CUSTOMER SATISFACTION AND SERVICE QUALITY INFLUENCE ON BANK SWITCHING BEHAVIOUR IN A SOUTH AFRICAN CONTEXT
CUSTOMER SATISFACTION AND SERVICE QUALITY INFLUENCE ON BANK SWITCHING BEHAVIOUR IN A SOUTH AFRICAN CONTEXT

Summary/Abstract: BANKING CLIENTS AND DEPOSITORS BECAME MORE SERVICE- AND PRICECONSCIOUS IN THEIR PURCHASING BEHAVIOUR OF FINANCIAL SERVICES, THUS THEIR BANKING BEHAVIOUR BECAME INCREASINGLY PRONE TO CHANGE. CONSEQUENTLY, BANK CUSTOMERS TEND TO SWITCH BANKS DUE TO UNDERLYING FACTORS INFLUENCING THEIR DECISION-MAKING BEHAVIOUR. CONVERSELY, BANKS STRIVE TO RETAIN AND ATTRACT MORE CLIENTS AS THIS MAY INCREASE FUTURE INCOME AND REDUCE THE RISK OF LIQUIDATION. THE BANKING INDUSTRY OF SOUTH AFRICA IS CHARACTERISED BY CONCENTRATION THROUGH THE DOMINANCE OF A FEW LARGE BANKS. COMPETITIVE BANKS SUCH AS THOSE IN SOUTH AFRICA HAVE INCORPORATED SERVICE QUALITY IN THEIR STRATEGIES TO GAIN A COMPETITIVE ADVANTAGE OVER THEIR COMPETITORS. HOWEVER, IN THE EVENT OF LOW SERVICE QUALITY, BANKS MAY FALL SHORT OF CUSTOMER EXPECTATIONS WHICH HAVE AN IMPACT ON THE OVERALL SATISFACTION OF CUSTOMERS. CUSTOMER SATISFACTION HAS BEEN RECOGNISED TO HAVE A CRUCIAL ROLE IN A SUCCESSFUL COMPETITIVE BANKING ENVIRONMENT. THUS, THIS STUDY AIMED TO INVESTIGATE THE INFLUENCE OF CUSTOMER SATISFACTION, SERVICE QUALITY AND DEMOGRAPHICS ON BANK SWITCHING BEHAVIOUR IN SOUTH AFRICA. THE STUDY FOLLOWED A CROSS-SECTIONAL DESCRIPTIVE RESEARCH DESIGN. SELF-ADMINISTERED QUESTIONNAIRE FROM A SAMPLE OF 324 BANK DEPOSITORS WAS COLLECTED AND ANALYSED. THE ANALYSIS INCLUDED DESCRIPTIVE STATISTICS, CORRELATION ANALYSIS AND BINARY REGRESSION ANALYSIS. THE FINDINGS OF THIS STUDY SHOW THAT CUSTOMER SATISFACTION AND BANK RELIABILITY SIGNIFICANTLY INFLUENCES DEPOSITORS’ BEHAVIOUR TO SWITCH BETWEEN BANKS. IT WAS ALSO FOUND THAT A RELATIONSHIP EXISTS BETWEEN EMPATHY AND AGE IN BANK SWITCHING BEHAVIOUR. THIS FINDING IMPLIES THAT BANKS SHOULD WORK ON SERVICE QUALITY DIMENSIONS, ESPECIALLY THE RELIABILITY OF SERVICES TO ENSURE CUSTOMERS ARE SATISFIED AND RETAINED.

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