Credit Approval Process Essay

6818 words - 28 pages


Chapter - I

Introductory Part

1.1 Rationale of the report
SME financing has been identified as a major bottleneck for Bangladeshi SME’s growth. Unfortunately the issue seems to be as unresolved as it always has been. Though the majority of the issues are with the SMEs themselves, the banks and non-banking financial institutions (NBFI) also have major issues in designing financial products for the SMEs. Banks and NBFIs always play a major role in our country’s economy. The number of branches of private bank and NBFI is increasing day by day. As the number is increasing, the competitive environment is making the firms to be more aggressive, ...view middle of the document...

Therefore, an opportunity is offered by Faculty of Business Administration, ASA University Bangladesh, for its potential Business Graduates to get three months practical experience, which is known as “Internship Program”. Internship Program brings a student closer to the real life situation and thereby helps to launch a career with some prior experience. For the internship program, each student is attached with an organization. I was placed in United Leasing Company.

This paper is entitled “Credit Approval Process of Small Enterprise Financing Department in United Leasing Company Limited” originated from the fulfillment of the internship program. During my internship, I had to prepare a report under the supervision of Ms. Rubina Afroze, Lecturer, Faculty of Business Administration, ASA University Bangladesh.

1.3 Objectives of the study

1.3.1 Broad Objectives

← To analyze the credit approval process of Small Enterprise Financing in United Leasing Company Limited.

1.3.2 Specific Objectives

← To explain the current credit approval process of Small Enterprise Financing.
← To identify the shortcomings in credit approval process.
← To identify and analyze the major reasons for the shortcomings of that process.
← To recommend suggestions for overcoming those shortcomings.

1.4 Methodology

1.4.1 Sources of Data collection

This report solely deals with United Leasing Company and the primary emphasis has given to the credit approval process of Small Enterprise Financing. The report is based on both primary and secondary data.

Primary Data Sources:

← Credit officers of Credit Department (SEF) of ULC.
← First hand knowledge gathered from practically dealing with the different steps of the process.
Secondary Data Sources:

← Annual Reports of ULC.
← Brochures of ULC.
← Official website of ULC.
← National Foot Print (official database of ULC).
← IISAF software of ULC.

1.4.2 Process of data collection

The following methods were used to collect the required information for the study:

← Documents: Documentary information for the study is collected from annual reports, websites and official database.

← Interviews: The primary data collected through informal interviews with company’s personnel. The interviews performed in a conversational manner and the respondents will answer in their own words.

← Observation: Information is also collected by the observation of the office works and different activities of the officials during my internship period.

1.4.3 Analysis of Data

The collected data is analyzed in a descriptive way and also presented by graphs, tabulation if necessary.

1.4.4 Population Size

A population of 65 clients was selected who were given sanction from ULC for the month September, 2011 to November, 2011.

1.5 Scope of the study
This report has been prepared through extensive discussion with the...

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