The main objective of this report is to observe the Assessment of Social Welfare of Islami bank and other Conventional bank in Bangladesh, here focus on Islami Bank Bangladesh limited. Other objectives are to analyze the option of social welfare activities of Islamic Banks in Bangladesh. Overall discuss on investigate the welfare activities done by IBBL. Finally find-out some problems and give recommendation on the basis of findings.
Part A: Organization Part
The main objective of this report is to observe the Assessment of Social Welfare of Islami bank and other Conventional bank on Bangladesh.
Part B: Project Part
This report has been prepared considering the following objectives:
- To analyze the option of social welfare activities of Islamic Banks in Bangladesh
- To investigate the welfare activities done by IBBL
- To give recommendation on the basis of findings
Methodology is a set of practices. This term may be used to refer to practices that are widely used across an industry or scientific discipline, the techniques used in a particular research study, or the techniques used to accomplish a particular project.
The data required for this study were collected from both primary and secondary sources. However, majority of the information was collected from secondary sources.
a) Primary sources:
Data has been collected primarily through correspondence with the Personnel working in different desks.
Primary data was collected form
- Branch Manager & Second Officer
- Face to face conversation with employees and staffs
- Practical work experience
- Face to face conversation with clients
However, no structured questionnaires were developed for the purpose.
b) Secondary sources:
Secondary sources consist of several reading materials such as circulars, Journals, brochures and Annual Report.
The secondary data has been collected from
- Annual Report of Islami Bank Bangladesh Limited
- IBTRA Library
- Manuals of Investment of IBBL
- Different text books & materials
- Unpublished data
- Different manuals & circulars of Islami Bank Bangladesh Limited
- Website of Islami Bank Bangladesh Limited
- Face to face Interview.
The major portion of the data source used for this report is a secondary one.
In 1974, Bangladesh signed the Charter of Islamic Development Bank and committed itself to reorganize its economic and financial system as per Islamic Shariah, which is based on “Holy Quran” and “Sunni”.
In 1981, President of the Peoples Republic of Bangladesh addressed the third Islamic Summit Conference held at MacKay and Taif suggested, “The Islamic countries should develop a separate banking system of their own in order to facilitate their trade and commerce.”
Islami Bank Bangladesh Limited (IBBL) is considered to be the first interest free bank in Southeast Asia. It was incorporated on 30-03-1983 as a Public Company with limited liability under the companies Act 1913. The bank began operations on March 30, 1983, with major share by the foreign entrepreneurs. At present l2.9% of total banking business owned by the IBBL in Bangladesh.
IBBL is a joint venture multinational Bank with 63.92% of equity being contributed by the Islamic Development Bank and financial institutions like-AI-Rajah Company for Currency Exchange and Commerce, Saudi Arabia, Kuwait Finance House, Kuwait, Jordan IBBL, Jordan, Islamic Investment and Exchange Corporation, Qatar, Public Institution for Social Security, Kuwait Ministry of Awqaf and Islamic Affairs, Kuwait and Ministry of Justice, Department of Minors Affairs, Kuwait.
In addition, two eminent personalities of Saudi Arabia namely, Fouad Abdul Hammed Al-Khateeb and Ahmed Salah Jamjoom are also the sponsors of IBBL. The total number of branches by 2011 stood at 205. Now the authorized capital of the bank is Tk.1,000 Core and paid up capital of the bank is Tk.617.76 Core as on 5 October, 2011.
Islamic bank has been defined in a number of ways. The definition of Islamic bank, as approved by the General Secretariat of the Organization of Islamic Conference (OIC), is stated in the following manner.
“An Islamic bank is a financial institution whose status, rules and procedures expressly state its commitment to the principle of Islamic Shariah and to the banning of the receipt and payment of interest on any of its operations.”
Corporate information (as on 20 February 2012):
Name of Company : Islami Bank Bangladesh Limited
Date of Incorporation : 13th March 1983
Inauguration of first Branch : 30th March 1983
Local Office, Dhaka (Then the Main Branch)
Formal Inauguration : 12th August 1983
Authorized Capital : Tk. 20,000 million
Paid-up Capital : Tk.10, 007.71 million
Equity (as on 30.06.12) : Tk.20, 431.00 million
Deposit (as on 31.08.12) : Tk. 341,361 million
Investment (as on 31.08.12) : Tk. 341,031 million
Foreign Exchange Business : Tk. 236,607 million
Number of Branches : 238 Branches +30 SME Service Centers
Number of Shareholders : 63,001 (30.06.2011)
Manpower : 11,465
a) Local Shareholders : 32%
b) Foreign Shareholders : 68%
Vision of IBBL:
Vision of IBBL is to always strive to achieve superior financial performance, be considered a leading Islamic Bank by reputation and performance.
- Goal of IBBL is to establish and maintain the modern banking techniques, to ensure the soundness and development if the financial system based on Islamic principles and to become the strong and efficient organization with highly motivated professionals, working for the benefit of people, based upon accountability, transparency and integrity in order to ensure the stability of financial system.
- IBBL will try to encourage saving in the form of direct investment.
- IBBL will also try to encourage investment particularly in projects, which are more likely to higher employment.
Mission of IBBL:
To establish Islami Banking through the introduction of a welfare oriented banking system and also ensure equality and justice in the field of all economic activities, achieve balanced growth and equitable development through diversified investment operations particularly in the priority sectors and less development areas of the country.
Objectives of IBBL:
The primary objective of establishing IBBL all over the world is to promote, foster and develop the application of Islamic principles in the business sector. More specifically, the objectives of IBBL when viewed in the context of its role in the economy are listed as following:
- To offer contemporary financial services in conformity with Islamic Shariah;
- To contribute towards economic development and prosperity within the principles of Islamic justice;
- To conduct interest-free banking.
- To accept deposits on Mudaraba & Al-Wadeah basis.
- Optimum allocation of scarce financial resources; and
- To help ensure equitable distribution of income.
Functions of the organization:
The functions of Islami Bank Bangladesh Limited are as under:
- To maintain all types of deposit accounts
- To make Investment
- To conduct foreign exchange business
- To extend other banking services
- To conduct social welfare activities through Islami Bank Foundation
Shariah Council of IBBL:
The Shariah Council of Islamic Bank generally consists of experts from the following four areas:
- Fuqaha: Persons representing this group must be well versed in the Quran, Sunnah and fully conversant with the opinion of all schools of Islami thought and Islami law and jurisprudence. They must view Islam as a total way of life and a living religion.
- Banker: There must be a member who is fully conversant with banking law and practices and has practical experiences in Banking business including foreign trade.
- Economist: A member from this group need not necessarily be an Islami economist to start with. However, if he is an Islami Economist it is an added advantage. What is important is that he must be proficient in modern economies with an in depth study of the community, which a bank is going to solve. He must have up to date knowledge in the development of the contemporary world.
- Lawyer: A member representing this group should be a successful practitioner lawyer. He must be proficient in commercial law including company law. In consultation with the Fuqaha and Economist members of the council, he should be able to draft such innovating contracts, which will have the sanction of Islami principles and a banking law of the land.
- Trust in Almighty Allah
- Strict observance of Islamic Shari’ah
- Highest standard of Honesty, Integrity & Morale
- Welfare Banking
- Equity and Justice
- Environmental Consciousness
- Personalized Service
- Adoption of Changed Technology
- Proper Delegation, Transparency & Accountability
Product of IBBL:
Al-Wadeah Current Account (AWCA):
Al-Wadeah current account consists of cost free deposit. Currrent account is most suitable for private individuals, traders and businessperson, where quires frequent transaction with the bank account. For opening current account minimum initial deposit requirement is BDT 5,000. No profit is given against the deposit in this account. IBBL offers following facilities against this account:
- Any number transaction in a day.
- Statement of account at any desired frequency.
- On-line banking
- Phone banking
Mudaraba Savings Account (MSA):
This type of account is conducted under mudaraba principle of Islamic Shariah. This account may be opened in single or joint name of the person(s) or any organization acceptable to the bank. This deposit is basically meant for small scale severs. That is authorized to invest the mudaraba funds at risk of depositors. There is restriction on frequent withdrawals. In addition, it is allowed only against prior notices. Generally minimum amount require for initial deposit is BDT 1,000. Monthly withdraws not more than 4. 7 days noticed withdraws of a large sum.
Mudaraba Special Notice Account (MSNA):
This account is also conducted under mudaraba principles. The very special character of this account is 7 days periods notices for any withdrawal. Government organization, big corporate house and Bank are generally the client of this account. 5.5% generally profit, but may increase to 6% or more depending on the fund. The volume of this account is generally large and notice has to be draw money.
Mudaraba Term Deposit Receipt (MTDR):
Generally, mudaraba term deposit account is accepted in different tenure 3, 6, 12, 24&36 months. No withdraws facilities is allowed here. However, the depositor may enjoy premature encashment facility or may avail ‘Quard’ against of MTDR as per norms of the bank. If the client encases the MTDR before 3 months, no profit is allowed. MTDR is not enchased within 1 month of maturity date; it is automatically renewed for a future same period.
Mudaraba Hajj Savings Scheme (MHS):
IBBL has introduced a schame in the name and style of MHS A/C to facilities the intending muslims to perform Hajj properly at appropriate age. Any muslim intending to perform Hajj can open this account. Hajj expense and may select 25 alternative choices based on duration of period from 1 year to 25 years. The bank accepts deposits on installment basis under mudaraba principle. Bank gives here the highest weightage are 1.30 upto 10 years.
Mudaraba Savings Bond Scheme:
This bond is issued under mudaraba principle of Islamic Shariah. The denominations of the bond are BDT 5,000, 10,000, 25,000, 50,000, 100,000, 500,000 & 1,000,000 only for 5years and 10years terms.
Mudaraba Special Savings (pension) Account (MSS):
IBBL has introduced such scheme so that a person can get opportunity to build-up savings by contributing small monthly installments for getting an attractive amount at the end of specific term of maturity. Generally, the terms of maturity are 5years and 10years. Under this account may be opened for monthly deposits of BDT 100 200 500 1,000 and multiple of thousand of BDT 2,000 upto 20,000 only.
Financial Performance of last Few Years:
Amount in Million Taka
|11||Investments Deposit Ratio||87.13%||89.08%||87.85%||90.17%||89.47%|
|12||Amount of Classified Investment||4246.02||4311.13||5063.40||4,655.63||8,292.32|
|13||Classified Investment to total Investment (%)||2.93||2.39||2.36||1.77||2.71|
|14||Provision against Classified Investment||1703.13||1883.43||2490.00||1,840.00||3,054.00|
|15||General Provision against Unclassified Investment||2005.72||2315.74||2700.00||3,443.00||3996.00|
|16||General Provision on Off Balance Sheet Items||291.15||570.83||510.00||930.00||1,120.00|
|20||Total Foreign Exchange Business||287919||402695||462370||609,331.00||716,058.00|
|23||Income from Investment||14856.19||19952.59||21485.69||24,766.26||32,019.53|
|24||Net Profit before Tax||3780.82||6347.83||6517.66||8,454.71||10,347.31|
|25||Net Profit after Tax||1427.36||2674.80||3403.55||4,463.47||4,841.45|
|26||Payment to Govt. (Income Tax)||2385.44||3245.08||3253.23||4,108.90||5,515.56|
|28||Total Asset (including Contra)||250012.79||288017.19||340638.49||443,684.79||502,613.05|
|29||Total Asset (excluding Contra)||191362.35||230879.14||278302.84||330,586.12||389,192.12|
|31||Total Contingent Liability||58650.44||57138.05||62335.65||75,254.23||86,114.00|
|33||Number of Correspondent Bank||265||275||295||295||313|
|34||Number of Foreign Correspondent||884||906||919||919||935|
|35||Number of Shareholders||26488||33686||52164||58,923||60,550|
|36||Number of Employees||8426||9397||9588||10,349||11,465|
|37||Number of BRANCHES||186||206||231||*251||*266|
|38||Book Value Per Share (Taka)||236||228||325||238||263|
|39||Cost of Fund (%)||9.06||9.56||8.76||8.65||8.56|
|40||Cost Income Ratio||0.79||0.72||0.74||0.72||0.73|
|41||Return on Equity (ROE)%||13.00||19.02||16.93||19.00||17.42|
|42||Return on Asset (ROA)%||0.84||1.27||1.34||1.47||1.35|
|43||Earnings Per Share (Taka)||3.00||4.33||4.59||4.46||4.84|
|44||Market Value Per Share (Taka)||70.00||83.00||89.00||90.00||83.98|
|45||Price Earning Ratio (Times)||17.88||10.78||10.73||13.29||11.27|
|46||Price Equity Ratio (Times)||1.69||2.05||1.82||2.52||1.96|
Social Welfare Oriented Special Investment Schemes of IBBL:
Household Durable Investment Scheme:
In a developing country like Bangladesh people of middle and lower class especially service holders with limited income find it difficult to purchase articles like refrigerator, television, cot, almirah, wardrobe, sofa-set, pressure cooker, sewing machine etc. which are part of modern and decent living. They cannot enhance the standard and quality of life to the desired level due to the constrain of their limited income. Islami Bank Bangladesh Limited has, therefore, introduced Household Durables Investment Scheme that has already created great enthusiasm among the people and received tremendous response from them.
Aims and objectives:
- To assist service holders with limited income in purchasing household durables.
- To assist the fixed income group in raising the standard of living.
- To create opportunity for the service holders to enjoy the benefit of modern and sophisticated living and at the same time lead a decent and honest life.
Housing Investment Scheme:
One of the basic human needs is to have a house to live in. A house is an abode of peace and happiness. Housing has now become an acute problem in the country, especially in the towns, cities and metropolis. With their limited income, it has become almost impossible on the part of the lower middle class, middle class and sometimes, even for upper middle class to solve their housing problem. To meet this basic human need, Isalmi Bank Bangladesh Limited is committed to contribute to this end to provide a peaceful and happy living. The Bank has introduced “Housing Investment Scheme” with the objective to ease and minimize the housing problem and assist service holders and professionals with limited income in materializing their dream of becoming owner of housing.
Aims and objectives:
- To extend the benefits of the investment of the Bank under the Scheme to different sections of the people.
- To assist in solving the existing housing problem of the country.
- To assist the service holders and professionals with fixed income to arrange for house of their own.
Real Estate investment Program:
Professionals, Service-holders, Businessmen, Real Estate developer and other categories of people who are not entitled for availing investment facilities under Housing Investment Scheme, shall be eligible under this program. Investment is to be extended to build new houses and for extension / completion of the house already constructed, commercial building, shopping complex, flat/apartment etc.
Transport investment Program:
The role modern communication is most vital for the socio-economic growth and uplift of a developing country like Bangladesh. In this backdrop the demand for road and water transport has increased manifold throughout the country Considering all these facts, Islami Bank Bangladesh Limited has introduced ‘Transport Investment Scheme’ Under this scheme investment on easy terms is being extended to the existing successful businessmen in road and water transports and potential entrepreneurs in this sector for different types of road and water transport. Besides, Multinational companies, established business house and well to do officials and professionals can become owner of various kinds of transports through Hire Purchase under scheme.
Aims and objectives:
- To assist in the development of communication system of the country.
- To help overcome the existing transportation problem.
- To assist solvent service-holders and professionals having fixed income for acquisition of private cars and thus to help them to improve their professional efficiency and the standard of living.
Rural Development Scheme:
Islami Bank Bangladesh limited (IBBL) envisages an economic system based on equity and justice. Taking into consideration that majority of the population below poverty line lives in rual Bangladesh, the Bank has devised a Rural Development Scheme (RDS) with a view to creating employment opportunity for them and alleviates their poverty through income generation activities.
The IBBL through its RDS project has been implementing integrated programs for the landless poor, eage laborers and marginal farmers aimed at meeting their basic needs and promoting their comprehensive development. Consciousness among the poor needs to be enhanced so that they can firm ups their position in the socio-economic structure of the country. In order to consolidate their economic base, invested money should be used in income generating activities so the poorer section of the population can become self-reliant. RSD works for the realization of that objective.
Aims and objectives:
- To extend bank investment to agricultural and non-agricultureal sectors in the rural areas.
- To invest on employment and income generation activities of the rural population.
- To provide self-employment for distressed people.
- To provide self-employment for the poor and distressed by group/center formation.
Small Business Investment Scheme:
Bangladesh is a third-wood developing country is rich in natural and human resources. Inspite of vast po–sibilities, the majority people of the country livein hardship-below poverty tapped, explored and exploited. Physical labour is their only means of earning. A large segment of this populace is active youth force. Many of them are efficient, intelligent and energetic with initiative & drive and have courage to tale risks. But they can not uplift their socio-economic condition due to poverty, lack of financial support and other required facilities. Lack of capital compelled many small traders to leave their profession. As a result in our country not only unemployment problem increased but also the young generation is involved in anti-social activities; thus creating threat to the social life.
Aims and objects:
- To expand investment facilities for the small traders entrepreneurs in urban and rural areas with a view to rasie their level of income and to improve their quality of life.
- To inspire and encourage unemployed youths to establish small business enterprises and thereby to create opportunities for self-employment for ensuring social justice and welfare of the people in large scale.
- To extend investment facilities to those small entrepreneurs who could not avail credit or investment facilities from any bank or financial institutions or otherwise depried of from such investment facilities.
Agricultural Implements Investment Scheme:
Bangladesh is predominantly an agricultural country with vast majority of people living in rural areas. Most of our people for their living. are dependent on agriculture . Agriculture still contributes the lion share of the gross domestic product. But we could not as yet become self-sufficient in food production. We still import a bulk quantity of food grains from abroad to meet the deficit. This reliance on others. We must modernise our agriculture and establish more and more industries in order to minimise imports.
We can bring about revolutionary changes in the agricultural sector by adopting modem agricultural technology replacing the age-old traditional way of cultivation and increasing the use of fertilizer. This can only be done by collective efforts of both public and private sectors.
Islami Bank Bangladesh Limited is a welfare oriented Bank. It can play positive and important role in the economic development, progress and uplift of the country by investing in the agricultural sector. The Bank has, therefore, introduced ” Agriculture Implements Investment Scheme” to provide power tillers, power pumps, shallow tubewells, thrasher machine etc. On easy terms to the unemployed youths for selfemployment and to the farmers to help augment production in agricultural sector.
Aims and objectives:
- To create opportunities for self-employment of un-employed rural youths.
- To help farmers to augment agricultural production.
- To assist in the introduction and use of modern technology in the agnculral sector.
- To play auxiliary role in achieving self-sufficiency in food production.
Items of Agricultural Implements:
- Power tillers
- Power pump
- Thrasher Machine
- Shallow Tubewell
- Any other agricultural implements proposed by the branch and which has local demand.
These implements may be of any popular brand. Any locally manufactured brand, which has large demand, is also acceptable. The choice of investment clients shall be given preference in this regard.
Micro Industries Investment Scheme:
Bangladesh is a developing country has been trying for its overall economic growth. One of the major problems confronting its growth is lack of development of enterprises and potential entrepreneurs who can create more job opportunities by establishing new enterprises in the industrial sector. There are a number of educated unemployed youths and also skilled & semi skilled unemployed persons in the country. Besides, every year quite a good number of youths are coming out of the general/technical educational institutions to add to this already crisis ridden employment market. Development programs and efforts will bring no meaningful result unless and until income-generating employment opportunities can be created for the growing number of unemployed people including the educated unemployed youths. Establishment and expansion of micro industries can play a vital role in creating more employment opportunities as well as in the overall socio-economic development of the country.
Islami Bank Bangladesh Ltd. has been appreciably participating in this direction by financing industrial sector. With a view to creating wider base for industries, the Bank has decided to launch “Micro Industries Investment Scheme” through its Branches. This scheme has been devised to cater to the investment needs of those persons who intend to set-up new micro industrial ventures or to restructure their old units by way of BMRE involving a total cost of Tk. 5.00 lac.
This is intended mainly to create new jobs for the educated, skilled & semi skilled unemployed and also to encourage those who remain outside the purview of investment due to shortage of funds and insufficient collaterals. The scheme has been prepared with easy terms and conditions to encourage the small entrepreneurs, educated unemployed youths and skilled/semi skilled persons to come forward for establishment of micro industries commensurate with the local demand.
Aims and objectives:
- To create income generating employment opportunities through establishment of new micro industries and BMRE of existing units by providing necessary investment facilities.
Loans and Investment:
Features of Loans:
Conventional Banks advance money in exchange for a pre-determined fixed rate of interest. That is under the conventional banking system, every advance made by a bank is a contract between the bank and the client with the following essential features:
- A creditor-borrower relationship is established.
- The lending and borrowing is time bounded qualifying specific date on which a certain percentage of interest or borrowed capital becomes due for payment along with the principal and interest.
- The income of the bank is known and pre-fixed and not in any way related to or variable with the income of the borrower from the borrowed money.
Features of Investment:
On the other hand, financing arrangement under the profit loss sharing system of Islamic banks has the following features:
- It is a contract between two partners the bank and the client providing a partnership relationship.
- The contract is time bound in the sense that the client has to return the capital on/within specific date. However the return of the bank is not fixed either from the standpoint of time or that of the rate.
- Bank shares a pre fixed ratio of profit expressed in percentage terms. This is not a pre fixed rate of return calculated on capital advances. Thus income from a PLS bank, unlike the practice of its conventional counterpart, fluctuates with the profit of the borrower.
In summary, in conventional banking the bank is simply a financer and is not directly concerned about the success or failure of the project for which the loan was made, as long as it receives its payments. This is so because the bank’s income (Interest income) does not fluctuate with the fluctuation of income generated from the specific project. In other words, conventional banks make advance financing in return for a guaranteed fixed return. On the other hand, a PLS bank has a high interest in the performance of each project it finances because its income is directly related to the returns from each project it finances.
Difference between Bai Murabaha and CC Pledge:
|Here the goods for which investment is allowed must be purchased and stored.||In this system bank may allow loan against any pre stored goods or the client can store any goods covering the bank’s loan as he desire. Buying and selling is not necessary here.|
|Investment is allowed against only those items which are permissible as per Shariah and law of the land.||Compliance of Shariah law is not at all mandatory.|
|Bai Murabaha involves three parties i.e. the Bank, Client and Supplier.||CC Pledge involves two parties i.e. the Bank and the Client.|
|Profit once fixed can not be increased in any way.||They charge compound interest on quarterly basis.|
Riba (Interest) and Profit:
Riba and its basic features of Riba:
The word used by the Quran concerning ‘interest’ is Riba. The literal meanings of Riba are money increase, increase of anything or increment of anything from its original amount. However, not all increases are considered as Riba in Islam. Money may increase in business activities as well. This increase is not at all considered as Riba.
The increase, instead of being prohibited (Haram), is approved (Halal) in Islam. Islam prohibits only those increases that are charged on the loan with a prefixed rate.
Muslim scholars equate interest with Riba. In the Shariah, Riba technically refers to the premium that must be paid by the borrower to the lender along with the principal amount as a condition for the loan or for an extension in its maturity. In other words, Riba is the predetermined return on the use of money. In the past there has been dispute about whether Riba refers to interest or usury, but there is now consensus among Muslim scholars that the term covers all forms of interest and not only “excessive” interest.
In the era of Ignorance (Jahiliah), moneylenders in Arabia charged a prefixed extra amount on their money lent out. Some of them lent goods or crops and took back prefixed extra amount on and above the principal amount. In those days, the extra amount charged on the principal amount of money or goods was also termed as Riba.
Imam al Rajhi describes, “During the era of Jahiliah people invested their money and charged Riba on a monthly basis, though the invested amount remained unchanged. Money so invested was called back at the time of repayment. In case of the borrower being unable to pay back, the lender extended the period of repayment enhancing the amount to be paid on and above the principal amount.” Abu Bakr al Jasas writes, “During the period of Ignorance the lender and borrower came to an agreement that the borrower would pay back within a specified period the principal amount along with the agreed upon excess.” Ibne Hajar Askalani says, “Excess goods or money charged on and above principal is Riba.” Thus, any prefixed extra amount charged on a specific amount of money or goods lent out is called Riba.
In other words, when money begets money, without being exchanged for goods or services, it is called Riba.
Its basic characteristics are:
- It must be related to loan;
- A prefixed amount of money to be paid when due;
- A time is fixed for the repayment; and
- All these elements for repayment are taken as conditions for loan.
3.4.2 Riba and Profit:
There are persons who try to equate Riba with profit. In effect, they are fundamentally different from each other as can be seen from the following:
|1. When money is “charged”, its imposed positive and define result is Riba||1. When money is used in trading (for e.g.) its uncertain result is profit.|
|2. By definition, Riba is the premium paid by the borrower to the lender along with principal amount as a condition for the loan.||2. By definition, profit is the difference between the value of production and the cost of production.|
|3. Riba is prefixed, and hence there is no uncertainty on the part of either the givers or the takers of loans.||3. Profit is post-determined, and hence its amount is not known until the activity is done.|
|4. Riba can not be negative, it can at best be very low or zero.||4. Profit can be positive, zero or even negative.|
|5. From Islamic Shariah point of view, it is Haram.||5. From Islamic Shariah point of view, it is Halal.|
3.4.3 Prohibition of RIBA:
184.108.40.206 on religious perspective:
The religious restriction on interest is quite explicit and unequivocal. All transactions based on Riba are strictly prohibited in the Quran. The prohibition of Riba appears in the Quran in four different revelations. The first of these [30:39] in Makkah, emphasized deprivation of God’s blessing for a man making interest transaction and charity having the essence of manifold rise. The second revelation [4:161] concerning the subject took place in the early Madinah. It severely condemned interest-referring prohibitions taken place in the previous scriptures. The third revelation [3:130-2] enjoined Muslims to keep away from Riba. The fourth revelation [2:275-81] reveling nears the completion of the Prophet’s mission. The verses giving strong verdict against Riba are as follows:
Those who devour Riba will not stand except as stands one that the devil hath driven to madness by [his] touch [2:275].
Condemnation of the system of interest is so strong and without any doubt can be reflected in the following verse which imposes penalties on those who hesitate in observing the verdict: O ye who believe! Observe your duty to Allah and give up what remains (due to you) from Riba, if you are (in truth) believers. Moreover, if you do not, then be warned of war (against you) from Allah and His Messenger. In addition, if you repent then you have your principal (without Riba). Wrong not, and you shall not be wronged [2:278-9].
The strong disapproval of interest by Islam and the crucial role it plays in the modern commercial banking has led Muslim thinkers to explore ways and means by which commercial banking could be organized on an interest-free basis. However, for a long time, the idea of Islamic banking remained a mere wish. Some papers were written and some professional economists even worked out theoretical models of Islamic banking. However, they were quickly dismissed by highbrow economists who described them as wishful thinking and attempts to put history into reverse gear.
on socio-economic perspective:
The Islamic law of prohibition of interest was originally not based on economic theory but on divine authority, which considered charging of interest as an act of injustice. Early Muslim scholars considered money as a medium of exchange, a standard of value and a unit of account but rejected its function as a store of value. Lending upon interest was prohibited because it was an act of ungratefulness and considered to be unjust since money was not created to be sought to be itself but for other objects.
Recent Muslim scholars, however, place the major emphasis of their explanation of the Law on the lack of a theory of interest. They have countered the arguments that interest is a reward for saving, a productivity of capital and an inevitable consequence of the difference between the value of capital goods today and their value a year hence. The basic arguments are summarizes below:
Interest and savings: To the argument that interest is a reward for saving, Muslim scholars (see, for example, Mirakhore 1995, pp.31-34) respond that such payments could only be rationalized if savings were used for investment to create additional capital and wealth. According to them, the mere act of abstention from consumption should not entitle anybody to a return.
Interest and the productivity of capital: To the argument that interest is justified as productivity of capital, they respond that although the marginal productivity of capital may enter as one factor into the determination of the rate of interest, interest, per se, has no necessary relation with the capital productivity. Interest, they argue, is paid on money, not on capital, and has to be paid irrespective of capital productivity. In distinguishing between interest as a charge for the use of money and a yield from the investment of capital, Muslim scholars argue that it is an error of modern theory to treat interest as the price of, or return for, capital. Money, they argue, is not capital, it is only ‘potential capital’ which requires the service of the entrepreneur to transform the potentiality into actuality; the lender has nothing to do with the conversion of money into capital and with using it productively.
The elimination of interest from the economic system is intended to promote economically just, socially fair and ethically correct dealings according to Islamic principles. This harmonious trade creates powerful economic incentives, and brings about co-operation and co-participation in all walks of life. Moreover, prohibition of the practice of hoarding in the Quran applies to money also. Islam wants to make it sure, that one’s money is used productively for oneself and the community.
Corporate Social Responsibilities of IBBL:
Bangladesh Bank issued a circular No. DOS. 01 dated 1 June 2008 regarding guidelines for mainstreaming Corporate Social Responsibility (CSR) in banks and financial institutions. Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) also formulated the same as their Governance Standard No.7 of which IBBL is obliged to follow as the member of their charter. Islami Bank Bangladesh Limited being one of the most important corporate citizens of the country, has been discharging its responsibilities to the society in general, both directly through its mainstream operations as well as indirectly through its fully owned subsidiary ‘Islami Bank Foundation since inception.
As per guidelines of the Central Bank, CSR practices of the Bank are categorized as follows:
- CSR practices within the organization.
- Scrutinizing environmental and social impact of the projects financed/to be financed by the Bank.
- Reaching out with financial services to the less fortunate segments of the Community.
- Community investment by way of donations.
- Performance of the Bank in above 4 (four) categories are detailed below:
CSR practices within the organization:
Islami Bank Bangladesh Limited (IBBL), a first generation private commercial bank of the country having 231 Branches including 20 SME/Agriculture Branches, is discharging a major social responsibility by creating employment opportunities for its 9,588 employees. The employees are also ensured with healthy working environment and financial securities. A brief of the social and financial securities are mentioned below:
- The recruitment process of the Bank strictly follows “IBBL Recruitment Policy” and maintains transparency in all stages to protect the right of the eligible candidates and the interest of the Bank without discriminating gender, race or socio-economic background.
- Every year a good number of eligible employees get promotion to the higher rank. Promotions are awarded on merit basis regardless of gender, race or socio-economic
- A good pay-package has been provided to the employees of the bank. Ratio of the pay between highest& lowest regular rank is only 14:1.
- Contributory ‘Provident Fund’ and Gratuity are there for the employees of the Bank. ‘Benevolent Fund’ is also there for providing emergency financial assistance to the employees. A ‘Superannuation Fund’ has been established for ensuring economic security to the family of the employees in case of death in harness, disability and retirement.
- To mitigate the housing problem of the employees, the Bank has introduced ‘House Building Investment Scheme’ for the employees.
- The Bank maintains the leave policy for the employees complying with the relevant laws of the land as well as the guidelines of the Central Bank. Leave encashment facilities are also there for the employees.
- Full time transport facilities are provided to SVP & above ranked executives. Executives in the rank of VP and above are also provided with car under “Car Scheme for the Employees of the Bank”.
- Liveries and uniform are provided to the sub-staffs every year. They are also provided with overtime bills for working after office hours.
Scrutinizing environmental and social impact of the project financed/to be financed:
- IBBL especially concern about the impact of Bank’s financed projects on environment. An environmental policy has been formulated in accordance with guideline issued by the Government. As per policy, environmental impacts are duly considered during new project investment appraisal and during the continuation of the projects.
- IBBL has around 1150 industrial projects located into 19 different industrial sectors. To ensure green industrialization, our practice is to take clearance from the Department of Environment of the Government before giving sanction to any new project. We take all possible care to protect the environmental pollution by our sanctioned rejects. In this regard we encourage to establish ETP to the projects like dyeing, printing etc, 120 feet chimney for the brick fields.
- We assure NOC of various authorities such as, Explosive Department, Fire Services Department, Rupantorito Prakritic Gas (CNG) Company etc. for setting up gasoline/CNG filling station.
- The industrial clients of the Bank are being motivated on regular basis in scrutinizing the environmental and social impact of their projects and also to take mitigating measures for negative impact, if any and supporting measures for favorable impact.
- IBBL motivates the investment clients to do their best for their employees, to ensure healthy working environment in their establishments and to develop fellow fillings.
- Besides, IBBL observes ‘Plantation Week’ every year during the rainy season to encourage the people planting more by providing saplings free of cost to the beneficiaries of Rural Development Scheme (RDS), the micro-investment scheme of the bank.
Reaching out with financial services to the less fortunate segments of the community:
Islami Bank Bangladesh Ltd. has devised following deposit and investment products for the less fortunate segment of the country as part of CSR activities of the Bank under its mainstream banking portfolio:
CSR in portfolio: deposit:
- Customers are allowed to open and maintain savings A/C’s with tk.100/- only. This is a rare example in the privet sector banking arena.
- The rural poor are encouraged to make savings at least Tk 10/- per week and are allowed to maintain ‘Mudarabah Savings Account (RDS) with the Bank.
- It allows opening Mudaraba Special Savings Scheme (Pension Scheme)’ with a minimum monthly installment of Tk.1 00/- only.
- Mudaraba Mohr Savings Scheme’ has been developed to help safeguarding the interest of married women.
- ‘Mudaraba Cash Waqf Deposit Scheme’ is designed to encourage the well-off to contribute welfare activities.
- ‘Mudarabah Monthly Profit Deposit Scheme’ is designed especially for the retired people or their families for comfortable sustenance.
CSR in investment portfolio:
Looking into the genuine requirement of the poor and fixed income earner group of people in the country the following specialialized Schemes have been introduced:
- Household Durables Scheme (HDS): The objective of the Scheme is to increase standard of living and quality of life of the fixed income earner group by extending investment facilities for purchasing household articles.
- Housing Investment Scheme (HIS): The Bank has introduced the Scheme to ease the serious housing problem in the urban areas and to make arrangement for comfortable accommodation of the fixed income earner group.
- Small Business Investment Scheme (SBIS): The Scheme has been taken up for self- employment of educated youths and to provide investment facilities to small businessmen and entrepreneurs without collateral security.
- Agriculture Implements Investment Scheme (AIIS): This Scheme has been introduced to provide power-tillers, power pumps, shallow tube wells, thresher machines etc. on easy terms to the unemployed rural youths for self-employment and to the farmers to help augment production in agriculture sector.
- Rural Development Scheme (RDS): the objective of the Scheme is to create income generating and productive self-employment opportunities through extension of security- free micro investment facilities to agriculture and off-farm activities in the rural areas and thereby to contribute in alleviating rural poverty. The poor beneficiaries are also provided with health and education support under profit-free Quard Scheme.
- Micro Industries Investment Scheme (MIIS): to encourage establishment of micro-industries in different areas of the country by the potential entrepreneurs and for diversification of the Banks investment portfolio, the Bank introduced ‘Micro-Industries Investment Scheme.
- Investment Scheme for Doctors (ISD): The Bank has taken up this Scheme to help unemployed qualified doctors to go for self-employment and to get them involved with medical services in the rural and semi-urban areas of the country.
Performance of the above seven (seven) schemes up to 31-1 2-2011:
(Amount In million taka)
|No. of existing client||18,864||445||22,051||258||3,1 2,036||23||53||3,53,730|
SME Investment: Since SME is being considered as the engine of growth in any economy around the world, the Bank have encouraged investment in SMEs from very beginning and has introduced several investment schemes to cater the needs of SME. Bank’s investment in this sector as on December 31, 2011 is shown below:
|SME type||No. Of accounts||Amount in million taka|
3.5.4 Community investments by way of donations:
IBBL operates various welfare activities directly and through “Islami Bank Foundation (IBF)”, a full fledged corporate social responsibility wing of the Bank, During various natural disaster, IBBL came forward with relief activities for the victims directly and through donating into government funds (Prime Minister’s/Chief Advisor’s fund). After the recent BDR massacre, IBBL sponsored four martyred army families for their family expenditure for the period of next 12 years @ Tk. 40,000/- per month per family.
Under its education support program, IBBL awards scholarship among the meritorious wards of the Bank officials and the meritorious students of Banking & Finance Department of Dhaka University, Chittagong University and Manarat International University.
SOCIAL SERVICES THROUGH ISLAMI BANK FOUNDATION
As a responsible corporate citizen, IBBL is playing a vital role for development of the society through Islami Bank Foundation. The Foundation was established for providing financial assistance to the poor and needy people through various income generating healthcare, relief and rehabilitation, education, humanitarian, dawa and special programs. A brief summary of activities of Islami Bank Foundation is given bellow:
HEALTH CARE SERVICES
Islami Bank Hospitals
Six Islami Bank Hospitals have been functioning with good reputaion: two in Dhaka, two in Rajshahi, one in Khulna and one in Barishal, extending facilities in the field of medicine, surgery, gynae, pediatric, E.N.T, urology, neurosurgery, skin, eye, orthopedic,cardiology etc. at a cost within the reach of common people. In the year 2010 and 2011 a total number of 5,53,084 and 6,24,835 patients respectively received treatment facilities from Islami Bank Hospitals.
Islami Bank Community Hospitals
The activities of seven Islami Bank Community Hospitals at Satkhira, Manikganj, Rangpur, Faridpur, Jhenaidah, Dinajpur and Naogaon are going in full swing. Four more Community Hospitals are going tobe started soon in Madaripur, Noakhali, Mymensing and Feni. In the year 2010 and 2011 a total number of 75,967 and 1,24,080 patients respectively received treatment facilities from Islami Bank Community Hospitals.
Low Cost Eye Treatment Project
A good number of people have been suffering from various eye diseases, but due to non-availability of eye specialists specially in the rural areas, they can not receive proper treatment. Financial inability is one of the important factors and for this reasons many poor people cannot receive proper eye treatment facility. Keeping in view of the above, Islami In the year 2010 and 2011 a total number of 2,500 and 3,000 patients respectively received eye treatment through low cost eye treatment project arranged by Islami Bank Foundation.
Circumcision (Sunnat-e-Khatna) Camp
Circumcision (Sunnat-e-Khatna) is an important sunnah for the Mushlims. In the age modern science, it has been considered essential for men health. Islami Bank Foundation is running this noble program of circumcision of the children of poor, needy and helpless people with the help of lsalmi Bank Hospitals and Islami Bank Community Hospitals. In addition to this free circumcision (Sunnat-e-Khatna) program, Islami Bank Foundation distributes Lungi and Guernsey to the poor children as token gift. In 2011, Islami Bank Foundation circumcised total 2,550 children.
Islami Bank Foundation has been running a good number of charitable dispensaries in rural areas in different parts of the country. Some of the charitable dispensaries rendering allopathic treatment where the others are rendering homeopathic treatment. Usually qualified doctors gives prescription to the patients once or twice in a week without any fee. The patients are also given necessary medicine free of cost. In the year of 2010 and 2011 a total number of 1,48,200 and 1,65,000 patients respectively received treatment facilities through the charitable dispensaries.
Islami Bank Homeopathy Clinic
To render homeopathy treatment facilities to the common people, specially to the poor section of the society Islami Bank Foundation has, therefore, established a homeopathy clinic with qualified doctors at Mirpur, Dhaka. Islami Bank Foundation has planned to establish more homeopathy clinics in different parts of the country gradually. A total number of 2,953 and 4,551 patients respectively received treatment facilities from Islami Bank Homeopathy Clinic in the year 2010 and 2011.
Islami Bank Medical College
The activities of Islami Bank Medical College, Rajshahi is going on satisfactorily. The classes of students from 1st batch, 2nd batch, 3rd batch, 4th batch, 5th batch, 6th batch and 7th batch are running in full swing. The construction work of the hospital building and the academy building has been completed. A total of 307 and 317 students were studying in the college in the year 2010 and 2011 respectively and 1 3students have already passed the MBBS degree.
Islami Bank Nursing Training Institute
In hospitals /clinics, the role of nurses is very important. There is a great dearth of qualified nurses in our country and, therefore, quality treatment services is being hampered to a great extent. Keeping in view the above situation, Islami Bank Foundation has established a nursing training institute in Rajshahi to create opportunity of respectable employment of the youths as well as to meet the increasing the demand of the qualified nurses. A total number of 80 students were studying in the institute in the year 2011.
Islami Bank Health Technology Institute
Proper diagnosis of diseases is very important to render accurate treatment facilities to the patients. In our country there are a good number of hospitals/clinics and diagnostic centers but most of them do not have necessary qualified technical manpower to do pathological test, radiological test etc. Moreover, for this reason the patients have to suffer frequently due to wrong diagnosis of diseases. Islami Bank Foundation has therefore established a health technology institute in Rajshahi in the name and style of “Islami Bank Institute of Health Technology. In the meantime, govt. has given approval to introduce 4-year diploma courses in the institute a total number of 185 students were studying in the institute in the year 2011.
Midwifery Training Program
In the rural areas, the traditional birth attendants conduct the normal delivery. They do not have any formal training in this regard, and, therefore, a good number of mothers and babies die during the delivery. Many of them, though do not die, suffer even the whole life due to wrong handling of the traditional birth attendants. Considering the above situation Islami Bank Foundation has taken ‘Midwifery Training Program’ with the help of Islami Bank Hospitals and Islami Bank Community hospitals. In the year 2011, a total number of 300 traditional birth attendants received midwifery training.
Islami Bank Institute of Technology
Six units of Islami Bank Institute of Technology (IBIT) two in Dhaka, one in Bogra, one in Sylhet and another in Chittagong have been working satisfactorily to train up the unemployed youths to make them self-reliant and for technological advancement of the country. In the meantime, IBIT Dhaka (2 units), Chittagong, Sylhet and Bogra have got the affiliation of Bangladesh Technical Education Board. In the year, 2010 and 2011 a total number of 1,598 and 1,254 students respectively were studying in the IBITS.
Islami Bank International School and College
As Dhaka, the capital of Bangladesh, is turning a mega city, a large number English medium school is creeping up which follows curriculum not conforming fully to the need of the country. As an attempt to combine modern education with moral values for a total development of the children, Islami Bank Foundation has established an English medium international school and college at 147, Green Rood, Dhaka. In the year, 2010 and 2011 a total number of 335 and 348 students respectively were studying in the school.
Islami Bank Model School and College
Islami Bank Model School and College is one of the important projects of Islami Bank Foundation. To render modern education with moral values the activities of the school has been started at Mirpur, Dhaka. A qualified and experienced Head Master has been appointed. In the year, 2010 and 2011 a total number of 342 and 348 students respectively were studying in the school.
lslami Bank Mohila Madrasha
Islami Bank Mohila Madrasha is another important project of Islami Bank Foundation. To render religious education with moral values combining the essential education for the world the activities of the madrasha has been started at Mirpur, Dhaka. A qualified and experienced Vice Principal has been appointed. In the year, 2010 and 2011 a total number of 65 and 76 students respectively were studying in the madrasha.
Scholarship program is one the important programs of Islami Bank Foundation. Under this program, scholarships are being given to the students of College, Madrasha and universities at home and abroad. Moreover, scholarship is being offered to the researchers to obtain M.phil and phd degrees. In the year, 2010 and 2011 a total number of 420 and 433 persons respectively received scholarship from the foundation.
Model Forquania Maktab
Model Forquania Maktab project is one of the important projects of Islami Bank Foundation. In the Rural areas, the Maktabs are being managed where the children are learning the Quran as well as English and Bengali alphabets and elementary knowledge of English and Mathematics, which are helping them a lot to read in the School and Madrasha. In the year, 2010 and 2011 total 26,367 and 26,600 students respectively were studying in the forquania maktabs.
Bangladesh Sangskritic Kendra
To save our youth force from derailment, it is essential to uphold and promote the culture, which is of our own. Keeping in view the above, Islami Bank Foundation has established Bangladesh Sangskritic Kendra in Dhaka and Rajshahi and establishment of other centers is under process.
Islami Bank Women Rehabilitation Centre
As part of service to the distressed humanity Islami Bank Foundation has established a centre for shelter, training and rehabilitation of the unfortunate, distressed, shelterless widows and divorced women in the name of “lslami Bank Women Rehabilitation Centre” at Mirpur, Dhaka. A total number of 30 and 28 distressed women respectively received training facilities and rehabilitated in the year 2011 and 2010.
Islami Bank Service Centre
Seven Islami Bank Service Centres at (i)Noakhali (ii) Manikganj (iii) Feni (iv) Chandpur (v) Saint Martin (vi) Satkhira and (vii) Chapainawabganj were established to enhance the socio-economic condition of the poor and needy people of the coastal and river belt area in addition to providing safe shelter during natural calamities. A total number of 388 and 348 group members received investment facilities from the service centres during the year 2011 and 2010 respectively.
Findings of the study:
The social welfare oriented special investment schemes in IBBL have been implemented and being expanded to meet the specific welfare oriented needs of the different segments of people of the country. The bank since its inception, has been working for the enlistment and emancipation of the under privileged downtrodden and neglected sections of the population and has take up various for their well-being. Islami Bank Bangladesh Limited being one of the most important corporate citizens of the country has been discharging its responsibilities to the society in general, both directly through its mainstream operations as well as indirectly through its fully owned subsidiary ‘Islami Bank Foundation since inception.
Table: IBS at a glance in Bangladesh, 2011
|SL||Bank Name||Estimated||Branches||Paid in CapitalIn Million(Tk.)||ProfitIn Million(Tk.)||Options|
|01||Islami Bank Bangladesh Ltd||13th March 1983||276||10007.71||10347||Education, Sports, Pilkhana, Health, Technical Trading.|
|02||First Securities Islami Bank Ltd||25th October 1999||93||3400.32||7900||Trading, Agriculture, Manufacturer|
|03||Export-Import Bank Ltd||1999||65||9223.56||4000||Industrial, Agricultural, Transportation, Export, IBB|
|04||Social Islami Bank Ltd||1989||45||200.58||5900||Health, Agricultural, Education, Industrial|
|05||Al-Arafha Islami Bank Ltd||18th June 1995||100||10000||470.65||Housing, Agricultural, Industrial|
Brief findings of IBBL:
- IBBL is playing a vital role for development of the society through Islami Bank Foundation.
- The Foundation was established for providing financial assistance to the poor and needy people through various income generating healthcare, relief and rehabilitation, education, humanitarian, dawa and special programs.
- IBBL Medical system is not enough modernized like other well-known hospitals.
- IBBL should provide more Scholarship not only for the poor student but also for the middle class Student.
- There are only seven-service centre of Islami Bank Service Centre. They should increase this number for better welfare.
- For our culture, Islami Bank should launch cultural centre.
- IBBL should establish few more new School and college on Islamic based.
- Household Durable Scheme, It is a good investment scheme of IBBL, but it seems to me that the rate of return is high i.c: 19%, which is complicated to pay back.
- IBBL should invest more in the medical profession to increase the number of specialized doctors.
- IBBL should provide more social welfare activities to the rural area of the country.
- IBBL should provide investment in simple and easier way so that people can show interest to take investment.
- IBBL provide the corporative social welfare responsibilities and provide social welfare services through Islami Bank Foundation such as Health Education, Technical Education, General Education, etc. However, this service is providing very shortage area. If all of the service provide whole of the country the lower income people will be more benefited and society will be develop day by day.
- IBBL should modernized there medical system.
- IBBL should introduce more interesting and energetic courses for the student.
- IBBL should increase there scholarship program in different schools and college and although in university.
- Management of the bank should immediately take steps so that the activities of bank can be spread in rural areas of Bangladesh too.
- All lslami Banks working in Bangladesh and out side Bangladesh may create instrumental Islamic Money Market for their own interest.
- All the employees of the bank should try to create personal relationship and follow the dynamic Leadership of Islam for their own benefit and for the growth of real Islamic society in Bangladesh
- This Bank should arrange a wide varieties of regular programs like “SEMINAR”“MOSQUE -BASED DISCUSSION” etc. about Islamic Banking Function countrywide to remove the negative impression about IBBL
- The authority of IBBL should Conveyance pressure on Government bodies to run proper and sufficient application of Islamic banking law in Bangladesh.
- To gain success in the programs like Poverty Alleviation and “Self Reliant” specially in rural areas, this bank should provides investment facilities on the basis of individual
Islamic banks can satisfy most of the efficiency conditions if they can operate as a sole system in an economy. On the other hand, does not satisfy any of the efficiency conditions analyzed in the present study. However, when Islamic banks start operation within the conventional banking framework, their efficiency goes on decreasing in a number of dimensions. The deterioration is not because of Islamic bank’s own mechanical deficiencies; rather it is the efficiency-blunt operation of the conventional banking system that puts a negative impact on the efficient operation of Islamic banks. This does not mean that the survival of Islamic banks operating within the conventional banking framework is altogether threatened. Evidence from Bangladesh indicates that Islamic banks can survive within the banking framework by switching over from PLS to trade related modes of financing.
Even under the framework, Islamic banks can operate with certain level of efficiency by applying in a reasonable percentage the PLS-modes – the distinguishing features of Islamic banking. This has been possible in some countries of the Muslim world where the management of Islamic banks was cautious about possible impacts of every policy measure. Particularly, the management of these banks was judicious in selecting sectors or areas as major of their operations. Sudan Islamic Bank is a typical example in this respect. Islamic banks in Bangladesh have much to learn from experience of this successful bank.
Having been considered the pro-efficiency character of Islamic banking and its beneficial impacts on the economy, government policy in Muslim countries should be in favor of transforming system into Islamic banking. From the practical implementation of customer dealing procedure during the whole period of our practical orientation in IBBL, we have reached a firm and concrete conclusion in a very confident way. We believe that our realization will be in harmony with most of the banking scholar. Performance of IBBL during the last five years has proved that with strong desire and will power one achieve whatever target he may have. Almost all the leading banks in our country have various extra facilities in offer for the customers in comparison with IBBL. However, it has succeeded in achieving more customer than many other competitors. This has been possible only because of strong customer relation and excellent customer service.