Chapter - 5: Deposit Management

Chapter -5
DEPOSIT MANAGEMENT
Objective of Bank Deposit
Banks collect deposits mainly from the clients in order to
accumulate their investable funds. Besides, collection of
deposits has other objective such as the following:
1. Collection of Bank Fund
2. Ensure Productive Investment of the Scattered Savings of the
Clients
3. Extending the Scope of Loan
4. Fulfilling the excess need for money
5. Maintaining social responsibility
Deposit of the Banking System Vs. Deposit of
an Individual Bank/Level of deposit for the
whole Banking System Vs. Individual Bank
A. Level of deposits of the commercial bank system
B. Level of deposits at the individual banks:
1. Competitive interest rates
2. Physical features of bank office
3. Use of modern and electronic technology
4. Skilled bank executives
5. Innovating newer services
6. Inclusion of socially respectable person in the board of directors
7. Attractive loan and investment schemes policy
8. Suitable location for the office
9. Advantages of early start
10. Economic condition
Types of Bank Deposits
Types of Deposit Accounts in Asian Countries
There are variation in the needs and demand of the people . Bank generally
offer the following types of accounts to satisfy customers’ demand:
1)Current Account
2)Savings Account
3)Term of Fixed Deposit Account
4)Home saving Account
5)School Saving Account
6)Women’s Savings Account
7)Laborers’ savings Account
8)Insurance Saving Account
9)Foreign Exchange Saving Account
Post Office Saving Account
10)
11)Deposit Pension Scheme Account
Loan Deposit Account
12)
Recurring/Repeated Deposit Account on maturity
13)
Types of Deposit Accounts in the Western Countries
Deposit
Wholesale Accounts Retail Accounts
#Regular
Industrial Current Account transaction
Commercial Transaction
accounts with
organization Accounts
chequing facilities
Accounts Deposit Certificate #Special chequing
accounts
#Bank service
Current Deposit Account account
Deposit
Accounts #Now Account
Of #Super Now
Time Deposit Account Account
Government Savings
Units #Money market
Accounts
Treasury Deposit Deposit account
Current accounts of
Other Financial correspondent banks
Institutions #7-31 day duration
Term Accounts
accounts Balances of foreign central #31 day and above
and other banks duration
Deposit Processing
1. New account section(Information about the account Providing application

form ,booklet)
2. Acceptance of necessary application, photographs and documents
3. Checking
4. Permission of Managers
5. Depositing Primary Money
6. Data Entry
7. Delivery of Cheque book ,pass book and deposit receipt
8. Book Keeping
9. Depositor’s Statements
10. Review
11. Influence potential depositors
Deposit Mix
Deposit Mix is the combination of total deposits of the bank
with different kinds of deposit.
Deposit Mix
Ownership mix of deposit Types of Size mix of

deposit mix deposit
Proprietary Business Firm Saving A/C Up to 10 Lac
Industrial Firm Current A/C 10-50 Lac
Government Time Deposit 50 Lac and above
Foreign individual or firm
Factors Determining the level
of Deposits
Levels- wise classification of the deposit of the bank/branch(just an example )
Levels Amount in core Tk (for Amount in lac Tk (for

the bank) the branch)
‘A’ Levels Bank 1000 Crore and above Above 500 lac and above
‘B’ Levels Bank Above 100 to below 1000 Above 50 Lac to 500 Lac
‘C’ Levels Bank crore Below 50 Lac
Below 100 Crore
Factor Determining the Level of Deposits
Internal External
Quality of Bank personnel State of the National Economy
Characteristics of Local Economy
Diversified Services Role of Government
Public Confidence Relative Changes in Population
Interest Rate
Special Types of Deposit
Scheme
I. Consumer Credit Linked Deposit Scheme
II. Investment Deposit Scheme for Entrepreneurs
III. Farmers Investment Deposit Scheme
IV. Deposits Linked to House Loans
V. Deposits Linked to Old Age Provision
VI. Investment Facilitating Deposit Scheme
VII. Deposit with Insurance Benefit
VIII. Monthly Benefit Scheme
IX. Special Saving Scheme
X. Education Savings Scheme
XI. Hazz Scheme
XII. Saving Bond/ Certificate Scheme
XIII. One Counter Service Scheme
XIV. Advance Savings Scheme
Modern Electronic Banking
Technology
A. Modern Electronic Banking Technology
1. Proof Machine 10. Personal Identification Number(PIN)

2. Expediting Check Collection Process 11. Point of Sale Terminals
3. Record Keeping 12. Cheque Authorization Systems
13. Deposit Taking
4. National Numerical System
14. Direct Deposit and Pre-authorized
5. Use of Micro Film Payments
6. The Check Routing Symbol A Sorting Aid 15. Automatic Telephone Payments
7. Magnetic Inc Character Recognition 16. On-line Balance Enquiry
8. Electronic Sorting 17. EDP and Proof Operation
9. Automated Teller Machine 18. EDP and Check Collection Functions
Expediting Check Collection
Process:
1. Bank Credit Card , Master Credit

Card and Cards 8. Payment and
2. Debit Cards Telecommunication Services(PATS)
3. Point sale Services(PSS) 9. Payment and Advance
4. Transaction Administrative
5. Automated Clearing House Communication(PAAC)
(ACH) 10. Corporate Automatic Clearing
6. Home Banking House Services(CACHS)
A. Telephone Bill 11. Electronic Cash Management
Payment(TBP) 12. Card Based Payment Services
B . Video Home Banking 13. ACH Based Payment Services
(VHB) 14. Video Based Terminal Banking
7. Wire Transfer Network Services
a) Fed Wire
b) Bank wire
c) CHIPS-Clearing House Interbank
Payment System
d) SWIFT-Society For Worldwide
Interbank Financial Tele
Thank You

Chapter - 5: Deposit Management

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Chapter -5

Wholesale Accounts Retail Accounts

1. New account section(Information about the account Providing application

Ownership mix of deposit Types of Size mix of

Levels Amount in core Tk (for Amount in lac Tk (for

Factor Determining the Level of Deposits

1. Proof Machine 10. Personal Identification Number(PIN)

1. Bank Credit Card , Master Credit

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