Service Quality’s Effect on Customer Satisfaction (A Comparison Assessment of the Public and Private Banking Sectors)

Abstract

The objective of this research has to compare the effect of service quality on customer loyalty in Kombolcha city between public and private banks. As a result, the study’s findings are important in that they offer solutions for bank customer satisfaction issues and give them an understanding of where they are now in terms of service quality and what they can do in the future to please customers and compete effectively with the sector’s current fast growth. The analytical analysis methodology was used to achieve the study’s goals by combining quantitative and qualitative data descriptions. A total of 385 bank customers were interviewed and a questionnaire was used to gather data. Convenient screening methods were used to collect the sample. Statistical methods such as mean, standard deviation, correlation, independent sample t-test, and multiple regression analysis were used to interpret the collected results. The findings of this study show that all five service quality dimensions (tangibility, assurance, openness, empathy, and reliability) have a strong and important association with customer satisfaction and that customers of the public bank in Kombolcha town are dissatisfied with all five dimensions of service quality. Customers of private banks, on the other hand, were pleased with the three service level dimensions (Tangibility, responsiveness and assurance.) Customers in private banks, on the other hand, we’re disappointed with the efficiency and empathy aspects of service quality. Similarly, the five service quality dimensions (tangibility, empathy, assurance, and reliability) were found to explain 68.9% of the differences in customer satisfaction in public and private banks in Kombolcha town. The researcher contains suggestions to the bank’s management and makes suggestions for other studies conducted on the study’s results.