Functions of Ratriya Banijya Bank (RBB)

General Introduction

Rastriya Banijya Bank Limited (RBBL) has a history of serving its customers far and wide across the nation for more than half a century. The bank then fully owned by Government of Nepal, was established on 10 Magh 2022 (23 January 1966) under the special statute "Rastriya Banijya Bank Act, 2021" and had operated under "Commercial Bank Act,2031” until it was re-registered as public limited company on 6 Baishak 2063 (19 May 2006). At present, the Bank operates as "A" class financial institution licensed by Nepal Rastra Bank and carries out commercial banking activities as per the provisions of the "Bank and Financial institutions Act 2073," (2017)

RBBL endured many stressful years of business and faced existential questions at some point of time in the past. But learning the lessons from the events and craving towards the brighter future, the Bank successfully implemented a restructuring plan; and now it stands as one of the most preferred bank with the highest number of customers all 77 districts and 7 provinces of the country. The Bank has been able to imprint its presence in national economy through efficient allocation of resources in all sectors of economy thereby enhancing production and generating employment opportunities within the country. The unflinching faith and goodwill bestowed by our customers continued support from the Government, well wishers and general public has been the reason for us to stand as the most trusted bank in the country.

Functions of RBB

Generally, function of the RBB are the function under the bank and financial institution act (BAFIA), 2073. As per provision under the BAFIA, followings are the key function of RBB, Nepal;

• To accept deposits or to mobilize deposits through various financial instruments and make payment thereof with or without interest

• To accept deposits, making payments, carrying out transactions, carry out intermediary services and transfer funds to other headings through various electronic instruments or devices

• To lend loans including hire-purchase, leasing, housing and overdrafts

• To lend loans on collateral of project and hypothecation and lending or causing to be lend loans in consortium financing having divided the collateral on pari passu basis according to mutual agreement entered into between one another, 

• To lend loans against the guarantee of foreign banks or financial institutions

• To lend loans against the amount covered by the value of the movable or immovable assets which have already been mortgaged to it or lending loans on remortgage in own amount to be covered by the value of the movable or immovable assets which has already been mortgaged to other bank or financial institution, 

• To issue guarantees on behalf of its customers and getting executed necessary bonds with such customers in consideration thereof, obtaining security, and acquire their movable or immovable assets as collateral or on mortgage, or the assets of third persons as collateral and to acquire, and hold the assets holding as security and to carry out other related transactions,

• To make get refinancing from the Rastra Bank as may be required or to lend or borrow loans from other bank or financial institution

• To supply loans or managing loans from the amount received from the Government of Nepal or other national or foreign entity for promotion of a project

• To write-off credits subject to the prevailing credits write-off Byelaws

• To issue shares, debenture, debenture bonds and so on for the purpose of making the capital fund complete, 

• To issue, accept, pay, discount or purchase and sell letters of credit, bills of exchange, promissory notes, cheques, travelers cheques, drafts or other financial instruments,

• To issue, accept and manage digital card or other instruments for electronic transactions and to appoint agents for carrying out acts relating thereto, 

• To carry out foreign exchange business subject to the prevailing laws, 

• To carry out government transactions subject to the limits, terms and conditions or directions of the Rastra Bank, 

• To purchase, sell or accept treasury bills issued by the Government Nepal or bonds issued by the Rastra Bank, 

• To remit or transmit amount to different places within or outside Nepal through bills of exchange, cheques or other financial instruments; receiving remittance from abroad and to make payment thereof, 

• To take responsibility of and make arrangement for the sale or purchase of shares, debentures or securities; collecting interest, dividends etc. accruing from shares, debentures or securities; remitting or transmitting such interests or dividends to places within or outside Nepal; and arranging safe deposit vaults for customers acting as a commission agent of its customers, 

• To carry out off-balance sheet transactions, 

• To disburse credits upto the amount as prescribed by the Rastra Bank against individual or collective guarantee for the economic upliftment of the peoples from the deprived sector, low-income families, victims of natural calamities and inhabitants of any area of the country, 

• To exchange details, information or notices concerning debtors or customers who have obtained credits from it or other banks or financial institutions with the Rastra Bank or any other bank or financial institutions, 

• To buy and sell gold and silver bullions, 

• To conduct, or cause to be conducted, study, research and survey relating to the establishment, operation and evaluation of projects, and providing training, consultancy and other information, 

• To manage properly or sell its assets of every type coming under its ownership according to this Act and the prevailing laws, 

• To give guarantee with the consent of the parties involved in matters of payment to be made or values to be recovered in consideration of any act between two or more persons, subject to the prevailing laws, 

• To carry out such other business as may be prescribed by the Rastra Bank.

Summarizing these, following specific functions are performed by RBB; 

1. Deposit collection through current, saving and fixed deposit
2.Credit facility incorporating business loan, retail loan, agricultural loan etc.
3. Remittance facility by RBB Koria remmit, SWIFT, RBB remmit etc.
4. Digital service incorporating ATM facility, mobile banking, internet banking etc.  

In conclusion, Rastriya Banijya Bank (RBB) plays vital role in banking sector as well as economic development through fund mobilization, employment generation, capital formation etc.