Maharashtra Board Class 11 Secretarial Practice Solutions Chapter 11 Correspondence with Banks

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Balbharti Maharashtra State Board Class 11 Secretarial Practice Solutions Chapter 11 Correspondence with Banks Textbook Exercise Questions and Answers.

Maharashtra State Board Class 11 Secretarial Practice Solutions Chapter 11 Correspondence with Banks

1A. Select the correct answer from the options given below and rewrite the statements.

Question 1.
A company usually opens _____________ account in a bank.
(a) Current
(b) Saving
(c) Recurring
Answer:
(a) Current

Question 2.
Bank is a _____________ institution.
(a) financial
(b) social
(c) cultural
Answer:
(a) financial

Question 3.
The appointment of banker is usually made by the _____________
(a) Board of Directors
(b) Secretary
(c) Chairman
Answer:
(a) Board of Directors

Maharashtra Board Class 11 Secretarial Practice Solutions Chapter 11 Correspondence with Banks

Question 4.
Resolution for opening Bank Account is passed in the _____________ meeting.
(a) Board
(b) Statutory
(c) Annual General
Answer:
(a) Board

Question 5.
Bank provides overdraft facility to _____________ account holder.
(a) Current
(b) Saving
(c) Fixed Deposit
Answer:
(a) Current

Question 6.
_____________ is used for depositing cash into a bank account.
(a) Pay-in-slip
(b) Withdrawal slip
(c) Cheque
Answer:
(a) Pay-in-slip

Question 7.
Borrowing/Accepting and lending money are considered as _____________ functions of bank.
(a) Primary
(b) Secondary
(c) Agency
Answer:
(a) Primary

Question 8.
Withdrawals are not permitted from the _____________ deposit account.
(a) Fixed
(b) Current
(c) Savings
Answer:
(a) Fixed

Maharashtra Board Class 11 Secretarial Practice Solutions Chapter 11 Correspondence with Banks

Question 9.
_____________ account is suitable to salaried people.
(a) Savings
(b) Current
(c) Fixed
Answer:
(a) Savings

Question 10.
Generally Interest is not paid on _____________ deposit account.
(a) Current
(b) Saving
(c) Fixed
Answer:
(a) Current

Question 11.
A deposit which is kept for fixed period in bank is called _____________ deposit.
(a) Fixed
(b) Current
(c) Recurring
Answer:
(a) Fixed

1B. Match the pairs.

Question 1.

Group ‘A’ Group ‘B’
(a) Lost cheque (1) Board of Directors
(b) Appointment of Banker (2) Higher rate of interest
(c) Cash credit (3) Used for depositing cash and cheque
(d) Fixed Deposit Account (4) Stop Payment
(e) Savings Account (5) Restrictions on withdrawals
(f) Pay-in-slip (6) Separate Account
(g) Overdraft facility (7) Current Account
(8) Recurring Account
(9) Shareholders
(10) No interest is paid
(11) Used for withdrawing amount from the account
(12) Long term credit facility
(13) Certain restrictions on withdrawals
(14) Dealing in foreign exchange

Answer:

Group ‘A’ Group ‘B’
(a) Lost cheque (4) Stop Payment
(b) Appointment of Banker (1) Board of Directors
(c) Cash credit (6) Separate Account
(d) Fixed Deposit Account (2) Higher rate of interest
(e) Savings Account (5) Restrictions on withdrawals
(f) Pay-in-slip (3) Used for depositing cash and cheque
(g) Overdraft facility (7) Current Account

1C. Write a word or a term or a phrase that can substitute each of the following statements.

Question 1.
A slip is used for depositing cash and cheque in the Bank account.
Answer:
Pay-in-slip

Question 2.
Permission to withdraw excess amount from Current Account.
Answer:
Overdraft

Question 3.
Separate loan account under which the short-term loan facility is given by the bank to the business.
Answer:
Cash credit

Maharashtra Board Class 11 Secretarial Practice Solutions Chapter 11 Correspondence with Banks

Question 4.
The short-term credit facility is given by the bank to the current account holder.
Answer:
Overdraft

Question 5.
The account is generally opened by the business organization.
Answer:
Current Account

Question 6.
The request of Secretary to the bank not to make the payment of the cheque.
Answer:
Stop payment request

Question 7.
The type of account for which a higher rate of interest is paid to bank depositors.
Answer:
Fixed Deposit Account

Question 8.
The slip is used for withdrawing money from Savings Account.
Answer:
Withdrawal Slip

Question 9.
Negotiable Instrument which can be discounted with the bank.
Answer:
Bill of exchange

Maharashtra Board Class 11 Secretarial Practice Solutions Chapter 11 Correspondence with Banks

1D. State whether the following statements are True or False.

Question 1.
Joint Stock Company opens Current Account.
Answer:
True

Question 2.
Generally, no interest is paid by the bank on the Current Account.
Answer:
True

Question 3.
In cash credit, the customer’s account is credited by the bank with the sanctioned amount.
Answer:
True

Question 4.
Board resolution is not required to open the Current Account with the bank.
Answer:
False

Question 5.
The bank account of the company is operated by shareholders.
Answer:
False

Question 6.
Overdraft facility is granted to Savings account holders.
Answer:
False

Question 7.
Bank correspondence should be brief and to the point.
Answer:
True

Maharashtra Board Class 11 Secretarial Practice Solutions Chapter 11 Correspondence with Banks

Question 8.
It is necessary to instruct the bank to stop the payment of a cheque that is lost.
Answer:
True

Question 9.
A bank overdraft facility is a long-term facility.
Answer:
False

Question 10.
Banks grant long-term loans only.
Answer:
False

1E. Find the odd one.

Question 1.
Saving Deposit, Recurring Deposit, Cash Credit. Fixed Deposit
Answer:
Cash Credit

Question 2.
Overdraft, Fixed Deposit, Discounting of Bills, Cash Credit
Answer:
Fixed Deposit

1F. Complete the sentences.

Question 1.
A financial institution which receives deposits and lends money is called as _____________
Answer:
Bank

Question 2.
Accepting deposits and lending money are the primary functions of _____________
Answer:
Commercial Bank/Bank

Maharashtra Board Class 11 Secretarial Practice Solutions Chapter 11 Correspondence with Banks

Question 3.
A facility under which a customer can overdraw money from his account is called as _____________
Answer:
Overdraft facility

Question 4.
Overdraft facility is given to _____________
Answer:
Current Account Holder

1G. Select the correct option from the bracket.

Question 1.

Group ‘A’ Group ‘B’
(1) Overdraft …………………………
(2) Primary Function ………………………..
(3) International Trade Transactions ………………………..
(4) ……………………… Current Account

(Accepting Deposits, Current Account, Letter of Credit, Businessman)
Answer:

Group ‘A’ Group ‘B’
(1) Overdraft Current Account
(2) Primary Function Accepting Deposits
(3) International Trade Transactions Letter of Credit
(4) Businessman Current Account

1H. Answer in one sentence.

Question 1.
What is a Letter of Credit?
Answer:
A letter of credit is a payment method generally used for international trade transactions. Letter of credit is issued by a bank on behalf of its client, promising to pay a certain amount of money to the seller, in case the buyer fails to pay it.

Question 2.
Which facility is given to the Current Account holder?
Answer:
Overdraft facility is given to Current Account Holder by the Bank.

Maharashtra Board Class 11 Secretarial Practice Solutions Chapter 11 Correspondence with Banks

Question 3.
What do you mean by stop payment of cheque?
Answer:
When a cheque is issued by the company, there is a possibility of misplacement of the cheque or loss in transit. Then it is necessary to inform the bank to stop payment of such cheque.

1I. Correct the underlined word and rewrite the following sentences.

Question 1.
Accepting deposits is the secondary function of Banks.
Answer:
Accepting deposits is the primary function of Banks.

Question 2.
Businessman opens Fixed Deposit Account.
Answer:
Businessman opens Current Account.

Question 3.
Under cash credit facility businessman/account holder can overdraw from his account.
Answer:
Under an overdraft facility, a businessman/account holder can overdraw from his account.

2. Explain the following terms/concepts.

Question 1.
Bank
Answer:
A bank is a financial institution, in which people deposit their idle or surplus cash, and those who need funds borrow from banks.

Question 2.
Demand Deposits
Answer:
The deposits which are repayable on demand are called Demand Deposits.

Maharashtra Board Class 11 Secretarial Practice Solutions Chapter 11 Correspondence with Banks

Question 3.
Time Deposits
Answer:
The deposits which are not repayable on demand are called Time Deposits.

Question 4.
Savings Deposits
Answer:
To encourage saving habit among the people, the bank allows depositors to open a savings account. There are restrictions on the frequency and amount of withdrawals.

Question 5.
Current Deposits
Answer:
This account is normally opened by businessmen, firms, or companies. There is no limit on the amount or number of withdrawals.

Question 6.
Recurring Deposits
Answer:
The account which encourages the customers to make regular savings and to deposit a fixed sum of money for a specific period of time is called Recurring Deposits.

Question 7.
Fixed Deposits
Answer:
Fixed Deposits are the deposits received for a fixed period. The rate of interest is high for fixed deposits. The longer the period of deposit, the higher is the rate of interest.

Question 8.
Loans
Answer:
A loan granted for a specific time period against personal security, gold or silver, and other moveable or immovable assets is called a term loan.

Question 9.
Advances
Answer:
Advances is a credit facility provided by the bank to its customers. It differs from loans in the sense that loans may be granted for a longer period, while advances are for a shorter period.

Maharashtra Board Class 11 Secretarial Practice Solutions Chapter 11 Correspondence with Banks

Question 10.
Cash Credit
Answer:
Under a cash credit facility, a bank allows the borrower to withdraw amounts up to the specified limit. Such credits are allowed against the security of stock of raw material, finished goods, etc.

Question 11.
Overdraft
Answer:
It is a facility where the bank allows its customers to overdraw an amount up to a particular limit. Such facility is allowed against collateral securities like shares, FDR, LIC Policy, etc.

Question 12.
Discounting of Bill
Answer:
It is a short-term finance facility provided by the bank to its customers by allowing discounting of bills and making payment of bills before their due date.

Question 13.
Letter of Credit
Answer:
A letter of credit is a payment method generally used for international trade transactions. A letter of credit is issued by a bank on behalf of its client, promising to pay a certain amount of money to the seller in case the buyer fails to pay it.

Question 14.
Stop payments of cheque
Answer:
When a cheque is sent by the Company, there is a possibility of misplacement of cheque or loss in transit. In that case, it is necessary to inform the bank to stop the payment of such cheques.

3. Distinguish between the following.

Question 1.
Current Account and Savings Account.
Answer:

Basis Current Account Savings Account
1. Meaning It is a type of bank account that is generally opened by the businessman to carry out their business activities. It is a type of bank account which is opened by salaried and household people with an aim of saving their part of the income and earn interest.
2. Withdrawals There are no restrictions on the number of withdrawals. They can withdraw money by cheque. There are restrictions over the number of withdrawals. They can withdraw money either by cheque or by withdrawal slip.
3. Facilities Such account holder gets the facilities of Passbook, Cheque Book, Statement of Account and Pay-in-Slip Book. Such account holders get the facilities of Passbook, Cheque Book, and Pay-in-Slip Book.
4. Rate of Interest Generally, no interest is allowed on the Current Account. If it is allowed it is a very nominal rate. The rate of interest on the Saving Account is higher than the Current Account but less than fixed deposits.
5. Overdraft facility Overdraft facility is allowed to Current Account holders. Overdraft facility is not allowed to Saving Account holder.
6. Suitability It is suitable for traders, business firms, and institutions. It is suitable for salary earners, households, and fixed income groups.

Maharashtra Board Class 11 Secretarial Practice Solutions Chapter 11 Correspondence with Banks

Question 2.
Loan and Overdraft
Answer:

Basis Loan Overdraft
1. Meaning Amount granted for a specific period of time, against personal security, gold or silver, and other movable or immovable assets is called a loan. Overdraft is a credit facility granted by the bank to Current account holders. Under an overdraft facility, the bank allows its customers to overdraw an amount up to a particular limit.
2. Eligibility Savings account, Fixed, Recurring, and Current account holders are eligible for the loan facilities. Only Current account holders are eligible for an overdraft facility.
3. Duration The loan is a long period facility. Overdraft is a short period facility.
4. Purpose The purpose is to meet long-term requirements. The purpose is to meet short-term working capital requirements.
5. Repayment The amount of the loan may be repaid in installments or in a lump sum on its due date. The amount of overdraft is adjusted against the balance of Deposits in the Current account.
6. Security It is provided against personal security, gold or silver, and other movable or immovable assets. It is provided against collateral securities like shares, FDR, LIC Policy, etc.

Question 3.
Fixed Deposit Account and Recurring Deposit Account.
Answer:

Basis Fixed Deposit Account Recurring Deposit Account
1. Meaning Fixed Deposits are the deposits received for a fixed period of time. A Recurring Deposit account is that account where depositors regularly deposit a fixed amount for a specific period of time.
2. Facilities The bank gives a Fixed Deposit Receipt to the Fixed Deposit holders. The bank gives a Pass Book and Pay-in-Slip book to Recurring Deposit holders.
3. Rate of Interest The rate of interest allowed is higher. The longer the period of deposit, the higher will be the rate of interest. The rate of interest is less than Fixed Deposit Account.
4. Suitability It is suitable for those people having surplus income in hand. It is suitable for fixed-income groups and lower-income groups.

4. Answer in brief.

Question 1.
What are the points to be kept in mind by a Secretary while corresponding with Banks?
Answer:
The following precautions must be taken by the secretary while corresponding with banks:

  • Prompt reply: For any correspondence with the bank, the reply must be sent without delay is the responsibility of a secretary.
  • Brevity/Conciseness: Secretary should provide maximum information in minimum words. A letter should not be lengthy. Unnecessary details, irrelevant information or explanation, lengthy paragraphs should be avoided.
  • Courtesy: The letter to the bank should show empathy, respect, and mutual understanding. It is helpful for getting favourable responses and built up goodwill for the organization.
  • Accuracy: While corresponding with Bank ‘Accuracy’ and ‘Perfectness’ are very important. Whatever information or data provided must be accurate. No haphazard remarks or statements are to be made.
  • Clarity: The secretary must provide true, factual updates and clear information about his organization to the banker. Clarity is required to avoid misunderstandings with bankers.

Question 2.
Under what circumstances will a secretary correspond with the Banks?
Answer:
The following are the circumstances under which a secretary has to correspond with the banks:
(i) Letter for opening a Current Account with the Bank:
The decision of opening a Current account is taken in the Board meeting by passing a resolution. The Board instructs the secretary for opening a Current account. The Secretary has to write a letter to the Bank accordingly and enclose the necessary documents.

(ii) Letter requesting a bank to stop payment of cheque:
When cheques are sent by Companies, there are possibilities of misplacement of cheques or loss in transit. Thus, it is necessary to inform the bank to stop the payment of such cheques.

(iii) Letter requesting a Bank for granting an overdraft facility:
Certain credit facilities are provided by the Bank to their customers. The Bank allows a Current Account holder to withdraw excess amount than the available balance. Secretary has to correspond with the bank to prevail this facility.

(iv) Letter requesting bank to issue a letter of credit:
A letter of credit is a payment method generally used for international trade transactions. Letter of credit is issued by Bank on behalf of its client promising to pay a certain amount of money to the seller in case the buyer fails to pay it. Secretary has to correspond with the bank to obtain this letter of credit.

Maharashtra Board Class 11 Secretarial Practice Solutions Chapter 11 Correspondence with Banks

Question 3.
State the agency functions of Banks.
Answer:
Agency functions of banks are part of secondary functions.
Following are the agency functions of the Bank:

  • Bank collects the cheques and Bill of Exchange on behalf of the customers or account holders.
  • Bank collects dividends, interest, and salary and credits the account holder’s account.
  • Bank makes payment of rent, insurance premium, electricity bill, etc.
  • Bank act as a Depository Participant for purchase and sale of securities.
  • Transfer of money.
  • Fulfill standing instructions of depositors.
  • The bank acts as a trustee, an executor of the will, and an attorney for the account holder.
  • The bank acts as a Banker to the issue, Lead Manager, etc. for the companies.

Question 4.
State the utility functions of Banks.
Answer:
Commercial Bank provides general utility services to their customers or account holders to attract customers.
Utility functions of Banks are as follows:

  • Provide locker facility to customer utility function of banks are as follows.
  • Provide a letter of credit facility to account holders for international business transactions.
  • Helps to deal in Foreign Exchange.
  • Provide Credit cards, Debit cards, and A.T.M. facilities.
  • To assist in the purchase and sale of securities.
  • Provide traveler’s cheque to customers.

Question 5.
Explain the different types of Deposits.
Answer:
The Bank accepts two types of deposits from the people.
(i) Demand Deposits:
Demand Deposits are deposits, where money is repaid by the bank on the demand made by the depositors or customers of the bank.

Such deposit accounts are:
(a) Savings Deposits:
As the name indicate this account is opened and operated by that person who have regular and fixed income e.g. salary. In order to ‘save’ something out of current income, this account is opened.
Features of this account are:

  • It is mainly for saving purposes.
  • Money can be withdrawn on demand.
  • Minimum balance must be maintained.

(b) Current Deposits:
This account is opened by the businessman, firm, company, etc. for business purposes. There is no limit on the number of withdrawals. Generally, interest is not payable on this account. Overdraft facilities are also allowed to these depositors.

(ii) Time Deposits:
The deposits which are not repayable on demand are called ‘Time Deposits’. These deposits are payable after a specific period of time.

  • Fixed Deposits: In this deposit account, a certain sum is kept deposited for a fixed period. A higher rate of interest is paid on Fixed Deposit.
  • Recurring Deposits: In this deposit account, the customer deposit’s fixed amount on regular basis for a specific period. The money is deposited periodically. The rate of interest is more than Saving Deposits.

Maharashtra Board Class 11 Secretarial Practice Solutions Chapter 11 Correspondence with Banks

5. Justify the following statements.

Question 1.
The secretary has to correspond with the Banks under certain circumstances.
Answer:
Following are the circumstance under which a secretary has to enter into correspondence with banks:

  • Letter for opening a Current account with Bank.
  • Letter requesting a bank to stop payment of the cheque.
  • Letter requesting a bank for granting overdraft facility.
  • Letter requesting a bank to issue a letter of credit.
  • Letter to a bank enquiring about new banking facilities.
  • Letter to the bank for a long-term loan.
  • Thus, the secretary has to correspond with the Banks under certain circumstances.

Question 2.
The secretary should observe certain precautions while corresponding with the Banks.
Answer:
The following precautions must be taken by the secretary while corresponding with the banks:

  • Secretary should give a prompt reply.
  • Secretary should take care that the letter should not be lengthy.
  • Unnecessary details should be avoided.
  • Not to use any harsh or rude words while corresponding with the banker.
  • Provide true factual updates and clear information about his organization to the bankers.
  • Thus, the secretary should observe certain precautions while corresponding with the Banks.

Question 3.
The primary functions of Commercial Banks include-Accepting deposits and Lending funds.
Answer:
The main object of a commercial bank is to accept deposits and lending money to customers or account holders:

  • To encourage the people who have surplus funds.
  • To encourage the saving habit among the people.
  • To give support to businessmen for opening a current account.
  • To encourage people to make regular savings.
  • To lend loans and advances through various modes i.e. short-term loan, medium-term loan, long term loan, overdraft facility, cash credit facility, and discounting of the bill of exchange, etc.
  • Thus, the primary functions of Commercial Banks include-Accepting deposits and Lending funds.

Maharashtra Board Class 11 Secretarial Practice Solutions Chapter 11 Correspondence with Banks

Question 4.
The Bank accepts two types of deposits from the public i.e. Demand and Time Deposits.
Answer:

  • The basic aim of the bank is to pool the excess money to the bank and develop the habit of saving amount people.
  • Bank accepts deposits in two forms i.e. Demand Deposits and Time deposits.
  • Demand Deposits include – Current Deposits and Savings Deposits.
  • Time Deposits includes – Fixed Deposits and Recurring Deposits
  • Thus, the Bank accepts two types of deposits from the public i.e. Demand and Time Deposits.

Question 5.
There is a difference between Loans and Advances given by the Bank.
Answer:

  • Bank lends money in two ways – i.e. Loans and Advance.
  • The loan is granted for a specific period of time against personnel security, gold or silver, and other movable or immovable properties.
  • Advances is a credit facility provided by the bank to its customers against collateral securities like – shares, Government shares, F.D.R., L.I.C. Policy, Stock of raw materials, or finished goods.
  • Loans are granted for a longer period while Advances are granted for a shorter period.
  • Loans may be short-term, medium-term, or long-term while advances are in form of overdraft, cash credit, and discounting of bills.
  • Thus, there is a difference between Loans and Advances given by the Bank.

Question 6.
Overdraft facility is given only to current depositors.
Answer:
Overdraft is a credit facility allowed to current account holders:

  • Under an overdraft facility, the bank allows, customers, to withdraw an amount, up to a particular limit.
  • The collateral securities are usually accepted for an overdraft facility.
  • The rate of interest charged by commercial banks for overdraft is low.
  • Overdraft facility is given only to existing current depositors because they have good relations with the Bank.
  • Thus, an overdraft facility is given only to current depositors.

6. Attempt the following.

Question 1.
Write a letter to the bank for opening a Current Account.
Answer:

PRAGAT KRUSHI SEVA COMPANY LTD.
Registered office: Milind Sally Manjul,
Nashik Pune Highway, Sangamner
CIN: H353558 MH 2019 PLO 227244

Phone: 02425 – 223019
Fax: 02425 – 227230

Website: www.pragatksltd.com
Email: [email protected]

Date: 10th March 2019.

Ref No. BlbRbl212019
The Bank Manager, IDBI Bank,
New Nagar Road,
Jantar Raja Maidan,
Sangamner.

Sub: Opening of Current Account.

Dear Sir,

The Board of Directors of a company have passed a resolution on 3rd March 2019 to open a Current Account in your bank in the name of the company i.e. “PRAGAT KRUSHI SEVA COMPANY LTD.” and to appoint you as the company’s banker.

Please find enclosed herewith the following documents for the purpose of opening the Current Account of our company.

  1. Account opening form duly filled, signed and dated.
  2. Certified copy of Memorandum of Association.
  3. Certified copy of Articles of Associations.
  4. Certified copy of Incorporation Certificate.
  5. Certified copy of Board resolution regarding opening a Current Account.
  6. Specimen signature of two directors Mr. Maithily Kulkarni and Mr. Ajit Godse and the company secretary
  7. Certified copy of the list of present Directors of the company.
  8. Duly filled up Pay-in-slip along with ₹ 5,000 (Rupees Five thousand only) in cash as initial deposit.
  9. Certified copies of PAN and TAN.

Thanking you,

Yours Faithfully,
for PRAGAT KRUSHI SEVA CO. LTD.
(Sign)
Company Secretary.

Encl: As above

Question 2.
Write a letter to the bank to stop the payment of the cheque.
Answer:

AVANI GLASS LIMITED COMPANY
Registered Office: Janata Raja Maidan,
Vidya Nagar, Sangamner.
CIN: B45453 MH 1992 PCL 123272

Phone: 02425 – 227244
Website: www.avaniglass.com

Fax: 02425 – 222340
Email: [email protected]

Date: 15th March 2019

Ref. No. B/PC/1/19-20
The Bank Manager,
New Nagar Road,
Sangamner.

Sub: Stop Payment of Cheque No 303592
Ref: Our Account No 30357090414

 

Dear Sir,

It is to bring to your notice, to stop payment of the Cheque no. 303592 dated 10th March 2019 of ₹ 75,000 (Rupee Seventy Five Thousand) issued by the company from Current Account no. 30357090414 in favour of Mr. Krushna Chaudhari, Nashik.

The said cheque is reported to be lost by the party. So we kindly request you to stop the payment of the said cheque.

We highly regret the inconvenience caused to you and wishing your kind co-operation in the above matter.

Thanking you,

Yours Faithfully,
for AVANI GLASS LIMITED COMPANY
(Sign)
Company Secretary.

Question 3.
Letter requesting a bank to issue a Letter of Credit.
Answer:

B.K. INDUSTRIES LTD.
Registered Office: 240, Apeksh.
F.C. Road, Pune 4
CIN: B40418 MH 2010PIL 373078

Phone: 020 – 3070901
Fax: 020 – 3145402

Website: www.BKundu.com
Email: [email protected]

Date: 25th May 2019

Ref. No. BP/23/19-20
The Bank Manager,
Bank of Maharastra,
F.C. Road,
Pune – 4.

Sub: Issue of Letter of Credit.
Ref: Our Current Account No 020304147911

Dear Sir,

We are pleased to inform you that, we want to import printing machine from America.

As per the quotation received from Mark Industries, America we have to place an order along with a letter of credit.

We, therefore, request you to issue a letter of credit in favor of the said company USD 4,50,0000. This letter may be issued on the basis of the credit balance in our current account and as per the prevailing exchange rate.

Kindly issue the letter of credit and oblige. This will enable us to place an order at an early date.

Thanking you,

Yours Faithfully
for B.K. INDUSTRIES LTD.
(Sign)
Company Secretary.

Maharashtra Board Class 11 Secretarial Practice Solutions Chapter 11 Correspondence with Banks

Question 4.
Write a letter requesting the bank to grant an overdraft facility.
Answer:

JAI MATA GLASS AGENCIES LTD.
Registered Office: 285, M.G. Road,
Dwarka. Nashik.

Phone: 0253 – 27304580
Fax: 0253 – 283048800

Website: jaymata.com
Email: [email protected]

Date: 10th January, 2019

Ref. No. BK/7/20-19
The Manager,
RDBI Bank
Dwarka, Nashik.

Sub: Request for overdraft facility
Ref: Account No. 00303540451

Dear Sir,

The Board of Directors in their meeting held on 2nd January 2019 has decided to request you to grant our company an overdraft facility up to ₹ 10 lakhs for a period of 5 months from March 2019 to July 2019.

We are the manufacturer of Tuffen glass and we have a large export order for which we need to have working capital to fulfill our daily needs.

We request you to accept our security of Fixed Deposit worth ₹ 10 lakhs with your bank.
We would also like to bring to your notice that we are being your customer for the last 10 years.
Expecting your early reply in favor of our overdraft facility.

Thanking you,

Yours Faithfully,
for JAI MATA GLASS AGENCIES LTD.
(Sign)
Company Secretary

Activity (Textbook Page No. 168)

Visit a Bank and collect the form of opening a bank account and find out. The detail to be filled in and Documents needed to open an account.
Answer:
Yesterday, I visited the IDBI Bank of India, Sangamer Branch.
I collected the account opening form from Mr. Abhay Kulkarni Bank Officer.
The following are the details to be filled in in the Account opening form.

  1. Branch Name
  2. Date of opening account
  3. Branch Address
  4. Scheme Codes
  5. Account Number
  6. Type of Account
  7. Full name in Capital Letter
  8. Date of Birth
  9. Occupation
  10. PAN
  11. Name of Guardian
  12. Relationship with minor
  13. Operating instruction
  14. Facilities required
  15. Statement of Account through
  16. Other information
  17. Declaration, if any
  18. Specimen signature
  19. Signature

Document required for opening a Bank Account.

  1. Certified copy of Articles of Association and Memorandum of Association.
  2. Certified copy of Board Resolution regarding the opening of a Current Account.
  3. Specimen signature of Directors and Secretary.
  4. List of Directors
  5. Certificate of Incorporation.

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