to find out that exactly which loans installments are overdue and how many installments are overdue on a specific date. Recommendation-4: Research and development sector should use more primary sources in data collection while conducting research. Then the studies will be more effective and will contribute more in decision making Recommendation-5: Steps should be taken to increase the capacity of server to serve the increasing customer base. Recommendation-6: Prime Bank Limited should take steps to establish link with multinational companies. Recommendation-7: Paper complication should be reduced and easy and simple procedure should be developed and used in case of CCS loan. It may be done by reducing some documents that are less important and reducing steps of loan sanctioning

Recommendation-8: HR division and IT Division should work together in selecting eligible employees, motivating them and arranging training session for the employees on the basis of need. Recommendation-9: Steps should be taken to customize the T24 software so that this problem can be solved.

Recommendation-10: Head Office may delegate some authority to the branch to sanction the proposal of some important clients of the branch. Decentralize control will be more profit oriented than centralized control Recommendation-11: PBL should take steps to involve priority banking like multinational banks. Recommendation-12: Head Office should issue office order describing the Job description and Job Specification and the tasks to be performed for each job in the Branch. Recommendation-13: Authorized persons should develop a routine rotation plan for all employees Recommendation-14: The credit policy should be more flexible and should be updated. Recommendation-15: PBL should focus on more specific sectors while practicing CSR.

Above all, the management should be more up to date about the whole banking world and should prepared for competing with the multinational banks.

9. CONCLUSION:

The Prime Bank Ltd. is a large local bank in our country. For any kind of loan and advances PBL is always preferred by people who preferred local. The banking sector plays an important role in the success of economic development of the country. But this sector has been suffering from so many problems like corruptions, unsatisfactory performance level or overdue loan, poor recovery rate and unethical and illegal influences in decision-making process etc. These problems can be overcome through increasing employees efficiency by training & motivating, enhance recovery rate, strictly prohibiting unethical & illegal influences in decision making process etc. There is no alternative of skilled, trained and professional manpower. So, continuous banking and business related training, learning and development are essential for Prime Bank Ltd.. to enrich knowledge and develop skills and competences to succeed in todays dynamic banking world and to compete with multinational banks. To reach its expected goals, Prime Bank Limited has to compete with multinational and foreign banks along with local bank. After all, PBL must put special attention to its employees, customer segmentation, service quality and IT and R&D sector.