Drishtikon: A Management Journal

Open Access Open Access  Restricted Access Subscription Access
Open Access Open Access Open Access  Restricted Access Restricted Access Subscription Access

Financial Service Quality and Its Impact on Customer Satisfaction:Evidence from Indian Banking Sector


Affiliations
1 Department of Management, Sikkim University (A Central University, Gangtok, Sikkim), India
     

   Subscribe/Renew Journal


Customer satisfaction and loyalty in long run, prominently depend upon the way the organisations deliver the products and services to the customers. The emergence of digital ways of providing services have forced the bankers to devise different set of policies to attract the customers. Thus, this paper explores the dimensions of financial services quality in Indian banking sector and their impact on customer satisfaction. The underlying model of SERVQUAL with five dimensions, was adopted in this paper with one additional construct i.e. customer satisfaction to evaluate the impact of financial service quality on customer satisfaction among public and private sector banks in India. The findings show that in addition to the four dimensions of SERVQUAL model i.e. Empathy, responsiveness, assurance and tangibles; there is one more significant dimension i.e. Technology, which bothers more to Indian banking customers in assessing the financial service quality. Further, results of linear regression analysis revealed that Empathy and issues related to security & use of technology in the banking transactions are significantly important to the customers in determining their satisfaction with the quality of financial services. The policy makers may use these findings and concentrate on making their financial services more reliable & empathetic and shall ensure the right use of technology in making the transactions safe & secure in order to improve and strengthen the database of satisfied customers in long run.


Keywords

SERVQUAL, Empathy, Responsiveness, Tangibles, Assurance, Technology, Customer Satisfaction.
Subscription Login to verify subscription
User
Notifications
Font Size


  • Aga, M., & Safakli, O. V. (2007). An empirical investigation of service quality and customer satisfaction in professional accounting firms: Evidence from North Cyprus. Problems and Perspectives in Management, 5(3), 84-98.

  • Anderson, E., Fornell, C., & Lehmann, D. (1994). Customer satisfaction, market share and profitability. Journal of Marketing, 58(3), 53-66.

  • Andreassen, T., & Olsen, L. (2008). The impact of customers’ perception of varying degrees of customer service on commitment and perceived relative attractiveness. Managing Service Quality, 18(4), 309-328.

  • Babakus, E., & Mangold, W. (1992). Adapting the SERVQUAL scale to hospital services: An empirical investigation. Health Services Research, 26(6), 767-786.

  • Bateson, J. E., & Hoffman, K. (1997). Essentials of services marketing. Orlando: The Dryden Press.

  • Bennett, D., & Higgins, M. (1993). Quality means more than smiles. ABA Banking Journal, 46.

  • Bick, G., Brown, A., & Abratt, R. (2004). Customer perceptions of the value delivered by retail banks in South Africa. The International Journal of Bank Marketing, 22(4/5), 200-318.

  • Bitner. (1990). Evaluation service encounters: The effects of physical surroundings and complaint reports. Journal of Marketing, 54(4), 69-82.

  • Bolton, R., & Drew, J. (1991). A multistage model of customers’ assessments of service quality and value. Journal of Consumer Research, 17, 375-384.

  • Bowen, J., & Hedges, R. (1993). Increasing service quality in retail banking. Journal of Retail Banking, 15, 21-28.

  • Buzzell, R., & Gale, B. (1987). The PIMS principles. New York: Free Press.

  • Carman, J. M. (1990). Consumer perceptions of service quality: An assessment of the SERVQUAL dimensions. Journal of Retailing, 66(Spring), 33-55.

  • Cowling, A., & Newman, K. (1995). Banking on people. Personnel Review, 24(7), 25-41.

  • Cronin, J., & Taylor, S. (1992). Measuring service quality: Reexamination and extension. Journal of Marketing, 56(3), 55-68.

  • Crosby, P. (1979). Quality is free. New York: McGraw-Hill.

  • Davies, F., Moutinho, L., & Curry, B. (1995). Construction and testing of a knowledge-based system in retail bank marketing. International Journal of Bank Marketing, 13(2), 4-14.

  • Dawes, J., & Swailes, S. (1999). Retention sans frontiers: Issues for financial service retailers. International Journal of Bank Marketing, 17(1), 36-43.

  • George, D., & Mallery, P. (2003). SPSS for windows step by step: A simple guide and reference. Boston: Allyn & Bacon.

  • Gronroos, C. (1984). A service quality model and its marketing implications. European Journal of Marketing, 18(4), 36-44.

  • Headley, D., & Miller, S. (1993). Measuring service quality and its relationship to future consumer behavior. Journal of Health Care Marketing, 13(4), 32-41.

  • Karatepe, O., Yavas, U., & Babakus, E. (2005). Measuring service quality of banks: Scale development and validation. Journal of Retailing and Consumer Services, 12(5), 373-383.

  • Kristensen, K., Dahlgaard, J., & Kanji, G. (1992). On measurement of customer satisfaction. Total Quality Management, 3(2), 123-128.

  • Lasser, W., Manolis, C., & Winsor, R. (2000). Service quality perspectives and satisfaction in private banking. Journal of Services Marketing, 14(3), 244-271.

  • Mc Coll-Kennedy, J., & Schneider, U. (2000). Measuring customer satisfaction: Why, what and how. Total Quality Management, 11(7), 1-14.

  • Munusamy, J., Chelliah, S., & Mun, H. W. (2010). Service quality delivery and its impact on customer satisfaction in the banking sector in Malaysia. International Journal of Innovation, Management and Technology, 1(4), 398-404.

  • Nunnaly, J. (1978). Psychometric theroy. New York: McGrow-Hill.

  • Oliver, R. (1980). A cognitive model of the antecedent and consequences of satisfaction decisions. Journal of Marketing, 17(10), 460-469.

  • Parasuraman, A. Z. (1988). SERVQUAL – a multiple-item scale for measuring consumer perceptions of service quality. Journal of Retailing, 64(1), 12-40.

  • Parasuraman, A., Zeithaml, V., & Berry, L. (1985). A conceptual model of service quality and implications for future research. Journal of Marketing, 49(4), 41-50.

  • Parasuraman, A., Zeithaml, V., & Berry, L. (1991). Refinement and reassessment of the SERVQUAL scale. Journal of Retailing, 67(4), 420-450.

  • Preko, A., Agbanu, S. K., & Feglo, M. (2014). Service delivery, customer satisfaction and customer delight in the real estate business. Evidence from Elite Kingdom investment and consulting company Ghana. European Journal of Business and Management, 6(3), 71-83.

  • Reichheld, F., & Sasser, W. J. (1990). Zero defections: Quality comes to service. Harvard Business Review, September-October, 105-111.

  • Rust, R., & Zahorik, A. (1993). Customer satisfaction, customer retention and market share. Journal of Retailing, 69(2), 193-215.

  • Sanjuq, G. (2014). The impact of service quality delivery on customer satisfaction in the banking sector in Riyadh, Saudi Arabia. International Journal of Business Administration, 5(4), 77-84.

  • Seth, A., Momaya, K., & Gupta, H. (2008). Managing the customer perceived service quality for cellular mobile telephony. Vikalpa, 33(1), 19-34.

  • Stafford, M. (1996). Demographic discriminators of service quality in the banking industry. The Journal of Services Marketing, 10(4), 6-22.

  • Thakur, S. (2011). Service quality, customer satisfaction and customer loyalty: A study with special reference to indian banking industries. Journal of Banking Financial Services and Insurance Research, 1(5), 83-93.

  • Yavas, U., & Yasin, M. (2001). Enhancing organizational performance in banks: A systematic approach. Journal of Services Marketing, 6, 444-453.

  • Zeithaml, V., Berry, L., & Parasuraman, A. (1996). The behavioral consequences of service quality. Journal of Marketing, 60(2), 31-46.


Abstract Views: 294

PDF Views: 1




  • Financial Service Quality and Its Impact on Customer Satisfaction:Evidence from Indian Banking Sector

Abstract Views: 294  |  PDF Views: 1

Authors

Krishna Murari
Department of Management, Sikkim University (A Central University, Gangtok, Sikkim), India

Abstract


Customer satisfaction and loyalty in long run, prominently depend upon the way the organisations deliver the products and services to the customers. The emergence of digital ways of providing services have forced the bankers to devise different set of policies to attract the customers. Thus, this paper explores the dimensions of financial services quality in Indian banking sector and their impact on customer satisfaction. The underlying model of SERVQUAL with five dimensions, was adopted in this paper with one additional construct i.e. customer satisfaction to evaluate the impact of financial service quality on customer satisfaction among public and private sector banks in India. The findings show that in addition to the four dimensions of SERVQUAL model i.e. Empathy, responsiveness, assurance and tangibles; there is one more significant dimension i.e. Technology, which bothers more to Indian banking customers in assessing the financial service quality. Further, results of linear regression analysis revealed that Empathy and issues related to security & use of technology in the banking transactions are significantly important to the customers in determining their satisfaction with the quality of financial services. The policy makers may use these findings and concentrate on making their financial services more reliable & empathetic and shall ensure the right use of technology in making the transactions safe & secure in order to improve and strengthen the database of satisfied customers in long run.


Keywords


SERVQUAL, Empathy, Responsiveness, Tangibles, Assurance, Technology, Customer Satisfaction.

References