SERVICE QUALITY AND CUSTOMER SATISFACTION OF SELECTED MONEY DEPOSIT BANKS IN PORT HARCOURT
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SERVICE QUALITY AND CUSTOMER SATISFACTION OF SELECTED MONEY DEPOSIT BANKS IN PORT HARCOURT
Background of The Study
Nigerian banks are currently facing huge hurdles as a result of increased competition, making survival increasingly difficult. To survive and thrive as a provider of financial services, it is critical that the current environment adopt a new management structure that will enhance customer pleasure while also improving business performance.
Customers have clearly become so knowledgeable and aware of their importance that disregarding them in search of a competitive advantage can be deadly for banks today. As a result, banks must ready themselves for the obstacles in order to deliver good client care.
African Banking Corporation launched its first bank in Lagos in 1892 to fund the shipping company of Elder Dumpster and Company, who operated steamship lines between Liverpool and the West African coast. In 1893, the Bank of British West Africa (now First Bank of Nigeria Plc) took over the business of the African Banking Corporation.
Barclays Bank (now Union Bank of Nigeria Plc) was founded in 1917. Many more banks were established in the following year, including the British and French Bank (now United Bank for Africa Plc) founded in 1949, the Industrial and Commercial Bank founded in 1929,
the National Bank of Nigeria Plc founded in 1933, the Agbonmagbe Ban (now Wema Bank) founded in 1945, the Nigeria Penny Bank founded in 1940, the Nigeria Farmer and Co-operative Bank Plc founded in 1947, and so on. Okoh, S. E., and A. O. Unugbro, 2003.
Since independence, the banking industry has expanded dramatically and now services a larger share of the general public. The liberalisation of bank licences in 1980 promoted a more competitive atmosphere and efficiency in the financial industry. A bank is a customer-focused service industry.
A bank’s viability in the market is dependent on its customers. The focus is on the consumer, and customer service is one of the differentiating characteristics (Guo et al., 2008). A bank can set itself apart from competitors by delivering excellent customer service (Naeem & Saif, 2009).
Service quality is undeniably an important input for customer satisfaction, which influences customer behaviour in terms of loyalty (whether expressed in customers’ repurchase intentions, positive word of mouth, or an increase in the number of banking operations performed), and thus improves a bank’s image and performance. Customer service effectiveness is linked to progressive functioning.
Customer satisfaction is regarded as the essence of success in the competitive banking business. Service quality should be seen as a critical strategic problem for organisations operating in the service industry (Spathis et al., 2004).
Service providers who maintain a high degree of service quality maintain a high level of client satisfaction; they also get a durable competitive edge. According to research,
companies with an excellent customer service record reported a 72% increase in profit per employee when compared to similar organisations with poor customer service; it is also five times more expensive to attract new customers than it is to retain existing customers (Duncan, 2004).
Previously, service quality was defined as the extent to which a service meets the demands or expectations of the consumer (Lewis & Mitchell, 2000). The bank should be aware of the customer’s expectations and perceptions.
Measuring the customer’s expectations is essential for providing satisfactory service. However, with a greater grasp of the customer’s views, the bank can identify the activities necessary to suit the customer’s needs. In this manner, they can quickly satisfy the consumer, which has a direct impact on the bank’s overall performance.
Customer satisfaction is a vital instrument for running a business and achieving the mission statement. Indeed, client happiness is extremely important for an institution’s future, and it is viewed as a foundation for securing market position and fulfilling other institutional goals. As a result, providing excellent service is one way to keep clients delighted and loyal (Perng, 2007).
Because of the enormous growth of banks, customers in the banking sector have a strong bargaining power. Because of the availability of banks, banks must provide services with caution. Over the last three decades, service quality has been a critical topic of debate and inquiry.
Customer opinion of service quality is strongly linked to pre-service expectations, according to service quality research. According to studies by Parasuraman et al. (2005) and Zeithmal et al. (2000), providing quality services to consumers is a critical strategy for the success and survival of any commercial institution.
As a result, according to Chang (2008), outstanding service quality is critical to corporate success and survival. As a result, in today’s competitive market, providing quality service to clients is a must for success and survival (Kheng et al., 2010).
Banks deal with the money of their customers. As a result, the more satisfied clients in a bank’s row, the more secure company and profitability. If a bank is unable to provide adequate customer service, it will lose clients.
Profitability would also suffer as a result of poor customer service. According to Kang (2004), many service delivery faults and problems can arise, which is detrimental to the organization’s reputation.
According to Ha and Jang (2009), service failure happens when consumer perceptions do not match customer expectations. The issue with service failure is that it can sever the customer’s relationship with the organisation.
Thus, the relevance of customer satisfaction in today’s changing corporate climate is evident, as it has a significant influence on consumer repurchase intentions, whereas discontent has been identified as a main factor for customer switching intentions.
Customers who are pleased with their purchases are more likely to tell five or six other individuals about their purchases. Similarly, unsatisfied customers are more likely to tell 10 other people about their bad experiences with a certain company.
To achieve customer satisfaction, organisations must be able to establish and sustain long-term relationships with customers through meeting a variety of their requirements and wants (Pizam & Ellis, 2009).
Otherwise, the combined effect of poor word-of-mouth, switching, and reduced consumption will have an impact on the bank’s productivity and profitability.
1.2 Statement Of The Problem
The importance of the client in any company organisation cannot be overstated, given that the customer is the lifeblood of any business’s survival. In recent times, Nigerian banks have fallen short of their clients’ expectations.
Customers have reported issues ranging from delays, stock outs, unavailability of staff at service locations, unprofessional conduct or rudeness by bank workers, poor quality of records or incorrect information, and broken promises, among other things.
Customers’ satisfaction and service quality are inextricably intertwined, creating value for the customer. Customers will have a favourable opinion of a company if they receive services that meet or surpass their expectations.
If clients believe they received less value than promised, their attitude towards a certain organisation would be negative, and they may pass this attitude on to new customers (Chau & Kao, 2009).
Customers will become loyal if they are satisfied; however, if they are disappointed, their loyalty is not guaranteed. As a result, management should place a premium on customer happiness, which begins with providing high-quality service (Mohsan et al., 2011).
According to Ogunnaike and Ogbari (2008), customer service in our money deposit bank is often misunderstood as customer delay and frustration. According to the writers, practically every Nigerian bank faces a similar difficulty in satisfying consumers’ service expectations and ensuring customer happiness.
One big difficulty that customers of certain banks have had to deal with is the issue of money transfer. In most circumstances, the consumer does not immediately get reimbursement for funds transferred to his account.
1.3 Objectives Of The Study
The study’s major goal is to investigate the Service Quality and Customer Satisfaction of Selected Money Deposit Banks in Port Harcourt. The following are the study’s specific objectives:
1. To investigate the relationship between service quality, dependability, and customer satisfaction at a money deposit bank in Port Harcourt.
2. To investigate the relationship between service quality assurance and customer satisfaction at a Port Harcourt money deposit bank.
1.4 Research Questions
The following research questions were developed to lead the study and achieve the aforementioned objectives:
How much does dependability improve customer satisfaction?
How much does assurance improve customer satisfaction?
1.6 Research Hypotheses
H01: There is no statistically significant relationship between dependability and customer loyalty.
Ho2: There is no statistically significant relationship between Assurance and Brand Advocacy.
1.6 Significance of the Research
This study will benefit and be of interest not only to banks in Port Harcourt, but to other service sectors in Nigeria as a whole.
The study will also serve as a source of primary and secondary data for other scholars who wish to do research on similar topics. It will once again serve as the mainstay for acquiring, retaining, and retaining clients. The following are the study’s implications:
i. To provide efficient customer service to the banking public.
ii. To improve economic efficiency and resource allocation in the Nigerian banking system.
iii. Increasing the effects of positive client loyalty in the banking industry.
1.7 Scope of the Study
This study will focus on the functioning of a few banks in Port Harcourt, Nigeria. This would allow the researchers to generalise and confirm how successful Service Quality and Customer Satisfaction have been able to remain in the Port Harcourt Money Deposit Bank.
1.8 Limitations of The Study
The following are the study’s limitations:
Due to time constraints, it was not possible to cover all of the private commercial banking offices.
The topic’s data and information were not freely accessible.
The data is kept discreetly by the bank. For obvious reasons, the bank’s policy of not providing some sensitive data and information provided an impediment to the practical orientation that could be very valuable.
1.9 Definition of Terms
Service Excellence
The gap between customers’ expectations and their perceptions of the service provided (Ouyung, 2010).
Customer Contentment
Personal feelings, either positive or negative, as a result of evaluating services given in respect to client expectations (Taiwo et al., 2011).
Quality: The combination of elements of a service that can provide satisfaction (Akbar & Parvez, 2009).
Reliability: The ability to provide the given service consistently and precisely (Armstrong, 2012).
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