Clearing and Settlement

The Mechanism
Clearing system is a mechanism for calculating and determining each bank’s ‘payments / receipts’ position within the Commercial banks forming part of the system. A clearing system is governed by its rules which, among other things, include ‘timing’ for presentation and return of payment instruments.

Settlement is the transfer of value to discharge a payment obligation. Settlement may be within the branch or within the bank or among other banks. The first two being fairly easy, it is the last part of settlement that involves more banks and settlement is effected through the State Bank of Pakistan. Logistical help since the last few years is obtained from National Institutional Facilitation Technologies (NIFT).

Handling of Customers

Handling of Customers in certain circumstances.
During group discussions many people never speak up because they are afraid that people will judge them for saying something stupid. This fear is not really justified. Generally, people are much more accepting than we imagine. In fact most people are dealing with exactly the same fears. By making an effort to speak up at least once in every group discussion you will become a better public speaker. You will instill more confidence in your thoughts and will be recognized as a leader by your peers.

1. Handling of Customers in certain circumstances.
2. Powers of attorney / Mandate
3. Safe custody of customer’s valuables and lockers.

Handling of Customer Accounts in the following Circumstances.

1. Countermand of payment (Stop Payment of Cheque)
2. Notice of Customer’s death
3. Notice of adjudication of customer as an insolvent
4. Notice of customer’s insanity
5. Legal orders attaching customer’s account — A garnishee order 

{insolvent = a person who is unable to pay his debts as they arise.}

Opening accounts for various types of customers

Opening accounts for various types of customers
Opening of Account - Every adult and sane individual can open a bank account, provided he is not insolvent or an un-discharged bankrupt. Joint account can also be opened by two or more individuals. Similarly a group of persons having formed themselves into a ‘partnership firm’ can also open a ‘partnership account’, provided the maximum number of partners is twenty. Whenever the maximum number exceeds this limit, law requires that it should get itself incorporated as a joint stock company under the Companies Ordinance 1984.

A bank account is opened with an initial deposit of money generally in the form of cash. To this end an account opening form is used. The account opening form is required to be completed and signed by the prospective account holder and accepted by the branch Manager or an official duly authorized in this behalf. The completion and signing of the account opening form by the prospective customer and its subsequent acceptance by the bank and deposit of initial amount constitutes a contractual relationship between the account holder and the bank. 

Know your Customer and Anti Money Laundering (AML)

The only way your knowledge and vocabulary can grow is by looking up the meanings of all unfamiliar words in a good New Edition Dictionary. Specialized Dictionaries like the ones on (1) Law and (2) banking and finance can increase your understanding of technical terms and concepts.
Make a resolution that you will look up the words, whose meanings are not clear to you.

Know your Customer and Anti Money Laundering (AML)
(Story BCCI convicted of money laundering and liquidated world wide.)

What is Money Laundering?
Money laundering can be defined as the process whereby the true identity of illegally obtained money is changed or concealed so that it appears to have originated from a legitimate source.

Prudential Regulations for Banks

If the banks in Pakistan violate these Prudential Regulations they are liable to face heavy financial penalties and the bank officers can face disciplinary action by the State Bank of Pakistan and the bank can lose their banking licence besides heavy financial penalties.)

Nature of Prudential Regulations:
Prudential Regulations are both preventive and protective techniques. Preventive regulations forestall crises by reducing the risks facing banks such as controlling and monitoring the management of banks’ capital, solvency (CHECK THE MEANINGS OF SOLVENCY IN THE COMPUTER) and liquidity standards and large exposure limits. Protective techniques provide support to banks once a crisis threatens; lender-of-the-last-resort facilities are of immediate benefits.

In case of Pakistani banks branches functioning overseas the Prudential Regulations or legal requirements of host country shall prevail. The Prudential Regulations do not supersede other directives issued by SBP from time to time.

Literacy and Economic Development

Literacy and Economic Development

Economic prosperity of a country entirely depends on the economic resources it has. These economic resources are classified as Natural resources, financial resources and Human resources. Natural resources comprise of fertile land, ideal topography, abundant forests, sufficient mineral resources and excess water supply. Financial resources include the capital needed for the economic activities. Human resources include the population, its growth rate, skills, standard of living and working capacity of the labour force. According to modern economists a country leading in natural resources has more opportunities to develop than that of a country lacking in such resources. But only abundant availability of natural resources does not make sure the economic development of a country, these resources need to be utilized at their optimum. And this is only possible when efficient manpower utilizes these resources. The developed economy of Japan is the open example in this regard whereby Japan had overcome the deficiency of Natural resources by excelling in Human resources. In other words it can be said that economic development only occurs when Natural and Financial resources are maintained properly by efficient Human resources.

On the other hand if Human resources fail to maintain Natural and Financial resources, these resources may be misutilized, underutilized or unutilized and cause economic inefficiency, for instance underdeveloped countries of the world like Afghanistan has excess of mineral resources but the economy is not developed due to lack of Human resources. Another example is Pakistan, where we have sufficient mineral resources but due to lack of skilled manpower we cannot utilize all those resources, and as a result of such we are not in the queue of developed countries.

Good Governance

Good Governance

The concept of "governance" is not new. It is as old as human civilization. Simply put "governance" means: the process of decision-making and the process by which decisions are implemented (or not implemented). Governance can be used in several contexts such as corporate governance, international governance, national governance and local governance.

Since governance is the process of decision-making and the process by which decisions are implemented, an analysis of governance focuses on the formal and informal actors involved in decision-making and implementing the decisions made and the formal and informal structures that have been set in place to arrive at and implement the decision.

Government is one of the actors in governance. Other actors involved in governance vary depending on the level of government that is under discussion. In rural areas, for example, other actors may include influential land lords, associations of peasant farmers, cooperatives, NGOs, research institutes, religious leaders, finance institutions political parties, the military etc. The situation in urban areas is much more complex. Figure 1 provides the interconnections between actors involved in urban governance. At the national level, in addition to the above actors, media, lobbyists, international donors, multi-national corporations, etc. may play a role in decision-making or in influencing the decision-making process.

Humanism

Humanism

The exact time when the term Humanism was first adopted is still unknown. It is,however, certain that its roots are somewhere in Italy. Before going to the function of humanism i'd like to discuss the confusions and controversies related to this term. 

Because of the variety of meanings, and unclear descriptions of authors and speakers it can easily become a source of confusion, so lets classify the varieties of humanism first.

1. Literary Humanism is a devotion to the humanities or literary culture. 
2. Renaissance Humanism which deals with the learning and the ability of human beings to determine for themselves truth and falsehood. 
3. Cultural Humanism is the rational and empirical tradition that originated largely in ancient Greece and Rome, evolved throughout European history, and now constitutes a basic part of the Western approach to science, political theory, ethics, and law. 
4. Philosphical Humanism is any outlook or way of life centered on human need and interest. Philosophical humanism is further catagorized as Christian humanism and Modern Humanism.(I'll discuss Philosophical humanism in detail first then the other varieties of Humanism)

Islamic Fundamentalism

Islamic Fundamentalism

I Introduction: 

Islamic Fundamentalism, diverse political and social movements in Muslim countries of North Africa, the Middle East, and South Asia, which have as their goal national government based on the principles and values of Islam. Although these movements all seek to restore social justice based on sharia (Islamic law), they differ in the form of government they seek and in how strictly they believe the government should interpret the law.

For many people in the West, the term “Islamic fundamentalism” evokes images of hostage crises, embassies under siege, hijackings, and suicide bombers. But these images hardly present a comprehensive picture. The ranks of Islamic fundamentalists include Muslims who provide much-needed services to the poor through Islamic schools, medical clinics, social welfare agencies, and other institutions. While some Islamic militants try to reach their goals through violence, the majority of Islamic activists work through political parties within the electoral process. At the fringes are those like Saudi-born millionaire Osama bin Laden and his al-Qaeda network that engage in a global war of terrorism.

The reassertion of Islam and Islamic values in Muslim politics and society over the past 30 years is often referred to in the West as the rise of Islamic fundamentalism. However, the word fundamentalism, which originated in Christianity, can be misleading when it is used to describe Islam or Muslim countries. The conservative monarchy of Saudi Arabia, the radical socialist state of Libya, and clerically governed Iran have all been described as “fundamentalist,” but this description fails to take into account vast differences in their governments and policies. Political analysts prefer to use the expressions “political Islam” or “Islamism” when discussing Islam’s many-faceted roles in current social and political movements.

Democracy

Democracy

Introduction:-

Democracy is a tender topic for a writer: like motherhood and apple pie it is not to be criticized. One will risk being roundly condemned if he, or she, points out the serious bottleneck that is presented when a community attempts, through the democratic process, to set plans for positive social action. A man is not permitted to hesitate about its merits, without the suspicion of being a friend to tyranny, that is, of being a foe to mankind? 
The notions of government and of democracy are independent notions and do not, from what I can see, depend on one another. What is likely required for the masses of people, as we see in "modern" world societies, is an established system of government. Where there is a need for an established system of government, it will likely naturally come about; and do so, whether, or not, it has the consent of the people, -- real or imagined. Putting aside, for the moment, the arguments of Hobbes and Locke, I believe, on the basis of plain historical fact, that governments come about naturally and maintain themselves naturally without the general will of the people; indeed, I believe, with many others I suspect, that our long established democratic governments in the world (the United States and Canada being among them) did not come about by the general will of the people, at all; nor is it necessary that it should it be maintained by the will of the people. One should not conclude, therefore, that democracy is necessary for good government: It may not be. What is necessary for optimum prosperity is a state of acquiescence, which, as it happens, is the hallmark of western democracies. It may be, that the only thing needed is but the trappings of democracy. 

Alleviating Poverty

Alleviating Poverty

POVERTY is simply a state of human ill-being and unacceptable human deprivation. Its concept extends from low levels of incomes and consumption to lack of education and poor health. Different people view poverty in different perspectives. The worst kind of poverty is when people do not have access to basic food and water to fulfil their basic physical needs, therefore they are undernourished, weak and very susceptible to diseases. Another kind of poverty is where people have adequate food but do not have access to other basic needs, i-e: water for sanitation, public health services, clothes and housing. Poverty is not so simple that limits itself to food, cloth and housing. It includes other social dimensions like powerlessness, insecurity, vulnerability, isolation and social exclusion. The poors suffer from stunted growth due to malnutrition, diseases like diarrhoea which result from unsafe drinking water; and low level of schooling. They are not supplied with basic amenities like clean water and a place to live. They have no protection under the law. They are the most vulnerable to crimes. They are deprived of every security that a government provides to its citizens. They have been totally excluded from our societies just as they are not one of us.

Democracy is the best form of Government

Democracy is the best form of Government

Democracy is the government of the people, by the people, for the people.
Abraham Lincoln

Democracy is a form of government under which the power to alter the laws and structures of government lies, ultimately, with the citizenry. Under such a system, legislative decisions are made by the people themselves or by representatives who act through the consent of the people, as enforced by elections and the rule of law. 

Democracy is a tender topic for a writer: like motherhood and apple pie it is not to be criticized. One will risk being roundly condemned if he, or she, points out the serious bottleneck that is presented when a community attempts, through the democratic process, to set plans for positive social action. A man is not permitted to hesitate about its merits, without the suspicion of being a friend to tyranny, that is, of being a foe to mankind? 

Love is Life and Life is Love

Love is Life and Life is Love

Since the day I was born, I've been on this long, mystical journey through life. I'm still only a teenager, and have many a year to go, but I know I have a purpose in this home we call Earth. What would be the point in living if we didn't have a purpose? I know I have many, but I don't know them all clearly. Only through living life will I learn my clear purpose of being here. 

Everyone's purpose is distinctly different yet the same in many ways. Some seem to be decided already, yet just as many could be free-will. We are given the gift of free will, from whomever or whatever has created our living system. This gift gives us the ability to share the main purpose in life, to love and be loved. To me, this life is learning how to love everyone for who they are, and not what you want them to be. I do my best to love everybody, even the ones who have trouble returning it. The reason behind this is because I know there is good in the deepness of everyone. Just looking deep into a babies eyes, I'm ensured there is no bad-heartedness in there. The reason I feel we as humans can become evil-hearted is because of our lack of love in society, and many contributing factors such as materialism and lust. 

Banker Customer Relationship

What is a Banker: 
According to Section 3(b) Negotiable Instruments Act (Amendment) 1962 a "Banker means a person transacting the business of accepting, for the purpose of lending or investment, of deposits of money from public, repayable on demand or otherwise and withdrawable by cheque, draft, order or otherwise and includes any Post Office Saving Bank".
Banker has been defined in almost the same terms in section 5(b) of Banking Companies Ordinance 1962.

In simple words we can say banker is one who:

1. Takes deposits of money from the people, 
2. Repays these deposits to the people according to agreed terms and conditions including on demand, and 
3. Lends and/or invests these deposits in profitable ventures.

Who Is a Customer. The term customer has not so far been defined in any banking law, however, some eminent writers on banking and jurists have tried to define it. Sir John Paget says: "To constitute a person being called a “customer” there must be some recognisable course or habit of dealing in the nature of regular banking business". The most important point, according to Sir John Paget, was the sufficiently long "duration" of relationship between the banker and a customer, but it was ruled off by the judgement of Mr. Justice Bailhache in the case of Ladbroke v/s Todd (1914) who observed "the relationship of banker and customer begins as soon as the first cash deposit is accepted or a cheque is paid in and accepted for collection and not merely when it is paid".

Banking Laws And Regulations

Law constitutes the principles and regulations established in a country by some authority, applicable to its people, whether in the form of legislation or of customs and practices recognized and enforced by judicial decision. It is the implementation of social order and justice created by adherence to such a system. The system of judicial administration puts the laws of a community into effect, e.g. all citizens are equal before the law.

The banking business flourishes on the support and confidence of public because they contribute to the capital and deposits of money in the banks. This confidence is strengthened as and when the people find that their interests are being looked after properly by the government and it’s authorized regulatory agencies.

Banks and bank accounts are regulated by Federal statutory law. Banks are established in Pakistan under the Banking Companies Ordinance 1962, regulated by SBP through Prudential Regulations, and Exchange Control Manual. Bank accounts may be established by private and state-owned banks (National Bank of Pakistan) and National Savings centres. All are regulated by the Federal laws. Cheques and related matters (bearer, order, crossing, protection to the bankers, etc) are governed under the Negotiable Instruments Act 1881.