Sources: http://www.abl.com.pk/
4.2.7 Advances
The basic function of VM; is to accept deposit from general public and provide to those propel who needed on certain amount of interest. The VM not kept idle the general public deposits. the bank keeps a percentage of deposit as cash reserve and remaining balance is offering for loan and deposit the bank provides loan and advance in the following manner;
o Running finance /over draft
o Cash finance / cash credit.
o Demand finance / demand loan.
o Term finance.
o Staff finance
o Agricultural finance
o Import/Export Business/Trade finance
a. Running Finance/Over Draft
An over draft is a fluctuating or running finance where in a customer arrange with his bank to permit him to overdraw his current account up to a fixed limit for a short period there are two type of over draft.4
§ Secured over draft
§ Clean draft
i. Secured Overdraft
When the overdraft facility is given against collateral security, it is called secured overdraft.
ii. Clean Draft
When overdraft facility is give against personal security is called clean draft.
The VM provide running finance for one year or less then one year span of time. The running finance usually allow on security. The security may be government securities, shares and property, the securities usually up to 70%-80% of total deposits. According to this method the account holder can withdrawn up to specified limit above from its balance.
b. Cash Finance / Cash Credit
Cash finance is a self liquidating loan. Cash finance is common from of lending by commercial banks. A cash credit is an arrangement by which a banker allows his customer to borrow money up to a certain limit. It is a contractual advance but operated through an account. In cash finance, the borrower is required to pledge security.
The VM granted cash finance generally to the industries and commercial firms. It is providing against current account of the customer against securities. The bank charges interest against whole amount of credit whether used or not.
c. Demand Finance / Demand Loan
The demand finance is providing to meet the working capital requirement. The VM provide its customer the demand finance to facilitate their working capital requirement. The demand finance is granted to the persons against assets. The VM provide this facility usually for one year or more according to customer demand. The interest is charged against the whole amount of issued.
d. Term Finance
The term finance is also called fixed loans. The term finance is valuable for both the bank and borrower. The borrower gets a fixed amount of money for the promotion and maintained of the project. The bank gets a safe investment of its funds for a certain period against a satisfactory security. 5
The VM provide term finance to the newly established project for increase the economic activities in the country. The bank check and analysis the project then provide the finance against immoveable security e.g. mortgage of land, house etc. the VM usually provide this facility for normally 5 years.
e. Seasonal Finance
VM also provides seasonal finance to former to increase our agricultural activities in the country. Seasonal finance facility is allowed against pledge of produce of cash crops harvested in that particular crop season. The delivery of pledged stocks/goods is made against appropriate cash payments.
f. Agricultural Finance
The VM under agricultural finance scheme envisaged by the state bank of Pakistan
g. Staff Finance
The VM not only care their customers but also care their staff by providing friendly working environment, good salary package, staff finance etc the VM provide the advance to its employees. Any employ of VM can take three basic salaries as loan and these are repayable in ten months. The bank also provides loan for purchase of motorcycle, car and for constriction of house. The rate of mark up against motorcycle is 5% and against car loan of 10%.
h. Seasonal Finance
VM also provides seasonal finance to former to increase our agricultural activities in the country. Seasonal finance facility is allowed against pledge of produce of cash crops harvested in that particular crop season. The delivery of pledged stocks/goods is made against appropriate cash payments.
i. Agricultural Finance
The VM under agricultural finance scheme envisaged by the state bank of Pakistan
j. Import / Export Business Or Trade Finance
VM provide highly efficient trade finance services for import / export business for our client or customer through large number of authorized branches where trained and highly motivate staff is available to handle the business on the behalf of their customers.
4.3 VM SCHEMES
VM develop various schemes for its customers to facilities on various occasion. Through these schemes VM mobilize deposits funds from individuals which having surplus funds. The VM offers these schemes
¨ Vastmedia tahaffuz deposit scheme
¨ Vastmedia Mahana Amdni scheme
¨ Vastmedia premium plus account
¨ Vastmedia young server certificates
¨ Vastmedia bather munafa scheme
¨ Hajj deposit scheme
¨ Vastmedia umra aasan
¨ Vastmedia monthly income scheme
¨ Vastmedia profit plus- term deposit
4.3.1 Vastmedia Tahaffuz Deposit Scheme
Vastmedia bank offer its customer those having Rs: 50000/ the vastmedia tahaffuz deposit scheme. Main features are;
¨ Minimum deposit amount Rs: 50000/-
¨ High rate of return.
¨ Profit pay on monthly basis.
¨ Incurrent provide up to Rs: 5000000/-
¨ Voluntary renewal on face value.
¨ VM provide life insurance facility to its customer who renew their scheme 5 times without any extra insurance charges and insurance premium paid by the bank.
¨ Bank pay full claim of death or permanent disability.
¨ The age limit required for the scheme is 18-64.
¨ No medical examination requires for above the 60 age of deposit’s Rs: 500000/- and for deposit up to Rs: 100000/- of age up to 61.
¨ Vastmedia tahaffuz deposit certificate is acceptable as collateral.
4.3.2 Vastmedia Mahana Amdni Scheme
VM offer the vastmedia Mahana Amdni scheme for the mediator income group. Main feature are;
¨ Minimum requirement is Rs: 25000/- and maximum are Rs: 1000000/-.
¨ The maturity period of the scheme is 5 years to 10 years depending to the customer.
¨ Investment can be done by jointly or name of the company.
¨ Special attraction for the widows, children retired person and armed force employees.
¨ The profit pays on monthly basis. The VM rate on return are;
Amount (Rs) monthly profit (Rs)
1000000 5208
500000 2604
100000 521
50000 260
25000 130
¨ The bank pay additional profit to the depositor if bank declared higher profit
4.3.3 Vastmedia Premium Plus Account (PPA)
Vastmedia bank has developed a new product scheme named vastmedia premium plus account (PPA) for its value client. This scheme introduce very high rate of profit especially for;
i. Large corporate groups.
ii. Government and semi government compani3s.
iii. Multi national companies.
iv. Big companies and individuals.
Main characteristics of the scheme are:
¨ Minimum deposited required for scheme are Rs 10 million.
¨ The depositor can be open two type of account;
o Premium plus operation account.
o Premium plus term deposit account.
¨ The profit rate of PPA operation account is 10% p.a.
¨ The profit rate of term deposit are:
Deposit term rate
30 days 6% p.a.
3 months 4.5% p.a.
6 months 5% p.a.
1 year 6% p.a.
¨ Operation account can be open like a current account with the minimum deposit of 10 million.
¨ In the case of balance drops below Rs: 10 million on a day or a month the profit is charge on the half yearly basis.
4.3.4 Vastmedia Young Saver Certificates
Increase the habit of the saving in the young is very important for the future needs. Vastmedia bank introduce the scheme by the name of young server certificates. Main characteristic of scheme are;
¨ Maturity period of the scheme are 10 years.
¨ All age group are the customer of this scheme.
¨ Children are also operating this account by the guideline of their parent.
¨ The customer can be by the certificate of the amount Rs: 300/-, 500/-, 1000/-, 10000/-, 5000/-, and 100000/-.
4.3.5 Vastmedia Bather Munafa Account
VM always pay more and more profit to its customer. Do VM introduce scheme by the name of vastmedia bather munafa account. Main feature are;
¨ No minimum and maximum limit of deposit.
¨ High rate of return.
¨ The depositor may avail facility up to 75% of its deposit.
¨ No deduction of zakat on profit and deposit amount.
4.3.6 Vastmedia Umra Aasan
Vastmedia also launched the vastmedia umra sachem under which the bank offers the aircraft, accommodation facility, transportation and Saudi Arabia
4.3.7 Hajj Deposit Scheme
The bank serves the intending pilgrims by helping them in performing this religious obligation. So VM offers its customer the hajj deposit scheme. Main feature are;
¨ No profit to be paid by bank on hajj deposit scheme.
¨ Deposit amount is send by bank branch to the head office and head office take all action on its.
4.3.8 Vastmedia Monthly Income Scheme
The Vastmedia Monthly Income Scheme is a unique product with attractive package. As its name indicates this scheme provide the monthly opportunity to its valuable customers. Main features are;
¨ Maturity of scheme is 3 years.
¨ Free transfer of monthly profit to any branch of VM country wide.
¨ Long facility against depositor.
¨ Minimum limit is Rs: 100000/- with the increment of Rs: 10000/-.
¨ Profit pays monthly Rs 850/- or 10.20 % p.a.
¨ Profit can be credited in the depositors account and depositor can be withdrawn through the ATM card free of charge.
4.3.9 Vastmedia Profit Plus – Term Deposit
This scheme offers vastmedia bank’s customer an attractive return on various terrors tailored to customer needs. Main lineament of the scheme is;
¨ Profit pay on monthly basis or quarterly basis according to customer requites.
¨ There is no restriction for maintains of any minimum balance in the account.
¨ VM pay high rate on return.
¨ VM offer the following rate on return;
Deposit amount | Rate | |||
Amount (RS) | 1 month | 3 months | 6 months | 1 year |
5 million – less then 5 million | 6.5% | 7.0% | 7.5% | 8.0% |
5 million – 10 million | 6.75% | 7.25% | 7.75% | 8.25% |
10 million – 15 million | 7.00% | 7.50% | 8.00% | 8.50% |
15 million – 20 million | 7.50% | 8.00% | 8.50% | 9.00% |
20 million & above | 8.00% | 8.50% | 9.00% | 9.50% |
4.3.10 Vastmedia Profit Plus- Deposit Account
Vastmedia profit plus is the profit bearing check account with payment of the profit on monthly basis. Main feature are;
¨ Monthly payment of profit.
¨ No restriction on maintain any balance on minimum balance in the account.
¨ Individuals, companies, schools, organizations etc are free to open their account in this scheme.
¨ The VM offer following rate of returns;
Amount ( Rs) | Rate ( per month) |
1 million – 5 million | 6.00% |
5 million – 10 million | 6.50% |
10 million – 25 million | 7.50% |
25 million & above. | 8.00% |
Summary
This chapter deals with different functions and scheme of VM which they lunch for the customers. The main objective of bank is to provide special services to its customers and to maintain the best slandered through their quality functions and schemes. In next chapter we discussed about VM HRM department & computerization of VM.
Reference:
1) Nasir A. Saeed, (2005). Money Banking & Finance. Faisalabad
2) Nasir A. Saeed, (2005). Money Banking & Finance. Faisalabad
3) Nasir A. Saeed, (2005). Money Banking & Finance. Faisalabad
4) Nasir A. Saeed, (2005). Money Banking & Finance. Faisalabad
5) Nasir A. Saeed, (2005). Money Banking & Finance. Faisalabad
6) VM website http://www.abl.cpm.pk/
7) Account Manual 2005, general services division VM.
8) Operational Manual 2005, Peshawar
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